Line Of Credit Draw

You know you need to do something but when do you choose credit couseling and when do you chose bankruptcy?

When your obligations (your "debts") are more than your income. Most credit counseling agencies will not even help you beyond preparing a budget if your income is in the red.

On the other hand, just having negative income is not a good enough reason to declare bankruptcy. There are plenty of things you can do to reduce your debt.

Have you considered a debt consolidation loan? (Be careful here to really make sure you are getting a good deal.)

Have you asked your creditors to reduce your interest rate? (Believe it or not, many will just by asking!)

Have you looked at reducing expenses? (Eliminate cable, high speed internet and food from your life. Okay, I'm joking about food, but you must sacrifice in meager times.)

Have you looked at getting a second job? (Often, just a few hours a week extra is all that is needed to make up the difference.)

Have you looked at reducing 401(k) payments temporarily? (Doesn't make sense to keep paying into an account you will not see for possibly decades if it is driving you into bankruptcy today.)

Anyway, a credit couselor can give you tons of advice on how to reduce or eliminate expenses - even if they cannot help you because you have a negative income. And, under the new bankruptcy laws, you have to see a credit counselor BEFORE you file for bankruptcy and get a certificate of attendance to the court.

Evidently, the credit counseling lobby is more powerful than I had originally anticipated.

Hope this helps!

P.S. Credit counseling is not seen as a bad thing. Most creditors like to see credit counseling - it shows you are trying to take care of your debt and not just write it off. If you MUST file bankruptcy, consider a Chapter 13 (where you make structured payments to the court and pay your debt down) as opposed to a Chapter 7 (where you write off your debt). A Chapter 7 stays on your credit for 10 years, and nothing makes a creditor more leary than seeing someone borrow money and saying "Scr#w you!". If you file a Chapter 13 and make the payments, it can actually be a very good thing to your credit. Again, it shows you are taking responsibility for you actions, and soon creditors will be extending credit offers to you again. Just be sure to use the offers wisely!

2006-02-20 19:02:22 by tammie

professional Andy Keuter as he discusses the differences between a home equity line of credit (HELOC) and a home equity loan (HELOAN). You'll ...

I can't afford to pay the total amount due every month, so I pay a little over the minimum. But this is making it impossible for me to pay anything off! What can I do? It's stressing me out!

I agree with every other poster.

It's called personal responsibility.

Grow up and start taking responsibility for your actions. You owe the money, they are not going to simply stop billing you, so find a second job or cut back on expenses and pay your bills.

2007-08-14 06:03:15 by kunstquid

Price: $5.95 $5.95

To pad my cash cushion in case my business needs it, before the credit window closes, should I draw from my available line of credit at 5% APR and invest it in CDs or High Yield Bonds @ 4% and pay the difference as a cash insurance strategy?

So long as they are short term investments and you don't tie the cash up should you need it. Sure, how can you beat a 1% loan? Just don't forget to factor in that you will be paying tax on the 4% interest. So, the loan will actually cost you more than 1%. You might see if there are any short term municipal bonds even if the interest isn't as high, you wouldn't have a tax liability.

Your question is a good one, you should access the money while you still can. put the money to work for you, and make sure you do it in the most efficient way tax-wise. Perhaps your business can write off the interest paid on the loan? Probably not, since it is on your house, but maybe there is a way of lending the funds to the business from you personally. I don't know the answer to that-- I think you should talk to an accountant. Good luck!

Incidentally, my friend had an equity line on his house ( untapped= for emergencies) and he got a letter from his lender, they are out of the equity line business! They cancelled it flat out!

2008-11-16 16:34:56 by Simon

Price: $16.99

I have one credit card with a credit line of 400(cash line of 80$). I know the max I can draw from an ATM is the 80$. But is there any way I can go into the bank and get the credit line deposited into my bank account?

The only way would be to do a cash withdrawal, then put the cash in your bank account.

Of course, the APR on a cash withdrawal is usually INSANELY high, so make sure you're willing to throw that money away in the form of finance charges.

Some cards will occasionally offer checks that you can write against your credit card balance, in which case you could probably write one to "Cash" and cash it, but those aren't that common.

2008-03-18 21:29:42 by nana_puddin_13

Was wondering if this line makes sense:

"A bank draft drawn against my Line of Credit"

Makes perfect sense to me. That is actually the normal method of accessing a line of credit. Those pieces of paper that look like checks are technically bank drafts.

2007-08-21 15:03:07 by BS9999