I'm in college, 21 and I was extremely stupid and now I have 6, 531 in credit card debt!?

Question

I don't want to tell my parents and I am trying to figure out the best way to pay off this debt. Should I close the account? Will that hurt my credit score even more? What does my credit score look like with the 6, 531 I owe? What is the best why I can get myself out of this mess? And still have a decent credit score? What should I say to the creditors? Should I close the account and go to the collection agency? Please help! And yeah I know I'm young and dumb and I f**ked up big time!!

I haven't been paying anything on the card since January. And I can order afford 100 per month on the card. Should I tell the creditors thats all I can afford? And see if they can work with me? The spending limit was 2,000 and with 19. interest.

Answer 1

I did this when I was in my 20's and it been a valuable life lesson. Address this correctly and you'll come out OK. As others have said, cut up the card, make your minimum payments and trim down your lifestyle and do not buy anything that is not a necessity. That means the late night BK or Taco Bell runs (7 bucks each for a value meal) or even a 99 cent iTune. It all counts! Also investigate a second job. Six g's is a lot for a 21 year old in college but you will soon find extra cash to apply to the card if you do the above. Make at least the minimum or your credit will suffer. Add the extra cash mentioned above anytime you have it.

The only thing that may hurt you at this point is if you're close to your credit limit but that's not permanent. FICO doesn't like it when you are at 90% of your credit capacity (includes all cards) But by making the minimum every month and establishing a record of consistent ontime payments you will BUILD your credit. Missing one payment will KILL your credit. And the worst thing to do is not answer the phone when they call (if they are calling)

Again, apply all extra cash to the card. Call them up and kindly ask for a reduction on your interest rate.

You should also know that you are not the only one in this situation. There are people making 50K who are 20K in debt. There are people who make 100K and are 40K in debt. That said, you'll be able to pay off 6.5 grand if you have discipline. The key is breaking the habit of impulse buying and cutting down your current spending.

Good luck,

Mike

Answer 2

Keep making payments on time. But in order to get the debt down faster, you probably should pay more than the minimum. If you pay only the minimum you are only paying interest. Anything over the minimum is considered principle. That is what you want to pay off. Don't close the account, just cut up the card. Talk to your parents. They may be more understanding than you think. If not you'll have to figure it out. Try seeking out businesses that work with people and debt. There are companies that will help lower your bills and help you pay it off faster. That would be a great place to start. Seriously, don't try and avoid it. Debt will always follow you. Good luck!

Answer 3

Im in the same boat as you are. Im 21 and have 14,000 in credit card debit. First you need make a payment to the cards especially since you have made a payment since jan. I would first call you credit cards (this is what i did) and explain you situation and tell them you can pay so much each month. One of my credit cards offered me 0% for six months so i could pay the card off and get my credit score up. Also most of your credit cards will work with you and take late charges off your account if you make a payment agreement with them. The next step i would do i talk to your parents and see if you could borrow money from them and pay them back interest free. good luck and i know how stressed you must be.

Answer 4

Fitrst call the credit card company, cancel the card and see if you can get a reduction in interest. They might not give you a break, but you might as well ask. You are entitled to one copy of your credit score each year. Fico is one place to ask.
If you can pay this back without missing too many payments your credit score will probably improve.
If you don't hink you can do this alone look into the Consumer Credit Counseling Service. They are a not for profit that helps people in a lot worse shape than you.

Answer 5

Calm down first of all. Go to the creditor, and tell them that you want to set up a repayment plan. What you're going to do is just stop using the card all together, and pay them back in equal monthly payments. If you don't like that idea, cut up the card and pay as much as you can each month until it's paid off. Unless you can come up with the whole amount, I really don't see too many other options, especially if you're worried about your credit. If you keep paying the card down, you're credit score will actually increase. It's when you let it go to collections that you wind up ruining what little credit you had. ;) Good luck!

Answer 6

Remain Calm! Yes, you've got yourself into a pickle, but its not the end of the world. Believe it or not, $6,531 in credit card debt is not as bad as it gets. Believe me! And as long as you're making your payments, your credit shouldn't suffer TOO much.

The first thing you need to do is understand that you DO need help. Don't hide it from your parents. They've probably been through this before, and have some good advice. Yeah, you'll probably get the big "financial responsibilty" lecture, but that's a small price to pay to get help.

The next thing to do, is to determine whether or not you can meet the monthly payments. If not, contact your credit card company. Don't just wait for stuff to happen. They can help you make temporary payment arrangements. Just remember, from their perspective, a partial payment is better than a bankruptcy.

Ideally, you're going to want to make double your minimum payments if you want to pay it off fast. If you can't double it, pay what you can. Just make sure you pay a little more than minimum. The higher your monthly payments, the quicker this will be resolved.

Now, here's the hard part. You have to find more money to pay this big bill. You'll have to either give something up, such as cable, or that cell phone, to do it. Better yet, get a job, or a better one if you already have one. Your best bet is to do both.

If you accomplish this, even with A FEW late payments, your credit will benefit from it. You certainly are establishing a payment history!

Good luck, and remember to talk to your family!

Answer 7

Oh this sounds oh so familiar! A few years ago I was going through the same thing... If the creditors refuse to take anything less than $100 bucks each a month and you can't afford that then there's not much you can do. What you can do it try to contact the credit card company and see if they will work something out with you. Some do, and some just say "oh well", and refer you back to the creditors they sent your info to. One particular creditor told me I had to pay the whole thing in full or I was going to be sued. I just ignored the jerk who kept calling me and mailed what I could when i could, and kept proof of the cashed checks (just so they wouldn't give me a hard time later on). They sent me new statements with the new balance every time, and they'd still call and tell me I needed to pay in full. I just kept paying what I could to chisel away at it... Eventually I found a new job and was able to take care of it. Another creditor after months of harassing me came to me with a pay off balance. Which was what I owed my card, minus the finance charges and fees that had accumulated. Let me tell you that was nice! If someone makes you an offer like that, try to take it. Better to owe a friend, or family member than have to pay interest and fees right? You said yourself your credit was already bad, so this won't make it much worse. It takes a few years for your credit to improve anyways. These creditors can be real big jerks. Sometimes they are so rude I swear you just want to cry. They try to treat you like you are some deadbeat scum bag because you are unable to make payments. Don't let them get to you. You're human and make mistakes just like anyone else. Like I said, I went through this, my husband did when we dated, so many of my friends did or still are... In time you'll get through it, and eventually work towards being debt free. Until then don't let this weight you down, because debt is a heavy burden. And if you let it get the best of you, it'll do nothing but drag you down. Just focus on finishing school, and make that your number one priority right now. Debt can wait, because without the education you won't be able to get a good paying job to pay off that debt! Oh, and stay away from these "debt counselors" they might tell you to call. It's a scam. Good luck with everything! =)

Answer 8

Part of growing up and becoming an adult is being able to admit when you need help. Yes you made some bad decisions with the credit card, but I suggest you talk to your parents and ask for their help. If they are not willing to help just continue making the monthly payments, on that amount the payment should not be more than $25-$30 a month, even a college student can handle that payment. Either way the card needs to be cut up.

Answer 9

You should try to speak to the credit card company and explain the situation. If you have not paid this card since January you may already have lowered your credit score. If you are paying all of your other debts on time and there is only one credit card you are indebted to, the credit card company may agree to your terms. You should definitely give it a shot. Even a small payment is better than no payment.

Answer 10

Work your butt off until school starts up again, then get a part-time job when you're back at school. In the meantime, call the credit card bank, and tell them you want to deactivate the account. So long as you continue to make payments and on time, this won't hurt your credit history. When school starts again, if you can't make enough to make the minimum payment working part-time, call the bank again and see if you can negotiate a more realistic payment term. Try to get this thing paid off before you graduate school, or you may have a hard time later if you want to move away, buy a new car, etc.