Credit card debt, and how to get out of it?!?!?

Question

I have credit cards and all of them are over my limit...How can I help to lower my debt, but not have it effect my credit any worse, than what my credit already is?!?!?

Answer 1

Just pay your creditors! I don't know why you'd want to get in debt in the first place. I always pay cash for my things. Houses, cars, butlers, etc...

Answer 2

Start by listing your credit cards on a sheet of accounting paper - you know, the kind with the columns and rows. List them by the highest interest rate first. As an example, from the top down, I would list the 28%, 24%, 20%, 16%, etc. This is important because it is the highest interest rate cards that will "grow" the fastest if you only pay the minimum payment.

Now, with the list in hand, make the minimum payments on all but the highest rate card. On that one, you pay everything you can reasonably afford. You do that month after month, paying only the minimum on the others. When that one is paid off, you attack the next high interest card.

As you do this, you will find that each time a card is paid off, you have more and more money available to pay off more and more of your debt. Stay on the plan and, I assure you, your debt load will shrink faster than you ever expected. Now, one more thing.

As you pay off a card, DO NOT close the account. As almost 1/3 of your credit score consists of credit history, if you close an account, your history shrinks and so does your credit score. Cut up the card, put it in your jewelry box, whatever, but don't close that account

Answer 3

While I agree Dave Ramsey is good, I think you want help right now.

I am in the same place as you and my family is in the process of getting a consolidation loan to get out once and for all. We are getting rid of all of our cards but 1 with a very low limit.

If you are like me and you are/were over your limits and with the new law passed by the federal government allowing credit card companies to raise their minimum payments so you will pay off your debt early (yeah right) your minimum payments may be what's killing you.

I called each creditor and was told by many that was just to bad and they wanted what I was over on my limits too. Talk about feeling like you were drowning.

While I do not suggest closing your accounts as you will no longer be able to work with that creditor if they think they don't have your business, I do suggest cutting them up. At least that way you cannot use them anymore.

If you have something paid off, say a car, house ect use that for collateral and get a consolidation loan. Pay off what you can with that.

If you don't have that available to you and you have tried your best to speak to the credit card people, try a credit place, such as a credit counseling center. They can help you get reasonable payments without bankruptcy.

I know it seems overwhelming. And I know it is easy to get into. Very easy. But there is a way out without going insane. Remember all these companies want from you in there money back. It may take them 30 years to get it, but they will eventually get it back.

Best wishes to you, like I said I am there with you, you are not alone....

Answer 4

You're over your limits on everything, so you probably won't qualify for a loan or another card to do a balance transfer.

Pay your minimum payments on all of your cards.

Pay the minimum plus the finance charge on your lowest balance card.

When that card is paid off, do the same with the next lowest balance. Use the additional money and spread out payments to the other cards.

It will take a while, but you'll get cleaned up.

Answer 5

First ........cut up all of your credit cards
second....organize your bills and call the credit card companies and see if you can organize a payment plan that is affordable to you.

The other option after cutting up your credit cards is to consolidate all your bills into one bill and work out a payment plan that is feasible for you.

You might want to go back to old school on purchasing things. Pay on a lay away plan, or save and then buy. it would be a good idea to figure out why you spend and what you spend the most on and what value you place on the things you purchase. Spending is as much psychological as its just spending.

Prioritize your needs verses your wants. Understand what items are luxuries and what are necessities and before you spend ask yourself "do i really need it". Needs and Wants are not the same.

Answer 6

Cancel all the accounts. Speak with someone at each to ask them to lower or eliminate your finance charges. Pay all of them on time every month no matter what, to protect your credit rating. Concentrate on the card with the highest finance charges and pay as much as you can ABOVE the minimum payment each month until it is paid off. Then take the next highest. Continue until all are paid. It might take several years,d epending on how much you owe. Don't be disheartened. During that time, buy only what you can afford to pay for. Charge nothing. Look into lots of free activities to eliminate things that drain your money, and consider giving gifts of your time and talent for holidays and birthdays instead of purchased gifts. Friends and family will understand you are trying to get your finances in line. You need it all to pay off these debts. You can come out of it, but it takes time. And when you come out of it, you will be so proud and feel so light and free.

Answer 7

Cut the cards up so that you can't use them. Pay them off.

Do NOT cancel the accounts, however. Many credit cards will jack your rate up when you close the account especially if you are in arrears!

Go to a credit counselling service and see if they can help get the interest and fees reduced.

Answer 8

How to Manage Your Credit Card Debt?
http://www.askaquery.com/Answers/qn1579.html

What is credit-counseling service?
http://www.askaquery.com/Answers/qn492.html

Answer 9

Stop borrowing money, and dont care about your credit score. Pay them off smallest to largest, don't worry about the interest rate (screw the math, it's all about attitude). After you pay off one, you can apply more to the 2nd one, once that's gone, all to the 3rd biggest, etc. Dave Ramsey calls it the debt snowball, and it works for people.

You need to change your life.. Just because banks make you THINK you need credit to live a life, you really dont. Save money and pay cash for everything. You don't NEED credit... The industry wants you to think you do, but again, you dont.

By the way, debt consolidation loans dont "pay off debt". That's what we call a shell game. You dont BORROW money to PAY DEBT. Common sense, people, common sense.

Answer 10

try to get a debt consolidation loan. Trust me, my husband and I just got through paying off our credit card debt and it took us months to do so. You might want to check into Dieteck. That's who we went through and they will work out a payment plan so you can get everything paid off sooner. Good Luck.