in regards to my last question, i guess what im asking now is what can i do if i owe about 11 to 12 grand?

Question

what is my best option? i feel like i pay and pay but none of my cards go down.

Answer 1

First round:
1.Lock your credit cards in a safe and loose the key – do something so you don’t use them again, but don’t close the accounts.
2.Call 1-888-5-OPTOUT (1-888-567-8688) and remove your name from direct marketing lists – don’t apply for new credit cards no matter how tempting the offers are.

Second round:
3.Sit down and create a budget.
a.Write down your salary and/or other income (net income – after taxes)
b.Itemize your ‘standard expenses’ (rent, utilities, food – not eating out, etc.)
c.Itemize your ‘other expenses’ (transportation, car payments, gas, entertainment – including food at restaurant, clothing, etc.)
d.Itemize your credit card debt ‘bad debt’ (total amounts)
4.Try to reduce ‘other expenses’ if you can, especially the entertainment expenses, which includes going out, movies, shopping with no reason etc. If you’re really serious about getting out of debt, you’ll be surprised how much you can save from this category (believe it or not but nothing is going to happened if you don’t join your friends two weekends in a row at that night club in downtown - try, or if you don’t have the most expensive shoes)
5.Now subtract all your expenses (don’t include bad debt) from your income and write down the difference. Subtract 15% off the difference and start saving that for emergency purpose. The rest, let’s call this bad debt funds (BDF) you use for Third and final round - continue reading.

Final round:
6.Write down the minimum payments and APR next to the total amounts (see 1. d) above) for each credit card that you have
7.Add all the minimum payments and subtract this from the BDF.
8.Use what’s left from the BDF and apply toward the credit card that has the highest APR and lowest balance (if the credit card with highest APR has the highest balance apply BDF there)
9.After you pay card 1 apply BDF + the minimum that you are already paying to card 2 (highest APR and lowest balance).

**Bullet 5. expects that you have a well positive number after subtraction, if not that’s a different story. Ask a new question.

Answer 2

Depending on how your credit is and whether you are eligible for other cards one option is to open another credit card account that has a introductory offer like a low interest or even 0% for the first 6-12 monthes and free or low interest balance transfers, this are very easy to find depending on your credit, transfer the balances from your highest interest cards onto this to take advantage of the savings in interest but please don't use the card for any new charges and be diligent abt paying because once you have a late or misses payment the offer cancels out and they start charging regular interest for everything

Of course you're feeling like your paying and nothing goes down because you're total interest alone is most likely OVER $150/month, the smartest thing you can do is get a lower interest loan, such as a student loan or a personal loan and use that to pay down the credit cards to save money on the interest expense you're paying every month.

I don't know you're financial situation but I think that maybe if you can scrounge up some extra cash each month, either by working more or spending less, send it directly to the card companies. If you get paid on a weekly basis, send a specific amount (be it $100/wk or 25% of your pay) directly to the card companies EVERY week, don't even wait until the payment is due, remember interest is compounded daily. I know it seems like a huge sacrifice now and you may think you can't afford to make payments that high but if you need motivation let me know and I'll break out my TI-89 and crunch the numbers for you so you can see how you can't afford not to. You'll be saving so much in the long run by making large payments now.

Answer 3

Use the "snowball" technique
List all the debts you have with the total to pay them off and the cuurent minimum payments
Then start with the SMALLEST one you have. Dump everyhting you can onto the debt until is gone
Then you take the money you were paying on that bill every month, add it to the amount you are already paying on the next smallest bill and get that one paid off
Then take the amounts from 1 and 2 and dump them on 3.
By the time you get the first 5 or 6 knocked out, you will be able to make big payments on the rest
Take them one by one until there are all gone

But first -- CUT UP THE CARDS so you can't run up more debt.

Answer 4

Are you still spending on those cards?

If you can pay at least $1,000 a month and do not charge anything else, your balances will be zero in 16 months.

Paying that much out and not spending what you don't have requires quite a lifestyle adjustment.

You have to come to terms with the fact that the lifestyle you are leading is not the one you can afford and go from there. A consolidation loan will not do you any good if you don't have your spending under control.

Answer 5

Listen to Suze Orman(check your TV listings for her show.) She is a great teacher when it comes to getting out of debt and making your money work for you.

She will say take your highest interst card and work to pay it off first. Then repeat the process untill you are done. With each one you pay off, you will see a difference in how much money you have to put towards your debt.

If you have trouble not spending on a credit card once it has no balance, stick it some water and put it in the freezer. If it is the one with a high interest rate, cut it up, as you pay off your debts you will be getting better offers for new lines of credit. That doesn't mean you should take the offers, though.

Answer 6

That's because they don't. If you simply make minimum payments, it can take 20 years to pay off a credit card. What you do is start paying more than the monthly minimum. If you can't afford that right now, go to one of any number of debt consolidation outfits to come up with a longer-term loan that has payments you can afford. Then start pre-paying that one.

Paying off $12,000 in 10 years will cost about $200 a month for a total of more than $24,000 dollars. Any way you can find to reduce your interest rate is going to be good, and debt consolidation is a good option for that.

Answer 7

don't go down the debt consolidation route it ends up costing you more (speaking from experience). The best thing I have found is to move my debts onto intrest free cards. That way the monthly payments you make are going towards the debt and not just the interest. You need to make sure that if you are paying interest on the cards you are not just meeting the min monthly payments. This is more interest than debt. Pay as much as you can afford toward your debts every month. Get yourself a budget and stick to it. don't buy anything or go on holiday until you can afford it. This plan is working for me.

Answer 8

I wouldn't go with the debt consolidation places that specifically do just that because they charge high and I believe it ultimately affects your credit. I would go to a local bank or other lending institution and get a consolidation loan. The chances of getting it are pretty good depending on your credit because they take into account the debts that will be paid off with the loan and they make that payment directly to the creditor for you.

Answer 9

Debt consolidation companies should be your last resort. If you own a home then you can take a home equity loan out to pay your cards off. It's MUCH lower interest and that interest is deductable (in the US) from your personal taxes. However, if you don't own a home then maybe this credit card payoff calculator will help. Sometimes it helps to focus on your goal more clearly or to see it in writing to accomplish it- good luck!

http://www.ditech.com/calculators/creditcard.html?overtureGEO

Slainte,


-D

Answer 10

I know it sounds corny, but look into Oprahs debt diet! I know alot of people it has helped, they have good information on getting your credit cards down fast if that is your problem. You can learn what steps so you can get out of debt in a few years and not ever be in it again! I'm still getting out of debt from college and bad credit, but in two years my credit should be back to good again so we can buy a house. Its very important you start thinking about that now because you never know whats going to happen 5-10 years from now when good credit and no debt is very important!