How to be debtfree?

Question

Trying hard to clear off my debts (credit cards) but it seems that the interests are always snowballing. Is there a way to pay everything all at once?

Answer 1

Consolidate everything into 1 low payment. And if you have a home, take out a loan to pay off the credit cards. At least the interest you pay on your home loan is deductible but the interest you pay on credit cards are not.

Answer 2

If you have a piece of property that you can borrow against, you can get a refinance loan to pay off your other credit. This is often a very good thing to do because you get considerably lower interest rates and you can pay the debt off faster.

If you don't have any collateral to borrow against, usually, it's easiest if you pay off the smallest debts first.

After that, it depends on how badly you want to be debt free. If it were me, I would work two or three jobs as an abject slave until at least half of them were paid off. (This is because I believe that credit card companies are Satan's agents and you have to sell your soul to them in trade for credit.)

I live debt free right now, even rent free and car payment free. Let me tell you, there is no other way to live. The freedom is invigorating! All of my money is finally really all mine! (Now if I could only get rid of taxes...)

Answer 3

Call all the Banks, closed all the credit card account, and negotiate with the Banks on instalment payment with a lower interest. If you don't closed the account and just pay the minimun amount, you may take more than 10 years to clear just one card.

Answer 4

Try reading Dave Ramsey's book financial peace. He suggests paying the minimum on all bills with the exception of putting as much as possible towards the lowest balance bill, then when its paid move on to the next lowest balance. The premise of the lowest balances first is it frees up greater sums of money as you pay them off so you can put towards the larger bills. Also, you see result quicker and feel like you are not just spinning your wheels. Home equity and consolidation are also options but you are actually maintaining the same amount of debt.

Answer 5

You should get a debt consolidation loan and then get rid of the credit cards. You will have one repayment then and the extra cash you have you must save it.

Answer 6

Get another credit card and transfer all accounts to that one. Then, you will be able to use your old credit cards to charge and you will have extra on the new credit card to charge. That is why there are so many who file for bankruptcy.

Answer 7

Best way to pay off debt is to increase your income or decrease your expenses. The extra money you free up can be used to pay down debt. The biggest ways you can do this are in expense categories that are recurring--those you must pay every month that represent a big part of your income. The quickest to address are downsize your car expenses ASAP. You can do this by selling what have at top price as listed on KBB.com private party value. If you take your time selling you should be able to get "Private Party" value for your car. Then plan to buy a lower cost, reliable used car that Consumer Reports rates as most reliable. That way you can minize your repair costs--this is typically a huge ongoing expense for most people. I have four older cars that are of these types that Consumer Reports recommends most reliable: Honda civic and Odyssey, Ford escort and Suburu (mine has 284,000 miles on it). Also, these cars get good gas mileage. Another priority when you buy to help you save $. When you buy use KBB.com and try to find cars selling for well under the Private Party value. I always buy well used cars this way. I wait until I see one advertised well below the private party value, then I call asap, give seller a $50 deposit and write up a contract I will buy it subject to my mechanic finding no major problems. You want to buy an older car for cash (like $1,500) so you don't have to pay any collission or other extra insurance and that reduces your expenses more. I have a Ford Escort wagon (I like wagons and vans because cops pull you over less on these family cars--we have way too many cops, not that I get tickets. But I just like to be left alone, I digress . . .) I bought my Ford Escort wagon for $1,500 five years ago and it has 180,000, miles and looks great, drives like a dream and has had the lowest repair cost of any car I owned. That is my dream car because you can buy them so cheap, about 1,000 for a 1993 easy. Then be sure you shope insurance coverage among various companies--Geico tends to have cheap coverage--to get lowest cost insurance. If you own a home, you can do that same idea by looking for a bargain house. With the depressed market this is a great time to buy a fixer upper well below market to reduce your housing expenses asap. Sell your current home at market rate. If you rent, you need to own because you reduce your expenses by deducting the payment from your taxes. If your credit score is above 500 you should be able to get a loan or find a lender who can help you get your credit score up. By the way, better to buy one of those well used cars with a loan to reduce your car expenses. In general you need to become a serious bargain buyer on quality cars and on houses. You can find bargain houses on the HUD website of foreclousres using a realtor. Just be sure to bid way low on HUD foreclosures--realtors will suggest you bid too high. Be cheap, cheap, cheap and you will reduce your monthly expenses on these things.

One other point, if you find yourself overspending on consumer stuff you buy, you need to get self control. Best way to do this is not a budget but fasting. Start skipping a meal and then work up to where you skip food one day per week. I fast a day a week regularly and am unbelievalbe disciplined. I must be because I provide for a family of 6: with 5 older girls, two in college, etc. Talk about expensive! But I never buy anything in a store on impulse because fasting has trained me to be way disciplined.

Source(s):
KBB.com used car values
Zillow.com home values. Multiply the value they give you by 1.15 and you will be close o market value. Also look at comparable sales on that web site for a per square foot value to apply to the home you are considering. Watch out with realtors. They tend to push you to pay too much but you must use a realtor to buy a HUD foreclosure. You can shop other bargain houses with motivated

Answer 8

consolidate....