what is the best way to pay off my $10k debt?

Question

Ok-Im not looking for people to tell me I am stupid for wanting a loan to pay off my bills. I could go to my parents for that. I need to know the best options for me such as consolidate, get a loan, or just go bill by bill and pay it off. Please keep all snotty comments to yourself. I am here for help, not put downs. Thanks.

Answer 1

First things first - From this day forward - you must live on CASH BASIS. No more debt accrues. NONE. Cut up your cards if you must. Some people like to keep one general Visa/MC frozen in a block of ice for emergencies.

Next, assess the rates are on your outstanding debts. Sometimes consolidation saves you $, sometimes it does not. Obviously, it does not make sense to consolidate ALL your bills to a single rate if it means your interest rate will go up on a few bills.

If you go bill by bill, pay off the highest interest rate first. Maintain minimum payments on all your others, and dump as much as you can into that one bill until it is paid off. Then choose the next highest rate, and so on.

I played the credit card offers against each other, transferring balances at temporary low rates for a short period, and transferring again to a different company's special rate when my temporary rate was about to increase.

I have been debt free for over 2 years now (except for an affordable house payment). I have built up some savings and we are remodeling a bathroom on a cash basis. Keeping to a monthly budget (tracked in a spreadsheet) helps us to remain debt free and save for major purchases.

For other money saving tips, email me. We are family of 5 living on one income. I KNOW how to pinch a penny!

Answer 2

The absolute best way is to pay it off yourself. That means getting on a written budget. Give every dollar a name and a mission.

Consolidation loans will end up costing you more than it you pay it off yourself. These loans look good upfront because of the lower interest rate and payment. However, you end up paying for a longer time. You end up paying more.

Borrowing the money from your parents will change the relationship. The borrower is always slave to the lender.
Plus, you've learned nothing if your parents give you the money. You will not have changed your spending habits at all, so the likelihood is you will find yourself in this position again.

Now if they want to give you the money with the agreement that this is a once in a lifetime offer then go for that.

Answer 3

What I have done with paying back my 2 loans (an ~$8k and ~20k loans) is use MS Excel. Excel has a built-in "Loan Ammortization" feature, granted it may not be quite the same as credit card debt, but it might help you look at options. You enter the balance, interest rate, time of loan, and it gives you everything including the total interest you'd pay. It allows you to make one-time lump some payments and recalculates things. It has helped me to split up my early payments between the 2 loans so that I pay the minimal interest possible. It does the same calculations that banks do when you ask for a loan.

Answer 4

Forget about consolidation or other debt solution companies. Pay it off yourself. It will take you 3 or 4 years but you will learn a valuable lesson and are less likely to be so far in the hole again.

First, rethink your spending habits. Make a strict budget. Eliminate all the extras -- premium cable and interenet, cell phone, eating out, new clothes, etc. Take every penny you can squeeze out of that budget and put it on the highest interest rate debt while paying minimum on the rest. When that highest interest rate debt is paid off, go to the next one till they are all paid off.

You might think of ways to increase your income -- second job, garage sale, etc.

As you pay down the debt and establish a good payment history, your credit score will start to improve.

Answer 5

I am in the same boat as you, only double...I have $15 k in school related loans and $5k in credit card debt from being in college...after a year of living on my own after school and struggling to pay for my expenses, I did ask my parents if I could move in temporarily to pay off my debt so I could start saving money and not have to depend on them if I got in a jam. I started by paying off the highest interest first, and then I will tackle the federal loan, which has the lowest interest rate. It alll depends on what you are willing to give up to pay off your debt. I wouldn't suggest taking out another loan to pay off what you have. Make the necessary sacrifices and you can be debt free for good. Good Luck!

Answer 6

well if it was me i would go down the line and pay off the bills one by one -- 10k is not the end of the world -- i would pay the Mimi on each and take all extra money and throw at the one with the highest interest rate. then work your way down - if you have one that has a tiny balance --it would be OK to pay it off so you could have a confidence builder. unless the cards have a yearly fee do not cancel them. i have faith in you and i know you can work this out yourself good luck

Answer 7

it was suggested by someone lady who runs a home/shelter almost and she holes workshops for the ladies!

Get your credit report and start at the lowest ammount owed!

pretend with me here that there is a debt for company A, Company B , C , D, and E

here is our debt
A - 35
B - 100
C- 200
D - 60
E - 400

Now here is how you set it up so you get them paid off...
A, D, B ,C, E are in now in order by amount!
Lets say we have 100 a month to pay on debt!
so we need to break it down can we pay any debt off right now with this 100 dollars - yes 2 of them and have 5 bucks left over!
so now A and D are gone
we have B, C, E
now we put that 100 split it up half of it goes to your next in line so 50 off company B then 25 bucks on the other onse!

hope it makes sence!

Answer 8

The very best way to get out of debt is to rework your personal budget to cut out things you don't really need, then use all of your 'extra' money to pay off your bills one at a time...starting with the bill with the highest interest rate, and working your way down the list.
Make a game out of it. Think of it as a battle, with each bill as an enemy, and then knock them off one by one! By the time you've eliminated all your debt you will feel very empowered.
But don't return to your high-spending ways, you can use your new money-management skills to start building up your savings instead!

Answer 9

Cut your expenses to match what you make. Stop using the credit cards completely. Make a strict budget. Eliminate all the extras -- eating out, new clothes, cell phone, alcohol, premium cable and internet, etc. Take every penny you can squeeze out of that budget and throw it at the highest interest rate credit card. Find ways to bring in more cash. Have a garage sale, collect alum cans, get a second job.

Answer 10

You can try this http://cash-available.com/RepayLoan