Credit Card Problems

Ask the credit card companies to lower the interest. Try to always pay the min. and not use the cards anymore. Also try a consolidating home equity loan or other such loan that has a much lower interest. I am somewhat there except my house is paid for but the other conditions exist and we are on a very fixed income. I wish you the best.

Times are trough, but not paying your credit cards is suicide. These should be paid before any other bills except your mortgage. Call each of your creditors, and talk to them. tell them your situation, and ask how they can help. Many companies will make small payment arrangements. Definitely negotiate a lower interest rate. Whatever you work out, stick to it! Eventually you will get out of the hole and you want to be able to rebuild your life. We have re-negotiated almost all of our bills, some payments dropped from an 80 dollar a month payment to a 20 dollar a month.

Be honest and do your part to pay a little. But - communication is the key. Dont delay - or you could lose more than you think.
Good luck!!

Hi, J.,
We have foubd ourselves in the credit cards debt up to 17,000.00 and to solve the problem I enrolled into the DMP plan (DMP stands for Debt Management Plan) with GreePath, besides I began looking for additional income and found a legit home based business which helps me earn money and manage my time asI want with my family. If you think it might help you as well you may get more information at www.gogreenandearnmoney.com
Best regards,
E. Zoueva

Hi J. what I started to do is pay my credit card bill off (its a small credit card) and charge my bills to it. That way I get both things taken care of. I do this every month. Hopefully this can work for you as well.

Hi J.,
I'm sorry you're going through this. That's really stressful! I have not been in that specific situation, but my husband and I did pay off a lot of debt several years ago after I started listening to Dave Ramsey (daveramsey.com). He has 7 baby steps for getting out of debt that are very practical and will help you figure out what to do first. Good luck!

Please don't listen to anyone that tells you to pay the credit cards before other things. Having a roof over your head, clothes on your back, and food in the refrigerator is more important than credit cards getting their money. Food, shelter, clothing, and utilities are what need to be paid first - cover your four walls and work you way down from that.

I second all the advice for Dave Ramsey - I've been on the plan for 3 years and my husband and I its a wonderful program. It's alot of hard work but it's completely worth it in the end.

Good luck.

File bankruptcy! We had to stop paying our c.cards last Sept for similar reasons. It took us about 6 months to come up with the lawyer & court fees to file, but it is better than doing nothing about it.

My brother-in-law ignored his bills and he had papers served to him, and was being harrassed, etc. (That was probably 3 or 4 years ago). His credit was obviously shot but he recently needed a new vehicle and a creditor got a hold of his new address and he was soon surprised by his wages being garnished. He immediately went to a bankruptcy lawyer and our parents helped him to file. The Lawyer thought he would be able to get his garnished wages back too (within a certain time frame).

Basically, don't just ignore it cuz it will catch up to you and you'll be stressed about it. As soon as you know you're gonna file just tell creditors that when they call you.

As soon as you actually do file, all the creditors will get paperwork and the calls will stop.

My husband and I had a TON of credit card debt a few years ago (around $35,000). We decided to consolidate and went with a company called GreenPath. What they do is negotiate a lower interest rate with your credit card companies--one of ours was at 26%, and they worked it down to 6%!!! They take the money out of your account every month and pay your credit cards for you, which is nice because you don't have to do deal with it--and you get statements from them and the credit cards to see where your money is going. We've been doing this for 3 1/2 years, and we are now down to about $9,000--so we've payed off roughly $26,000--that's huge in my book. The one downfall is that you cannot use any of your credit cards, and cannot open any new lines of credit (but cars, mortgages, loans--they don't count)--just no new credit cards. It was REALLY rough at first, and when we had our son it was hard too, trying to make ends meet and not have anything to fall back on, but we somehow have done it. And they way I look at it if I can go without using them this long, I can do it forever, and so can anyone else. I don't know about the court thing, but if you can get someone to negotiate it down, then maybe your credit card companies will be willing to work with you, as long as they knowthey are going to get paid. Good luck!!!

Hello, J. M

Life happens! DO NOT REFINANCE YOUR HOME!!! Make arrangements to lower your payments and stick to the agreement.

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1) see if the creditor will accept a lower payment in leiu of a full payment - explain your situation, if the 1st rep isn't interested, ask to talk to a supervisor until you get a yes. Also, some credit cards have programs where if you lost your job than you can get help, but I think that's an optional service that they charge for???

2) Also, you can check out debt management programs like Greenpath...yes, they charge a $50/month fee for managing your bills, but you can get the interest rates lowered and the bills will be paid on time.

3) There's also this thing called debt settlement. I can't think of the radio show that I was listening to that explained it, but these representatives can help you with lowering the principle that you pay to the lender.

My dh and I are going through the process with Greenpath and we are about half way through the program - knowing that we will be debt free at the end of it is the motivation that keeps us going. The best thing that happened to us was cutting up the credit cards!

There isn't any easy answers when it comes to too much debt and not enough money coming it, but you just have to find something that would work in your situation.

Oh, also check out the programs that the energy and electric companies have for low-income people. And I want to say that it's the Salvation Army that will provide payment for electric or gas in an emergency...you'd have to check it out, but they do more than just ring the bells at Christmas time.

Also, call the Y because they help people get connected to resources in the community/state that would help.

Also, if you are connected with a church or just your local church might be able to help, in terms of food/other needs.

You aren't the only one going through this-and you won't be the last. Good luck to you and yours.

Check out Dave Ramsey on WMUZ 103.5 FM from 7-9 weekdays and also his website at daveramsey.com. His radio show is a call in show and he offers a ton of advice on situations like yours.

Once your credit card has been in the credit bureau for 90 days you can offer them a buy out usually they will except .50 on the dollar. Most company's will even allow you to make this payment in three separate payments.
The credit bureau buys your bad debt from the creditor at a cheaper cost. So it's not really that you owe the credit card company any more. Now you owe the credit bureau. That is how they can offer to sell it to you so cheap. If you are going to court make sure you go or they can get a judgment against you and take you car or anything of value. Go and make your plea to the judge. If you miss court then the judge has no choice but to rule in the companies favor

J.,
I do understand your dilemna, this may work for you. Contact each of your Credit Card companies. Often times they will work with you. They have hardship departments. Try and negotiate with them. I also (if you can)recommend that you take insurance out on each of your cards. Yes you pay a little more each month, but the payoff is big. With this insurance, you can:
- make a payment that will go direct to the principle
- you do not have to pay interest and or finance charges
- you can freeze your account for up to 2 years if you are a displaced worker, laid off, fired, or hospitalized. You must provide supporting documentation to prove the above events.
Also, if you have insurance on your SAM's club Discover account, they will pay the entire balance and you don't have to pay it back, again you need supporting documentation. This is truly a blessing. Don't despair, keep God in your life.Things will work out for you and your loved ones. Once you get to a better place, look on the lessons learned. We must change our behavior in all areas, food consumption, spending and saving. We must change our mindset in terms of wants vs needs. I am not preaching, we are all guilty of over spending, but with our economy the way it is, we are being forced to re-think how we live our lives. Good Luck
L.

Dear J.,

You are certainly not alone. These days have been challenging for many of our budgets. Let me first say that you are very smart to catch up on your home and vehicle first and let the credit cards wait. Depending on how long you have been putting them off already, it could be quite some time before they get around to suing you. By that time, hopefully things will have turned around and you can pile up some cash to settle up with them. In the meantime, if you do not already have one you and your hubby need to create a budget. Give every dollar a purpose on paper before the month begins. Drastic times call for drastic budgets, so prioritize food, housing, car, and utilities.

Hopefully, you have cut up all credit cards and pay only with cash or debit cards (be very careful not to overdraft). Get on a very lean grocery budget. The new Aldi store in Howell can help you tremendously in getting the most for your money in the grocery department. Thrift stores can supply clothing items that are absolutely necessary. Sell anything that you do not need and pile up an emergency fund, about $1000. Without that any little emergency (say a kid gets sick, or you have a little fender bender) becomes a huge deal. Work on that while you keep your house, car, and utilities current. Then you can start looking for cash in your budget to settle your responsibilities with the credit card companies. In the meantime they are going to be calling you all the time, just let them know that you don't have any money right now and you will call them when you have some. When you do get a reasonable amount to offer call up the first one and see what kind of deal you can work out, not payments, a one time cash settlement that releases the debt. Make sure you have appropriate documentation before you actually send them that settlement money.

I personally love the financial advise of Dave Ramsey. If you would like to check it out I think you will find a lot of good advise and encouragement at www.daveramsey.com and you can listen to his radio program on WMUZ 103.5 FM at 8PM weeknights. You may also download his podcast and listen when you have time. It is very important that you and your husband are both on the same game plan concerning the budget. This has to be a very stressful time for you both. Protect your marriage and work as a team, you will be unstoppable.

Keep us posted.
J.