$32K in credit card debt at 28% interest.....

[Blueface]

.....that is what a friend told me he owes.

I ALMOST DIED!!!

I cannot imagine sleeping at night under those circumstances.
That translates to approximately $10K per year in interest alone.

I recognize life's events take one on a bad ride sometimes and those credit cards help out but, in this case, it is all attributed to trying to live a life he should not have.
This debt is due to living larger than the means to pay the debt.

I truly hope this guy is the exception rather than the rule but sadly, with today's economy, many seem to be on the same ride.

Use those cards wisely folks!!!
They are a vicious cycle if not managed properly.

[Don Fernando]

That's why I have a 1500 euro max on my creditcard (a max I never reach though). 28% is outrageous.

[Footbag]

Now that's just stupid. Unless he's got terrible credit, he's got to cut up those cards and consolidate. He shouldn't close the CC accounts though. Leave them open but never use them. It looks much better on your credit report which will allow you to get those consolidation loans.
Hopefully he's got some equity in a home. The first step to getting out of a hole is to stop digging.

[Ace$nyper]

I see this all the time, people are already figuring the loop holes of the new bankruptcy laws.

What bothers me the most, if you know how to do this, you can have a pretty darn good life and "get away" with it.

While I understand hard times, I am a grad student after all :r the majority I see is just, spending more then you have.

[ghostrider]

Just another reason I haven't owned a credit card in at least 10 years now. If you can't pay it off in a month or two, you don't need it.

[Blueface]

Just another reason I haven't owned a credit card in at least 10 years now. If you can't pay it off in a month or two, you don't need it.

They really come in handy and actually invaluable at times.
The thing to do is to manage it and not let it take over.
If you can charge what you can pay in a month or two, awesome!
If you need to charge something that you can't pay right away, look for places with "same as cash" deals, where if you pay it within the period allowed, you pay no interest.
If you can't find any "same as cash" deals and have to use a high interest card, focus on paying that off right away. It is the worst kind of debt anyone can possibly have.
I feel fortunate that my card charges me 6% and heck if they get to see much interest money out of me.
Right now, they are getting 6% on a 0 balance.

[Ace$nyper]

They really come in handy and actually invaluable at times.
The thing to do is to manage it and not let it take over.
If you can charge what you can pay in a month or two, awesome!
If you need to charge something that you can't pay right away, look for places with "same as cash" deals, where if you pay it within the period allowed, you pay no interest.
If you can't find any "same as cash" deals and have to use a high interest card, focus on paying that off right away. It is the worst kind of debt anyone can possibly have.
I feel fortunate that my card charges me 6% and heck if they get to see much interest money out of me.
Yup yup

I linked mine to do auto pay outta my checking, so it's a debit card that gets reward and ups my credit rating :ss

[markem]

A good credit counselor (or even a quick phone call) should get this reduce to zero percent. It's happened to several people I know who got trapped by the whole consumption lifestyle thing and very easy credit of the recent past.

[Blueface]

A good credit counselor (or even a quick phone call) should get this reduce to zero percent. It's happened to several people I know who got trapped by the whole consumption lifestyle thing and very easy credit of the recent past.

Mark,
I told him I was going to find some services that help out with this.
Does anyone know of any reliable ones?

I know of places that advertise a reduction in the debt, of drastic amounts but I am sure that sets one's credit back quite a bit.
I suppose to be able to reduce the interest significantly would be of tremendous help to pay the principal off rather than $10K a year in interest and never being able to get out of it.

[cricky101]

Minor thread jack, but I just tried to use a Capital One Visa card I've had for 10 years to find out the account had been closed because of inactivity. I haven't used it in two years. I've got great credit and was never late on a payment and would be, I thought, a great low-risk customer :confused:

It stinks because it was my first card - I got it when I was 18 - and the closing of the account will affect my credit score and I'm in the process of looking for a house.

Might be a good idea to make a call if you've got a Capital One card you haven't used for a while.

[Blueface]

Minor thread jack, but I just tried to use a Capital One Visa card I've had for 10 years to find out the account had been closed because of inactivity. I haven't used it in two years. I've got great credit and was never late on a payment and would be, I thought, a great low-risk customer :confused:

It stinks because it was my first card - I got it when I was 18 - and the closing of the account will affect my credit score and I'm in the process of looking for a house.

Might be a good idea to make a call if you've got a Capital One card you haven't used for a while.

Interesting.
I just went to BrandsMart a couple of weeks ago and purchased a fridge, using their "Same as cash" that I love so much, as my money is put aside, earning interest while I pay them none.
When I went to pay with their credit card, I found out it had been closed for inactivity of 1 year, not even 2 as in your case.
I had to open a new one but it was well worth it for the 12 month same as cash promo.

[cvm4]

Man, that guy needs to consolidate and figure out his budget quickly!

[Buena Fortuna]

I see this all the time, people are already figuring the loop holes of the new bankruptcy laws.

What bothers me the most, if you know how to do this, you can have a pretty darn good life and "get away" with it.

While I understand hard times, I am a grad student after all :r the majority I see is just, spending more then you have.


There are no more loopholes...that's why they can legally charge 28%. Coming out of individual BK without unsecured debt to repay is virtually impossible after the last changes to the BK laws

[Cigary]

A good credit counselor (or even a quick phone call) should get this reduce to zero percent. It's happened to several people I know who got trapped by the whole consumption lifestyle thing and very easy credit of the recent past.


If you can find a "good" credit counseling company it will pay off for you in the future because your debt will be repaid faster than you could pay it off at 28% and then you can work on your credit rating. Should you continue to pay at a rate of 28% it will take you double or tripe the time to pay it all off plus you run the risk of getting into financial problems with interest that high where you can't even afford to make the minimum payment.

[Tombstone]

Two words 'Dave Ramsey':tu

[j-easy]

three words "stop buying ****":tu

[papichulo]

Hmmm, I was debt free until my father in law had was ran over by a bus on his motorcycle in South America. I am $50K in debt on three cards, because where he lives there is not any health insurance. So what do you do? I had to do the right thing and now he is walking again. Yeah it sucks and I am stressed out to the max. When it comes to a family crisis, I had to do the right thing. Presently, I am check to check in hopes of never being in debt. I guess cigars are an outlet for my stress. Do I purchase cigars, yes, but not often. Thanks for listening to my dilemma. Chao.

[Ace$nyper]

There are no more loopholes...that's why they can legally charge 28%. Coming out of individual BK without unsecured debt to repay is virtually impossible after the last changes to the BK laws

There are, you just have to be a lot more clever, old laws it was so simple buy nice house get a degree nice car. For legal and ethical reasons I hope you understand I can not post how to pull this off. But I assure you I do know there are ways to do it.
old laws were nearly as simple as :

I don't want to pay it back.
Uncle sam : k
You hahahahaah

Now with a few K hidden away in under 1 year 700+ credit rating.

It really was that simple still rather disgusting.

[Yazzie]

.....that is what a friend told me he owes.

I ALMOST DIED!!!

I cannot imagine sleeping at night under those circumstances.
That translates to approximately $10K per year in interest alone.

I recognize life's events take one on a bad ride sometimes and those credit cards help out but, in this case, it is all attributed to trying to live a life he should not have.
This debt is due to living larger than the means to pay the debt.

I truly hope this guy is the exception rather than the rule but sadly, with today's economy, many seem to be on the same ride.

Use those cards wisely folks!!!
They are a vicious cycle if not managed properly.


Bummer! Did he get in trouble with the crazy cigar deals?

[Blueface]

Hmmm, I was debt free until my father in law had was ran over by a bus on his motorcycle in South America. I am $50K in debt on three cards, because where he lives there is not any health insurance. So what do you do? I had to do the right thing and now he is walking again. Yeah it sucks and I am stressed out to the max. When it comes to a family crisis, I had to do the right thing. Presently, I am check to check in hopes of never being in debt. I guess cigars are an outlet for my stress. Do I purchase cigars, yes, but not often. Thanks for listening to my dilemma. Chao.

Brent,
That is the kind of debt that while you may worry about it, your heart should feel good that it is for the sake of a human life as opposed to that of my friend.
His is attributed to nonsense spending that was totally avoidable. He didn't need to have those toys but just didn't know how to hold back.

[papichulo]

Thanks for the support Carlos and I was not trying to thread jack this thread, but wanted to point out that many people find themselves in debt to medical emergencies. I have been downsizing the cars and things. I know all will be well.

I failed to mention this happened a year and one half ago, maybe a little longer; however, I have been taking a beating. I took control of my issues and contacted my creditors to reduce my interest rates. For the record I will eat beanie weanies before I miss a payment.

Cheers

[BigFrank]

28% that is unreal. Seriously unreal.

[doctorcue]

Two words 'Dave Ramsey':tu

:tpd::tpd:

Dave Ramsey has such a logical sense about getting out of debt. I'm using his principles now and should be clear by year end. Suggested read for any & every one.

[j-easy]

so just out of curiosity, what did he buy with 32k?

[Blueface]

so just out of curiosity, what did he buy with 32k?

Not any one thing.
Just used the card to subsidize what he needed but more like, wanted.

[mosesbotbol]

He should close the accounts and negociate a lower interest rate. Even if his credit takes a hit, he could rebuild that later on.

[M1903A1]

Not any one thing.
Just used the card to subsidize what he needed but more like, wanted.

Famous last words....

[Scottw]

If anyone needs some help with this stuff, I am in the business. PM me an I will get back with you shortly with some help. I have done over 1000 restructurings where credit card and lease debt was involved. You will all pay the current BOTL rate which is all the advice you need for $0.00. (in other words, free).

[fxpose]

Just another reason I haven't owned a credit card in at least 10 years now. If you can't pay it off in a month or two, you don't need it.

I pay my CC balance in full each and every month so I never pay interest. The banks hate me for that. I have only one CC (same visa account for over 20 years) and I use it only for on-line purchases and payments only. Everything else, I pay cash or check. For me, it'll be inconvenient not to have a CC.

[fxpose]

He should close the accounts and negociate a lower interest rate. Even if his credit takes a hit, he could rebuild that later on.You can't close the account if there is outstanding balance.
I once bailed my wife out of her $20,000/25% account. They closed the account only after I paid the entire principle in full which I did. Subsequently, I made her close all other charge accounts. All has been well since.

[NCRadioMan]

You can't close the account if there is outstanding balance.


Sure, you can. I've done it twice in the last 10 years.

[CigarDood]

Minor thread jack, but I just tried to use a Capital One Visa card I've had for 10 years to find out the account had been closed because of inactivity. I haven't used it in two years. I've got great credit and was never late on a payment and would be, I thought, a great low-risk customer :confused:

It stinks because it was my first card - I got it when I was 18 - and the closing of the account will affect my credit score and I'm in the process of looking for a house.

Might be a good idea to make a call if you've got a Capital One card you haven't used for a while.

I had capital one do the same thing to me.

[Scottw]

Who took care of the balances or did you declare bankruptcy?

You can close the account yourself or in most cases the creditor does it for you. It doesn't alleviate the outstanding balances though.

[fxpose]

You can close the account yourself or in most cases the creditor does it for you. It doesn't alleviate the outstanding balances though.
But technically you still owe money associated with that account.

[Scottw]

But technically you still owe money associated with that account.

Yes sir you would until the account is paid off in full, settled for lesser balance and paid, discharged through a Bankruptcy or erased in instances where the statute of limitations expires.

[Studebaker]

I pay my CC balance in full each and every month so I never pay interest. The banks hate me for that. I have only one CC (same visa account for over 20 years) and I use it only for on-line purchases and payments only. Everything else, I pay cash or check. For me, it'll be inconvenient not to have a CC.

+1

It takes an emergency for me to carry a balance on a card. I use my CCs as a convenience, not to subsidize a lifestyle I can't afford. I don't care what the banks think of it, but it does wonders for my credit rating. Fills my mailbox with junk mail from other card companies too. :rolleyes:

[King James]

I'm still under my 18 month 0% interest and when that ends I think I go up to 6%. I also keep my limit low so that I don't even give myself the opportunity to fall into debt, especially this early in my life.