Question by lauren london: Have you ever heard of debt management (not debt consolidation) and if so, do you think it is beneficial? Why?
I make about ,000/year and I currently owe approx. ,000 in credit debt alone. That’s not including my car and student loans plus I still have rent to pay etc. I do not want to file bankruptcy if I don’t have to. I also would like to stay away from consolidation. My credit is average considering I have a high debt to income ratio, but I pay my bills on time.
Today, I was told by a company that they have something called debt management. I’ve never heard of that, but they said unlike debt consolidation where they lower both your interest rate AND balance, all debt management does is get the creditor to lower the interest rate. I would pay a monthly payment to the company and a monthly fee and they would make my payment for me.
At this point, I can only make minimum payments and my balance is going nowhere…Should I give debt management a try?
What are your thoughts and please state why or why not. They said this will not negatively affect my credit score.

Best answer:

Answer by nljth123
I’ve used a debt management program from CareOne Credit. It was the best thing I’ve ever done. They worked with my creditors, reduced my interest rates and consolidated all of my debt so I only had to make a single monthly payment. I was able to pay down about ,000 in debt in three years. It helped me become disciplined about managing my bills and credit and forced me to stop using credit cards.

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Question by alirealtor: Overwhelming credit card debt, but never late yet, what to do?
I have about ,000 in credit card debt. It’s a combination of lotsa medical debt and rolling over lots of other stuff. Don’t judge, I already know I’m in trouble.

I have NEVER been late on a payment (on anything, ever). The debt is spread over 5 cards and ALL BALANCES are at 3% interest or lower. The balances are such ,000, ,000, ,000, ,000 and ,000. On these I pay 0, 0, 0, 0, and 0 per month. I also have 2 other cards available with k limits each – in case balance transfer is suggested by someone.

With the housing market as it is, I cannot get a home equity loan to consolidate debt. I also have k in student loans.

My monthly bills are making it so I CANNOT make ends meet. Rather than have any missed payments or late payments, I put groceries and gas back on the credit card I’ve just paid on time. This is NOT RIGHT, but I don’t know how to stop this evil cycle I’ve gotten myself into.

I buy generic, cut coupons, conserve electric and water, and penny pinch like crazy. I pay extra on bills when I can, but that bites me in the ass when auto insurance or HOA dues come around and I don’t have any money saved and just end up putting those on the credit card again.

Any suggestions?

- I’ve always had a great credit rating, despite my credit card debt. I’m not sure if a consolidation loan or trying to settle on a few cards would be the best bet. I have no collateral to offer for a consolidation loan. I’ve already ebay-ed everything I can for some living expenses cash. And IF I could get a credit card to settle (which I doubt they would because I’ve never made a late payment), I have absolutely no cash lying around to pay the settlement amount…so prior to trying to settle, I’d probably want to get that cash from a totally different credit card and have it ready to pay the settlement amount.

ACK! What has happened to me?? Please help with good suggestions and not yell at me for falling into this mess – my stress level and health has already suffered due to this mess. Thank you.

Best answer:

Answer by Tim
stop charging on the cards.

If the interest is 3% or lower that is really low. Lower than getting a home loan. Just pay as much as you can on each one until they are paid off.

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Question by Berry: Is debt consolidation right for me?
I am a 24 year old female with about 6K of debt. I owe about 00 in back taxes, 0 in medical bills, 00 in student loans, and a few other random bills that I haven’t been able to pay. I currently have two collection agencies coming after me, and my credit is pretty much ruined because of it.

I was laid off about 3 months ago from my job and am currently collecting unemployment while I desperately search for another job just so I can stay on top of my bills. Two years ago I had nearly perfect credit, but I’ve just had one thing on top of another go wrong!

I am stressed beyond belief now, and I am contemplating using a debt consolidation service to manage my payments. My other option would be to get a credit card to pay them off all off just so I only have the once a month credit card payment instead, but my interest rate is going to be ridiculously high.

Anyone with financial knowledge….what’s my best bet at this point? I want to fix this now so I can build my credit back up!

Best answer:

Answer by Qari
all this and you are also overweight…stop running away from ur drama by eating and making you feel better…
1-proper diet
2-steady and proper exercise…
3-debt conso is a horror show unless you do it urself….
4-who would give u a cc with no job….even if….getting into more debt especially without a job
is another horror show…
contact each acct you owe money to and come up with a payment plan that u can afford….
it must be realistic and you can not breach the new agreement….
get a job as a waitress……yes you can do it….
your small amount of debt will disappear shortly….stick with the plan..

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Question by Ray C: Where do I start? Deep in debt and terrible credit, I finally have a new good paying job but is it too late?
I just finished college and I’m about 00 in the hole with credit cards. about 00 of it is in collections…but it’s not a third party collections company if that matters, it’s still within the credit card company. My grace period for my student loans (000) just finished and now requires payement. my credit score is in the 500s. Since I have graduated I have finally been able to make decent on time payements, but my interests rates are ridiculous and my payments aren’t doing much of a dent, I’m paying about 0 on my cards a month which half of it almost goes to interest. i can’t qualify for anything financial like consolidation loans…what do I do? im desperate and want to fix it…who do I go to? should I get someone to come in a straighten it out, or can I should I take care of it myself? my budget is tight with my other bills since i live alone and have to take care of rent, insurance, student loan payements, etc. on my own. I tried to call one of my credit card companies to lower the interest but they said I had to go through a debt consolidation company in order for them to lower it. is it best to go to someone?

Best answer:

Answer by abradley57
The only way to get your interest lowered, an possibly your debt, is to go through a credit counseling company. Check them out carefully though, because they’re not all the same and they don’t all do the same job. What they will do is negotiate a lower interest rate with all your debts. You will make one payment to them and they will make the payments to each of your debtors. You’ll pay them off faster than if you do it yourself. Another option os to go to an attorney that handles this. He can do the same or possibly better job. It just depends on his experience. Make sure whoever does it puts in writing what they are saying they will be able to do for you before you sign anything.

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Question by jenniferjune2287: Debt consilidation advice?
I have a small car loan (about 00) and student loans (totalling about ,000). I know I am going to have trouble paying both. Is it a good idea to dip into a debt consolidation loan, or whatever it is? All I know is that these businesses pay off your “bills” like these (credit cards and whatnot, your debt), and you pay them in one easy payment, but with inflated interest rates. For a person who makes a maximum of 0 a week, would you recommend this as an option?

Best answer:

Answer by hollrock
This isn’t a direct answer but maybe you’ll get more specific and solid advice from Suzie Orman’s Fabulous and Broke book. My financial situation is much more extreme, but when i looked at that book i felt like it was a great guide for general population in debt.

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Question by DuceDuce: Debt Consolidation or Debt Help?
I have a little less than 10,000 credit card debt that I am trying to get rid of it. I haven’t used any of the cards in over a year. It is a total of four cards that rage from 20%-25% in APR. I have never missed a payment or have been late but it seems like I will never pay them off. I always pay more than the minimum payment also. Recently I have been getting alot of offers for credit cards with 10% and 12% APRs. I was wondering if there was a loan that I would be able to get with lower interest rates to pay off those credit cards and close them out, and I just pay the loan off in the amount of time agreed. For example such as an auto loan or home loan where you know you pay a certain amount and in so many years you are done. With these cards it seems like there is no end in sight. I don’t have any collateral either. I was wondering if anyone knew of any programs out there that might be able to help me. Here are some other expenses that I have every month.After taxes I bring home 00-00 a month
0 House Note
Car insurance
Truck Insurance
9 Student Loan Payment
0 Child daycare expenses

Capital one Card about 00.00 owed 22% APR
Chase about 00 owed 21%APR
Best Buy Card about 00 owed 22% Apr
Macys Card about 00 owed 25% Apr

Just looking for some advice. Thanks.

Best answer:

Answer by Kyle N
Ok, luckily you are not in a mountain of debt. It’s a hill, but not a mountain. Thank you for being wise enough to seek help with it early! I’ll lay out two options for you that are both great. They will both hurry up the process, and start to cut down the debt very quickly.

Option one: I see you are paying maybe 0 a month or so on the cards right? I figured your utilities and groceries take up some of the extra money.

So lets do this, figure out exactly how much you pay, since you are paying over the minimums right now. Look at the minimum payments on each card. Now we are going to take all the extra you’ve paid towards the others on a regular basis, and push it all to Macy’s. Capital One, Chase, and Best Buy will get their turn for the extra money in a few months. In the mean time, you’re going to pay just the minimum on Capital One, Chase, and Best Buy. With all of the extra you put to Macy’s you should have that paid off pretty quickly. Here’s where it speeds up. When you are done with Macy’s, take all the extra, and the Macy’s minimum and add it to Best Buy. So now you’re Best Buy payment looks like this (Original Best Buy minimum + Macy’s Minimum + all the extra you were paying) = one big payment. That will take care of Best Buy even faster. Then, you do the same thing to Chase, so the new payment looks like this (CHase minimum + Best Buy Minimum + Macy’s Minimum + Your extra you were originally paying) = an even bigger payment! Then by the time you have those 3 done, Capital one will go even faster!

The second option, not as fun or attractive, going to your bank and hoping they approve you for a personal loan of 10k, which may or may not happen, and they may bump your payments higher than they are now due to a shortened time frame of 3 to 4 years.

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