Comments for Bad Credit Debt Relief http://www.financecreditaid.com Answers To Common Debt Questions Sat, 28 Mar 2009 20:06:01 +0000 hourly 1 http://wordpress.org/?v=3.3.2 Comment on I recently graduated and have about 30K in debt, what is the best strategy for paying off the debt? by Jeanne R http://www.financecreditaid.com/i-recently-graduated-and-have-about-30k-in-debt-what-is-the-best-strategy-for-paying-off-the-debt/comment-page-1/#comment-562 Jeanne R Sat, 28 Mar 2009 20:06:01 +0000 http://www.financecreditaid.com/faqs/i-recently-graduated-and-have-about-30k-in-debt-what-is-the-best-strategy-for-paying-off-the-debt/#comment-562 Please do not consolidate. It is not free, they will lower your payments by increasing the length of time until you are debt free, and you will take a hit on your credit score. Or they negotiate your debt down after telling you not to pay for awhile adding another hit to your credit score. There is a better way. A. Have a garage sale and sell anything that you no longer need or want. B.Get a temporary part time job, if you have one, get another. Here is a plan that can help you. If you work the plan, the plan will work for you: 1. Make a budget. Make the budget a week before you get paid. A budget is not a punishment! It is a tool which will free you from ever having to worry about money again. Put everything in your budget. Especially those annual, biannual, or quarterly bills like car registration, insurance, etc. Give every dollar you are going to bring home the name of where it is going. Add an "emergency fund" category to your budget for 25 dollars and save up until you have 1000-1250 dollars. Your emergency fund will help keep you from getting into new debt because of an emergency. If you can, set up a direct transfer to a savings account for your emergency fund. That way it moves automatically and you don't even have to worry about it. You must cut your spending and live on less than you make. 2.First get current on all of you debts and make no more late payments. Stop using your credit cards immediately. Do not take on any more debt. Credit cards are like quicksand only the death is much slower. Make a list of all of your debts in order of highest interest rate to lowest interest. Use cash only for your spending from now on. 3.Pay the minimum due on all of your debts and then put your extra money towards paying off the highest interest one first. After you get that one paid off, you put the money you were paying on debt #1 (the minimum payment and the extra payment) towards debt #2. That will pay debt #2 off faster. When that is paid off, you put all three payments towards card #3 and that one will be paid off pretty quickly. As an example: To start : Debt #1 (highest interest): minimum payment+ extra payment Debt #2 (middle interest): minimum payment Debt #3(lowest interest): minimum payment Debt #1: paid off Debt #2: minimum payment from Debt #1+ Minimum payment from Debt #2 +extra payment Debt #3: minimum payment Debt #1: paid off Debt #2: paid off Debt #3:Mimimum payment from card #1+ minimum payment from Debt #2+ minimum payment from Debt #3+ extra payment. That way, you will get them all paid off, on time, and pay the least interest. It will also help towards rebuilding your credit since you will no longer have any late payments. This works no matter how many different debts you may have. 4. After you get all of your debts paid off, add to your emergency fund until you have 6-12 months of income saved up. Put that emergency fund money into a liquid money market fund or into a Bank of America no-risk CD so that if you need the money you can take it out without penalty. 5a. When you have your emergency fund in place, add a category for "fun" to your budget. Save for a holiday, a vacation, a big screen, or dinners out, whatever goal you want. Remember to enjoy your life. 5b. When you have your emergency fund in place, start saving for your retirement. Join the 401(k) plan at work and contribute the maximum. Your employer probably matches at least part of your contribution so why give up free money? Open a Roth IRA and contribute the maximum on a monthly basis. If you start saving for your retirement now, you will probably retire a millionaire. 5c. When you have your emergency fund in place, start saving for your next car. Only buy cars, or other things that depreciate, with cash. Save up for a nicer car. That way you get the interest instead of paying the interest. You can do it and it isn't as hard as you think. Just follow the plan. Please do not consolidate. It is not free, they will lower your payments by increasing the length of time until you are debt free, and you will take a hit on your credit score. Or they negotiate your debt down after telling you not to pay for awhile adding another hit to your credit score. There is a better way.

A. Have a garage sale and sell anything that you no longer need or want.

B.Get a temporary part time job, if you have one, get another.

Here is a plan that can help you. If you work the plan, the plan will work for you:
1. Make a budget. Make the budget a week before you get paid. A budget is not a punishment! It is a tool which will free you from ever having to worry about money again. Put everything in your budget. Especially those annual, biannual, or quarterly bills like car registration, insurance, etc. Give every dollar you are going to bring home the name of where it is going. Add an “emergency fund” category to your budget for 25 dollars and save up until you have 1000-1250 dollars. Your emergency fund will help keep you from getting into new debt because of an emergency. If you can, set up a direct transfer to a savings account for your emergency fund. That way it moves automatically and you don’t even have to worry about it. You must cut your spending and live on less than you make.

2.First get current on all of you debts and make no more late payments. Stop using your credit cards immediately. Do not take on any more debt. Credit cards are like quicksand only the death is much slower. Make a list of all of your debts in order of highest interest rate to lowest interest. Use cash only for your spending from now on.

3.Pay the minimum due on all of your debts and then put your extra money towards paying off the highest interest one first. After you get that one paid off, you put the money you were paying on debt #1 (the minimum payment and the extra payment) towards debt #2. That will pay debt #2 off faster. When that is paid off, you put all three payments towards card #3 and that one will be paid off pretty quickly. As an example:

To start :
Debt #1 (highest interest): minimum payment+ extra payment
Debt #2 (middle interest): minimum payment
Debt #3(lowest interest): minimum payment

Debt #1: paid off
Debt #2: minimum payment from Debt #1+ Minimum payment from Debt #2 +extra payment
Debt #3: minimum payment

Debt #1: paid off
Debt #2: paid off
Debt #3:Mimimum payment from card #1+ minimum payment from Debt #2+ minimum payment from Debt #3+ extra payment.

That way, you will get them all paid off, on time, and pay the least interest. It will also help towards rebuilding your credit since you will no longer have any late payments. This works no matter how many different debts you may have.

4. After you get all of your debts paid off, add to your emergency fund until you have 6-12 months of income saved up. Put that emergency fund money into a liquid money market fund or into a Bank of America no-risk CD so that if you need the money you can take it out without penalty.

5a. When you have your emergency fund in place, add a category for “fun” to your budget. Save for a holiday, a vacation, a big screen, or dinners out, whatever goal you want. Remember to enjoy your life.

5b. When you have your emergency fund in place, start saving for your retirement. Join the 401(k) plan at work and contribute the maximum. Your employer probably matches at least part of your contribution so why give up free money? Open a Roth IRA and contribute the maximum on a monthly basis. If you start saving for your retirement now, you will probably retire a millionaire.

5c. When you have your emergency fund in place, start saving for your next car. Only buy cars, or other things that depreciate, with cash. Save up for a nicer car. That way you get the interest instead of paying the interest.

You can do it and it isn’t as hard as you think. Just follow the plan.

]]> Comment on How do you collect a debt from a person who is declaring bankruptcy? by melvinschmugmeier http://www.financecreditaid.com/how-do-you-collect-a-debt-from-a-person-who-is-declaring-bankruptcy/comment-page-1/#comment-489 melvinschmugmeier Sat, 28 Mar 2009 04:00:06 +0000 http://www.financecreditaid.com/faqs/how-do-you-collect-a-debt-from-a-person-who-is-declaring-bankruptcy/#comment-489 Send a lot of letters putting you in line with the other creditors. When they file bankruptcy they will need to sell assets to pay off creditors. You probably wont get all of your money, but you'll get something. Send a lot of letters putting you in line with the other creditors. When they file bankruptcy they will need to sell assets to pay off creditors. You probably wont get all of your money, but you’ll get something.

]]> Comment on Is there any option for debt consolidation if you are NOT in default with good credit but no equity? by Ankita http://www.financecreditaid.com/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/comment-page-1/#comment-486 Ankita Fri, 27 Mar 2009 15:31:47 +0000 http://www.financecreditaid.com/faqs/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/#comment-486 If you really need some help, I will suggest you a site. Where you can get your Consultation free of Charge! No credit check required to get started with your free debt consultation. :) If you really need some help, I will suggest you a site. Where you can get your Consultation free of Charge!

No credit check required to get started with your free debt consultation.

:)

]]> Comment on I recently graduated and have about 30K in debt, what is the best strategy for paying off the debt? by captkev http://www.financecreditaid.com/i-recently-graduated-and-have-about-30k-in-debt-what-is-the-best-strategy-for-paying-off-the-debt/comment-page-1/#comment-561 captkev Thu, 26 Mar 2009 08:09:35 +0000 http://www.financecreditaid.com/faqs/i-recently-graduated-and-have-about-30k-in-debt-what-is-the-best-strategy-for-paying-off-the-debt/#comment-561 You should always strive to pay off debt quickly. However you should also prioritize the higher interest rate debt first. This site helped me in reducing my debt considerably. You should always strive to pay off debt quickly. However you should also prioritize the higher interest rate debt first.

This site helped me in reducing my debt considerably.

]]> Comment on Is there any option for debt consolidation if you are NOT in default with good credit but no equity? by Ervin http://www.financecreditaid.com/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/comment-page-1/#comment-485 Ervin Thu, 26 Mar 2009 06:08:59 +0000 http://www.financecreditaid.com/faqs/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/#comment-485 You can go for a unsecured debt consolidation loan where you can get a low interest rate compared to any banks and the added advantage would be, it will also improve your credit score as subsequent payments are made to pay off the new loan. Here is one of the source which I know of a debt consolidation company named for your reference. You can go for a unsecured debt consolidation loan where you can get a low interest rate compared to any banks and the added advantage would be, it will also improve your credit score as subsequent payments are made to pay off the new loan.

Here is one of the source which I know of a debt consolidation company named for your reference.

]]> Comment on Is there any option for debt consolidation if you are NOT in default with good credit but no equity? by Jeanne R http://www.financecreditaid.com/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/comment-page-1/#comment-484 Jeanne R Wed, 25 Mar 2009 11:53:33 +0000 http://www.financecreditaid.com/faqs/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/#comment-484 Since you are not in default you can call the credit card company and ask to have your interest rate lowered. If they won't lower it, you can open a new 0% interest rate card and transfer your balance. The 0% introductory rate usually last 6-12 months and you could pay off your credit card in that time period. If you have more than one high interest rate card, transfer as much as you can to the new 0% card from your highest interest rate cards. With luck you can transfer ALL of your high interest rate credit card debt to low or 0% cards. After you get your transfers done follow this system: Pay the minimum due on all of them and then put your extra money towards paying off the highest interest one first. After you get that one paid off, you put the money you were paying on card #1 (the minimum payment and the extra payment) towards card #2. That will pay card #2 off faster. When that is paid off, you put all three payments towards card #3 and that one will be paid off pretty quickly. As an example: To start : Card #1 (highest interest): minimum payment+ extra payment Card #2 (middle interest): minimum payment Card #3(lowest interest): minimum payment Card #1: paid off Card #2: minimum payment from Card #1+ Minimum payment from Card #2 +extra payment Card #3: minimum payment Card #1: paid off Card #2: paid off Card #3:Mimimum payment from card #1+ minimum payment from Card #2+ minimum payment from Card #3+ extra payment. That way, you will get them all paid off, on time, and pay the least interest. It will also help towards rebuilding your credit since you will no longer have any late payments. This works no matter how many different debts you may have. Since you are not in default you can call the credit card company and ask to have your interest rate lowered. If they won’t lower it, you can open a new 0% interest rate card and transfer your balance. The 0% introductory rate usually last 6-12 months and you could pay off your credit card in that time period. If you have more than one high interest rate card, transfer as much as you can to the new 0% card from your highest interest rate cards. With luck you can transfer ALL of your high interest rate credit card debt to low or 0% cards. After you get your transfers done follow this system:

Pay the minimum due on all of them and then put your extra money towards paying off the highest interest one first. After you get that one paid off, you put the money you were paying on card #1 (the minimum payment and the extra payment) towards card #2. That will pay card #2 off faster. When that is paid off, you put all three payments towards card #3 and that one will be paid off pretty quickly. As an example:

To start :
Card #1 (highest interest): minimum payment+ extra payment
Card #2 (middle interest): minimum payment
Card #3(lowest interest): minimum payment

Card #1: paid off
Card #2: minimum payment from Card #1+ Minimum payment from Card #2 +extra payment
Card #3: minimum payment

Card #1: paid off
Card #2: paid off
Card #3:Mimimum payment from card #1+ minimum payment from Card #2+ minimum payment from Card #3+ extra payment.

That way, you will get them all paid off, on time, and pay the least interest. It will also help towards rebuilding your credit since you will no longer have any late payments. This works no matter how many different debts you may have.

]]> Comment on Is there any option for debt consolidation if you are NOT in default with good credit but no equity? by Viv http://www.financecreditaid.com/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/comment-page-1/#comment-483 Viv Tue, 24 Mar 2009 22:12:11 +0000 http://www.financecreditaid.com/faqs/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/#comment-483 I work in insolvency so I come across this everyday! The only way to do it is if you keep transferring the balance onto other cards. If you have a lot of cards though it's very risky and a lot of hassle. It's generally better to just pay off as much as you can every month as you won't pay as much interest! You could always take out ONE low rate credit card for a few months to use for your living expenses and then use your income to pay back the other cards. It depends very much on what you owe on them but in my job id really advise that you pay thm off asap and never use them again unless for emergencies or you can afford to pay off the whole balance every month! I work in insolvency so I come across this everyday! The only way to do it is if you keep transferring the balance onto other cards. If you have a lot of cards though it’s very risky and a lot of hassle. It’s generally better to just pay off as much as you can every month as you won’t pay as much interest!
You could always take out ONE low rate credit card for a few months to use for your living expenses and then use your income to pay back the other cards. It depends very much on what you owe on them but in my job id really advise that you pay thm off asap and never use them again unless for emergencies or you can afford to pay off the whole balance every month!

]]> Comment on I recently graduated and have about 30K in debt, what is the best strategy for paying off the debt? by zeuz http://www.financecreditaid.com/i-recently-graduated-and-have-about-30k-in-debt-what-is-the-best-strategy-for-paying-off-the-debt/comment-page-1/#comment-560 zeuz Tue, 24 Mar 2009 14:07:38 +0000 http://www.financecreditaid.com/faqs/i-recently-graduated-and-have-about-30k-in-debt-what-is-the-best-strategy-for-paying-off-the-debt/#comment-560 Rarely is it smart to carry debt. Rarely is it smart to carry debt.

]]> Comment on Is there any option for debt consolidation if you are NOT in default with good credit but no equity? by bobby d http://www.financecreditaid.com/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/comment-page-1/#comment-482 bobby d Mon, 23 Mar 2009 00:35:22 +0000 http://www.financecreditaid.com/faqs/is-there-any-option-for-debt-consolidation-if-you-are-not-in-default-with-good-credit-but-no-equity/#comment-482 ask your credit card company to lower the rate, or transfer balances to lower rate cards ask your credit card company to lower the rate, or transfer balances to lower rate cards

]]> Comment on What happens if i don’t pay a debt for a toll violation? by jslinderml http://www.financecreditaid.com/what-happens-if-i-dont-pay-a-debt-for-a-toll-violation/comment-page-1/#comment-559 jslinderml Fri, 20 Mar 2009 21:14:31 +0000 http://www.financecreditaid.com/faqs/what-happens-if-i-dont-pay-a-debt-for-a-toll-violation/#comment-559 $145 seems REALLY excessive. First, you can tell them to stop calling at work, that's not allowed. Second, you can request a full accounting of the number and how it was reached. If that looks legitimate they are not required to negotiate. If it's iffy, offer to take them to small claims court and see how fast they change their tune. $145 seems REALLY excessive.

First, you can tell them to stop calling at work, that’s not allowed.

Second, you can request a full accounting of the number and how it was reached. If that looks legitimate they are not required to negotiate. If it’s iffy, offer to take them to small claims court and see how fast they change their tune.

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