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Credit Card Debt - What to do?

June 18th, 2011 at 04:46 pm

I have about 3 credit cards which are all current at the moment. The 2 have small monthly payments and the 3rd has a monthly payment of over $250 a month.

Lately I've been feeling like I'm still stuck in the beginning. I try to pay more than what is due but each month when the bill comes, the monthly payments are still the same. I've been thinking about not paying this card anymore. I am fully aware of the consequences (phone calls, late fees, collections, etc). I've been thinking more and more about letting it go to collections. I feel that if I stop the payments, I can start saving and when that day comes, I can make settlement.

I've been talking to friends to get their story. One friend defaulted on 4 cards which she settled later. She said she never paid taxes and once she paid her credit went back up. I'm at a lost as to what really happens in the process. If I continue paying, then I will be digging us deeper in the hole.

Can anyone give me insight into your story?

8 Responses to “Credit Card Debt - What to do?”

  1. Looking Forward Says:

    Have you called the cc and told them you will have to stop paying because of hardship? I have heard that sometimes you can negotiate with a supervisor for a lower or 0% interest rate for a period of time. Or they might lower the required minimum payment. I think in the long run you'd be better served by paying these cc rather than letting them go to collections. Only you can decide what is best for you. Good luck either way. Smile

  2. ktmarvels Says:

    I would second the advice to call the CC companies...even the ones with low monthly payments. You might be able to lower the interest rates on them which would ultimately save you money in the long run.

    Also have you tried plugging your numbers into an online calculator? While it may seem daunting to see how long it will take you to pay it off in its entirety, it may be motivating to see how adding additional payments can shorten that time.

  3. Ima saver Says:

    I think you should continue with the payments. It is the moral thing to do.

  4. LuckyRobin Says:

    Pay your cards. You have the income to do so, then you should do it, even if it only feels like you are barely keeping your head above water. However, pay the minimums on two of the cards and put all extra toward the third card (you can choose the highest interest rate or the one with the lowest balance that would get paid off soonest, whichever works for you better as an incentive). If you are paying only a little extra on each card it will not look like you are making any progress. But if you put all the extra on that one card you will start seeing your balance drop. Also stop using the credit cards. If you continue to use them but make the same payments, your balance will never really go down. I know it can be exhausting, but you will feel much better about yourself if you meet your obligations than you will feel if you default on them.

  5. gigglestar Says:

    Thanks for all the advice, I really do appreciate it...i haven't used the cards in over 2 yrs. The small ones i already negotiated so i don't think i can lower it any further. The bigger one, the company only allows me to be on a special plan temporarily. It helps for the time being but once it's over i'm back to what it was before. So you can see my frustration. I'm going to see what else i can do. Thanks all!

  6. J-Money Says:

    I would pay them if you can - they don't have to accept your settlement offer and can sue you later. That is a another mess you don't want to deal with. Legal fees, lost time and frustration plus more fees for the penalities and interest, etc. You will lose the judgement and be required to pay anyway and they may even be able to garnish your wages depending upon the state you are in. just pay it and then burn it, never to use it again.

  7. gigglestar Says:

    Thanks for the advice....i'm going to make payment today and see if they can reduce it next month.

  8. Jerry Says:

    I also urge you to make the payments and keep in communication, or it will lead to a worse situation. Saving money by defaulting on a loan is not going to offer you any insurance of a better financial future, and you can find people all over these blogs who have paid off their debts while making short money. Don't give up, you can do it!
    Jerry

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