Drowning in debt
October 18, 2006 1:49 PM Subscribe
I've got around $8000 in credit card debts, my minimum payments are costing me as much as my rent, and the interest rates are so high that I'm not gaining any ground. Help!
Obviously just paying the damn things off would be the simplest fix, but my income's pretty low (and it's the first job I've had in years that didn't put me in a crippling depression, so I'm not switching), and my life expenses are cut down to the minimum, and I'm still missing phone bill payments.
Mostly I'm looking for recommendations of debt consolidation agencies; I could just google, but I don't want to just go with whoever's paid the most on SEO work and web design, I want someone I know won't screw me over. Also I should mention that my credit's pretty poor and I have absolutely no sort of collateral. Whee!
Obviously just paying the damn things off would be the simplest fix, but my income's pretty low (and it's the first job I've had in years that didn't put me in a crippling depression, so I'm not switching), and my life expenses are cut down to the minimum, and I'm still missing phone bill payments.
Mostly I'm looking for recommendations of debt consolidation agencies; I could just google, but I don't want to just go with whoever's paid the most on SEO work and web design, I want someone I know won't screw me over. Also I should mention that my credit's pretty poor and I have absolutely no sort of collateral. Whee!
Reading some of these will help. Take the time to read.
http://www.google.com/search?q=%22debt+consolidation%22+%2Bfraud+%2Bscam&start=0
posted by hank at 2:03 PM on October 18, 2006
http://www.google.com/search?q=%22debt+consolidation%22+%2Bfraud+%2Bscam&start=0
posted by hank at 2:03 PM on October 18, 2006
Nobody with a steady job should have to pay credit card interest rates. (I am neither a lawyer nor a financial advisor.) I would avoid debt consolidation agencies and those fake non-profit "debt relief" outfits for now: They're middlemen/brokers who specialize in hopeless cases. If you've got a solid job, walk into your bank and talk to a loan advisor. There's no charge to find out what they can do for you -- and there's no incentive to bamboozle or upcharge you.
Or, if you think you can handle it, transfer that load to a new credit card with a promotional 0% rate for transfers, and set up your own payment plan. Be aware, though, that missing even a single payment will jack your rates sky-high -- leaving you in an even worse position. Good luck!
posted by turducken at 2:06 PM on October 18, 2006 [1 favorite]
Or, if you think you can handle it, transfer that load to a new credit card with a promotional 0% rate for transfers, and set up your own payment plan. Be aware, though, that missing even a single payment will jack your rates sky-high -- leaving you in an even worse position. Good luck!
posted by turducken at 2:06 PM on October 18, 2006 [1 favorite]
Surprised nobody has yet mentioned The Richest Man in Babylon.
Get it. Read it. Do it. It's not easy but it is simple and anyone can do it, if they are willing.
posted by trinity8-director at 2:16 PM on October 18, 2006
Get it. Read it. Do it. It's not easy but it is simple and anyone can do it, if they are willing.
posted by trinity8-director at 2:16 PM on October 18, 2006
I agree with turducken -- try your bank. If the bank won't help you, try the nearest credit union, and keep on trying until you find one willing to give you a loan.
If you have no luck there, try paying off the card with the smallest amount first. Send the minimum payment to all your other cards, and then every remaining cent toward the smallest card. Once that card is paid off, do the same with the second smallest card, etc. People always say to pay off the card with the highest interest rate first, but this "snowball" technique worked for me after years of struggling with the usual high-interest-cards-first way.
posted by vorfeed at 2:23 PM on October 18, 2006 [1 favorite]
If you have no luck there, try paying off the card with the smallest amount first. Send the minimum payment to all your other cards, and then every remaining cent toward the smallest card. Once that card is paid off, do the same with the second smallest card, etc. People always say to pay off the card with the highest interest rate first, but this "snowball" technique worked for me after years of struggling with the usual high-interest-cards-first way.
posted by vorfeed at 2:23 PM on October 18, 2006 [1 favorite]
First, stop any form of service billing to your credit card, if you are doing an autopay system. Your cell phone provider can send you a bill and you can pay in cash.
Then, stop using the card, completely. In case of emergency, find some other way to make it work. Get food from a food bank, borrow from friends, whatever. Just don't charge anything more.
Next, make sure you pay at least the minimum payment. You will then, at the very least, make some headway on getting your debt paid off.
Finally, go to your bank and ask for a loan to pay off your credit card debt. If you have a job, you are very likely to get a personal loan at a much lower interest rate. I did this four years ago, on $6500 in credit card debt.
posted by solid-one-love at 2:26 PM on October 18, 2006
Then, stop using the card, completely. In case of emergency, find some other way to make it work. Get food from a food bank, borrow from friends, whatever. Just don't charge anything more.
Next, make sure you pay at least the minimum payment. You will then, at the very least, make some headway on getting your debt paid off.
Finally, go to your bank and ask for a loan to pay off your credit card debt. If you have a job, you are very likely to get a personal loan at a much lower interest rate. I did this four years ago, on $6500 in credit card debt.
posted by solid-one-love at 2:26 PM on October 18, 2006
You should know that debt consolidation is not always the best answer...some of the "agencies" are less-than-timely in their payment of the debts in question. It will also damage your credit badly to do so.
$8000 in credit card debt isn't terrifically bad, as national averages go. :-) Have you considered/is it possible to take an extra job just to pay towards the debt? You can make $1000 a month delivering pizzas at night, and just be done with this in less than a year.
posted by griffey at 2:30 PM on October 18, 2006
$8000 in credit card debt isn't terrifically bad, as national averages go. :-) Have you considered/is it possible to take an extra job just to pay towards the debt? You can make $1000 a month delivering pizzas at night, and just be done with this in less than a year.
posted by griffey at 2:30 PM on October 18, 2006
I don't really like being characterized as a "hopeless case" because I'm using a debt consolidation agency - we'll be out of debt in 4 years, our payments are managable, and now we're able to save money every month AND enjoy a few of the finer things in life. I can't recommend a debt consolidation agency enough.
For safety, contact your credit card company and ask for their recs - that's how we found ours, it was one the company uses frequently so we know there was no swindle. But then again our cards are through our bank so it was all technically through the bank.
posted by agregoli at 2:32 PM on October 18, 2006
For safety, contact your credit card company and ask for their recs - that's how we found ours, it was one the company uses frequently so we know there was no swindle. But then again our cards are through our bank so it was all technically through the bank.
posted by agregoli at 2:32 PM on October 18, 2006
If you do decide to go with a credit consolidation agency, try checking with the Attorney General for your state and/or the Better Business Bureau in your area. They may be able to provide information (not specific details?) as to whether or not someone has filed complaints about a company in your area.
Also, once you're enrolled in the program, check with your creditors on occasion to make sure the consolidation company is passing your payments on and your balances are being reduced. An old friend of mine signed up with a consolidation agency a few years ago. They set up an agreement where they would take $450-ish from her checking account per month by EFT and then pay her credit cards, phone etc. It worked for a few months - then she started getting bills from the creditors again and the balances hadn't changed as she thought they should have. The debt company was still taking the money from her account, but wasn't paying any of her bills.
posted by youngergirl44 at 2:32 PM on October 18, 2006
Also, once you're enrolled in the program, check with your creditors on occasion to make sure the consolidation company is passing your payments on and your balances are being reduced. An old friend of mine signed up with a consolidation agency a few years ago. They set up an agreement where they would take $450-ish from her checking account per month by EFT and then pay her credit cards, phone etc. It worked for a few months - then she started getting bills from the creditors again and the balances hadn't changed as she thought they should have. The debt company was still taking the money from her account, but wasn't paying any of her bills.
posted by youngergirl44 at 2:32 PM on October 18, 2006
Stop using your credit cards. Seriously. This one step alone will help you more than any other. I recommend destroying them and learning to do without. It's the best thing you can do to help turn your situation around. I don't have time to provide a more elaborate response; you're sure to get plenty of advice from others. You may want to check out these various bits about coping with credit card debt.
posted by jdroth at 2:34 PM on October 18, 2006
posted by jdroth at 2:34 PM on October 18, 2006
Hm... well clearly the priority is to reduce your monthly payment. One way to do that is to bounce your balance(s) to a lower-rate card -- everyone's saying 0%, but any rate that brings your per-card minimum payment under $100 would be helpful. I don't know if you've looked into this, but it seems hard to imagine that you couldn't do this at least in part -- they're giving credit cards to dogs & cats these days.
In fact, you're going to have to do this eventually; if your rates are so high that you're not making any progress paying "your rent" against 8 grand every month, then I imagine you've missed some payments and your card issuers are not going to be reducing those rates any time soon on those particular balances. So moving the balances to new cards will be an essential part of basically any other strategy. Get on it.
One alternative, I guess, is to get a loan from a friend or family member for the full amount and get a favorable, realistic interest rate and payment schedule for them. You could even hack up a contract for this loan if that's a concern. Of course you have no collateral, but... it's family.
Another option is to do more work. I know you're not open to switching jobs, but what about taking on another job? You could do waiting or bartending, but I would seriously look into temping. You could probably make something north of $15 an hour if you're college educated and have some sort of computer skills, and there are temp jobs that only require working on weekends and/or nights. Now, it'll suck, but it'll be episodic and it will help you pay down your debts pretty quickly -- you'd be making an extra several hundred to a grand every month, and if your living expenses stay low, you could put it all towards your credit cards. Of course, this will be MUCH more effective if you can bounce the balances to a low-rate card or cards, so again, get on that.
I know it sounds crappy, but... you have tons of debt, it's clearly stressing you out, and if you combine it with consolidating the balances to a lower-rate card, you could probably pay off enough to de-stress yourself within a couple months. Then, since it's temp work and you have no obligation, you can reassess whether it's worth continuing or whether your new payments are realistic to back off.
posted by rkent at 2:37 PM on October 18, 2006
In fact, you're going to have to do this eventually; if your rates are so high that you're not making any progress paying "your rent" against 8 grand every month, then I imagine you've missed some payments and your card issuers are not going to be reducing those rates any time soon on those particular balances. So moving the balances to new cards will be an essential part of basically any other strategy. Get on it.
One alternative, I guess, is to get a loan from a friend or family member for the full amount and get a favorable, realistic interest rate and payment schedule for them. You could even hack up a contract for this loan if that's a concern. Of course you have no collateral, but... it's family.
Another option is to do more work. I know you're not open to switching jobs, but what about taking on another job? You could do waiting or bartending, but I would seriously look into temping. You could probably make something north of $15 an hour if you're college educated and have some sort of computer skills, and there are temp jobs that only require working on weekends and/or nights. Now, it'll suck, but it'll be episodic and it will help you pay down your debts pretty quickly -- you'd be making an extra several hundred to a grand every month, and if your living expenses stay low, you could put it all towards your credit cards. Of course, this will be MUCH more effective if you can bounce the balances to a low-rate card or cards, so again, get on that.
I know it sounds crappy, but... you have tons of debt, it's clearly stressing you out, and if you combine it with consolidating the balances to a lower-rate card, you could probably pay off enough to de-stress yourself within a couple months. Then, since it's temp work and you have no obligation, you can reassess whether it's worth continuing or whether your new payments are realistic to back off.
posted by rkent at 2:37 PM on October 18, 2006
Squid, you so close to toast. I have a friend who tried going the debt-consolidation route, and as soon as some of the CCs heard she was going for debt consolidation, they put her in the 'high-risk' category and jacked her interest rate to 30%, making it harder, overall, to pay down the whole mess. I guess their theory is that by jacking their rate higher than the rest, they get paid off first, before she goes totally under. Partially offsetting this was the negotiation her debt reconsolidator had with some of the CCs, getting them to agree to a lower interest rate and more gradual payment. If you can possibly swing just paying the damned things off, that's probably your best option.
Though it sucks, finding a better-paying job is probably necessary. First step, of course, is cutting the cards to shreds and getting a debit card instead. Next is using direct-deposit to put all your monthly fixed costs into one account, that has auto-bill-pay set up so you never touch or even think about it. The rest of your income goes into your debit card account and is used for non-fixed expenses. When it runs dry, that's it until next payday. Just doing that will eventually get you out, but it sounds as though you may end up sharing a dump with someone for the cheap rent or something.
posted by gregor-e at 2:39 PM on October 18, 2006
Though it sucks, finding a better-paying job is probably necessary. First step, of course, is cutting the cards to shreds and getting a debit card instead. Next is using direct-deposit to put all your monthly fixed costs into one account, that has auto-bill-pay set up so you never touch or even think about it. The rest of your income goes into your debit card account and is used for non-fixed expenses. When it runs dry, that's it until next payday. Just doing that will eventually get you out, but it sounds as though you may end up sharing a dump with someone for the cheap rent or something.
posted by gregor-e at 2:39 PM on October 18, 2006
Response by poster: A lot of this is good advice, but advice that I already know and which doesn't apply to my case. To clarify, I have long since stopped using the cards for anything, I am paying the minimums and am currently unable to pay any more, and every month, after the financial charges kick in, I'm back over the credit limit of both cards just from interest.
posted by squidlarkin at 2:41 PM on October 18, 2006
posted by squidlarkin at 2:41 PM on October 18, 2006
Best answer: I've never used a debt consolidation agency. But in my experience, calling the credit card companies directly and asking them to work with you is pretty effective. If you say "Listen, I want to pay, but I owe a lot and I just can't afford to give you more than $10 per month," then they may try and haggle with you, but ultimately they will prefer the phone call to end in an agreement that you'll keep paying than an indication that maybe you won't. Come up with a plan and propose it to them.
posted by bingo at 2:46 PM on October 18, 2006 [1 favorite]
posted by bingo at 2:46 PM on October 18, 2006 [1 favorite]
squidlarkin: Just read your last comment. Okay, sounds like you're actually right where the card companies want you.
posted by bingo at 2:51 PM on October 18, 2006
posted by bingo at 2:51 PM on October 18, 2006
What everyone else said, and just decide to be unashamedly and unfashionably cheap. Bringing your lunch to work every single day cheap. (The funny looks, questions, stop after a few weeks.) It's hard if your friends make more money than you, were born rich, or just don't care about their debt yet. Many people get to $20k before they have your realization, so depending on your income you're not in such bad shape. If you refuse to take on any more dept, not just including but ESPECIALLY over the holidays, pay your minimums or more if you can, and enjoy the simple and free pleasures of life, you should be fine. Good luck!
posted by Doctor Barnett at 2:56 PM on October 18, 2006
posted by Doctor Barnett at 2:56 PM on October 18, 2006
Well, since you're asking for recommendations for a debt consolidation agency, I paid off $6000 in credit card debt through Genus Credit Management. Caveat: this was about 5 or 6 years ago, so they might have changed in many, possibly bad, ways since.
My interest rates were extremely high, and after I went into their program a couple of the cards lowered their rates to 0% and the third went to a low rate, but I don't remember what it was. I paid something like $25 per month as a fee, and it was a bargain compared to the interest I had been paying. They always paid my bills on time.
I didn't notice any damage to my credit after signing up, which was already not great because of my prior late payments. But I haven't tried to buy a house or car or anything like that.
As to other suggestions made, I also got a second job, and I didn't try making a deal with the companies directly, which I've heard can work.
posted by Mavri at 3:06 PM on October 18, 2006
My interest rates were extremely high, and after I went into their program a couple of the cards lowered their rates to 0% and the third went to a low rate, but I don't remember what it was. I paid something like $25 per month as a fee, and it was a bargain compared to the interest I had been paying. They always paid my bills on time.
I didn't notice any damage to my credit after signing up, which was already not great because of my prior late payments. But I haven't tried to buy a house or car or anything like that.
As to other suggestions made, I also got a second job, and I didn't try making a deal with the companies directly, which I've heard can work.
posted by Mavri at 3:06 PM on October 18, 2006
I'm glad to hear that you've stopped acquiring more debt.
One option that you might consider is to get more money. If you've already trimmed expenses as low as they'll go, your best option is to increase income. You can do this be taking a second job, even a shitty part-time job. Do this for a couple months, throw the income at a debt, and all of a sudden you've taken a chunk out of one debt enough that your regular income covers more than minimums. Next, attack your debts with the Debt Snowball.
Or, find something that you can sell. (Or many things.) Flog them on eBay. Hold a yard sale. Get a lump sum of cash, and apply it all to debt. Again, once you've taken a chunk out of one debt enough that your regular income covers more than minimums, you can apply the Debt Snowball.
It's going to take hard work. When you go into debt, you're essentially spending future labor. You're saying "okay, I'm willing to sacrifice labor in the future to get the rewards now". And now you've got to pay. It sucks -- I know, I've been there -- but the best thing to do is just put your heart and soul into it for a month, or three, or twelve. You can do it.
posted by jdroth at 3:13 PM on October 18, 2006
One option that you might consider is to get more money. If you've already trimmed expenses as low as they'll go, your best option is to increase income. You can do this be taking a second job, even a shitty part-time job. Do this for a couple months, throw the income at a debt, and all of a sudden you've taken a chunk out of one debt enough that your regular income covers more than minimums. Next, attack your debts with the Debt Snowball.
Or, find something that you can sell. (Or many things.) Flog them on eBay. Hold a yard sale. Get a lump sum of cash, and apply it all to debt. Again, once you've taken a chunk out of one debt enough that your regular income covers more than minimums, you can apply the Debt Snowball.
It's going to take hard work. When you go into debt, you're essentially spending future labor. You're saying "okay, I'm willing to sacrifice labor in the future to get the rewards now". And now you've got to pay. It sucks -- I know, I've been there -- but the best thing to do is just put your heart and soul into it for a month, or three, or twelve. You can do it.
posted by jdroth at 3:13 PM on October 18, 2006
After my post I did a quick Google for Genus and there are complaints. Maybe I was just lucky.
posted by Mavri at 3:37 PM on October 18, 2006
posted by Mavri at 3:37 PM on October 18, 2006
Quality of experience may vary, but my husband has been with MMI debt management credit counseling (originally Ameridebt, passed on to MMI when Ameridebt tanked) and they did what they said and have not screwed us and everything gets paid. For a long time they were a pain to use, we had to go to the store and Western Union the monthly payment, but I think you might actually be able to do it online now.
His credit has steadily improved over the 4 years he's been with them, and our mortgage broker is satisfied with what he's seen and there don't appear to be any big black marks for using credit counseling. The only thing left to do on several accounts is close them, which MMI does not do, and the credit card companies are being incredibly foot-draggy about complying. I don't think that has anything to do with using debt management, though.
I have old fashioned shitty credit because I was too proud to get help when I got laid off five years ago. Don't do that. Whatever else you do, don't just drown, in the end it doesn't do you any good.
posted by Lyn Never at 3:49 PM on October 18, 2006
His credit has steadily improved over the 4 years he's been with them, and our mortgage broker is satisfied with what he's seen and there don't appear to be any big black marks for using credit counseling. The only thing left to do on several accounts is close them, which MMI does not do, and the credit card companies are being incredibly foot-draggy about complying. I don't think that has anything to do with using debt management, though.
I have old fashioned shitty credit because I was too proud to get help when I got laid off five years ago. Don't do that. Whatever else you do, don't just drown, in the end it doesn't do you any good.
posted by Lyn Never at 3:49 PM on October 18, 2006
Best answer: Have you tried calling the credit cards and asking for lower interest rates? Tell them you got an offer from someone else that has much lower charges and interest, and you're thinking of switching. Often it works, especially if you're firm.
posted by croutonsupafreak at 3:53 PM on October 18, 2006
posted by croutonsupafreak at 3:53 PM on October 18, 2006
jdroth is right; it's time to get a second job. Your profile mentions that you work in an office, which suggests that you probably work 40 hour weeks. You could work an additional 40 hours each week and still get 8 hours of sleep. Obviously you would have no social life. But it seems to me that you probably can't afford one right now anyway, so why not dedicate yourself for the next 12-24 months and make sure that your debt is paid off?
If you worked 40 hours/week extra @ $7/hour, after taxes, you'd take home ~$800/month in extra income. You'd have the debt paid off in a year if you did that. Obviously that's best case scenario (and often not possible) but you got yourself into this mess. Now it's time to man up and get out. Crying to debt collection agencies only delays the real problem: you don't make enough money. So you need to fix that underlying issue before you do anything else. What better way than to get another job?
posted by SeizeTheDay at 4:20 PM on October 18, 2006
If you worked 40 hours/week extra @ $7/hour, after taxes, you'd take home ~$800/month in extra income. You'd have the debt paid off in a year if you did that. Obviously that's best case scenario (and often not possible) but you got yourself into this mess. Now it's time to man up and get out. Crying to debt collection agencies only delays the real problem: you don't make enough money. So you need to fix that underlying issue before you do anything else. What better way than to get another job?
posted by SeizeTheDay at 4:20 PM on October 18, 2006
Response by poster: Holy crap, I called Discover and explained my situation, and they practically fell over themselves reversing charges and dropped my APR by 10 points. Having a steady income counts for something, it seems.
posted by squidlarkin at 4:55 PM on October 18, 2006
posted by squidlarkin at 4:55 PM on October 18, 2006
Nice one, squid! I was just going to suggest the same route, as I happened to call my cc company today asking politely for a lower rate. They promptly knocked two points off. Now, if you have cable TV/internet, do the same. Call them up, tell them you're considering getting rid of their service and see what they offer you. I've heard of people getting some good promotional rates that way.
posted by schoolgirl report at 5:03 PM on October 18, 2006 [1 favorite]
posted by schoolgirl report at 5:03 PM on October 18, 2006 [1 favorite]
Oh yes, Schoolgirl Report is right, I went to cancel my home phone, and they ended up offering me a $35.00 per month discount on line rental, two months free internet and free calls.
I was in the happy position that I really didn't want the phone, which is a great bargaining position to be in.
posted by tomble at 5:34 PM on October 18, 2006
I was in the happy position that I really didn't want the phone, which is a great bargaining position to be in.
posted by tomble at 5:34 PM on October 18, 2006
If your minimum payments are as big as your rent, I bet you have that debt spread across a lot of account. If you can get it consolidated onto one or two credit cards at a low APR, your monthly payment will plummet. I have a Chase card at 0% and their minimum payment is a mere 2%, which on $8000 would be just $160 a month.
posted by kindall at 7:25 PM on October 18, 2006
posted by kindall at 7:25 PM on October 18, 2006
I would avoid debt consolidation agencies and those fake non-profit "debt relief" outfits for now: They're middlemen/brokers who specialize in hopeless cases.
The "call credit cards directly" answers are marked as best answers, but in my experience, the credit card companies will NOT EVER work with individual customers. I've used Consumer Credit Counseling Service (CCCS) at the recommendation of one of my creditors when making one of those calls.
CCCS and other non-profit credit counseling agencies have standing agreements with many creditors to lower or eliminate interest. You pay the agency and they charge a fee for each credit card company they are paying. The money I saved in lower interest rates more than offset the fee the agency charged.
While going through the program, it is difficult to get additional credit; we could not qualify for a home loan, but we were able to finance a used car at a reasonable rate.
But as soon as it's paid off, your credit rating jumps. My credit is now in the second-to-the-top bracket, good enough to get the best interest rates most of the time.
posted by Doohickie at 8:13 PM on October 18, 2006
The "call credit cards directly" answers are marked as best answers, but in my experience, the credit card companies will NOT EVER work with individual customers. I've used Consumer Credit Counseling Service (CCCS) at the recommendation of one of my creditors when making one of those calls.
CCCS and other non-profit credit counseling agencies have standing agreements with many creditors to lower or eliminate interest. You pay the agency and they charge a fee for each credit card company they are paying. The money I saved in lower interest rates more than offset the fee the agency charged.
While going through the program, it is difficult to get additional credit; we could not qualify for a home loan, but we were able to finance a used car at a reasonable rate.
But as soon as it's paid off, your credit rating jumps. My credit is now in the second-to-the-top bracket, good enough to get the best interest rates most of the time.
posted by Doohickie at 8:13 PM on October 18, 2006
The "call credit cards directly" answers are marked as best answers, but in my experience, the credit card companies will NOT EVER work with individual customers.
Insist on speaking to a supervisor or manager. The low rung people can't do shit. They may tell you that they can't pass you to a supervisor but will try to help you. INSIST to speak to a supervisor (but remain polite).
posted by dobbs at 8:18 PM on October 18, 2006 [1 favorite]
Insist on speaking to a supervisor or manager. The low rung people can't do shit. They may tell you that they can't pass you to a supervisor but will try to help you. INSIST to speak to a supervisor (but remain polite).
posted by dobbs at 8:18 PM on October 18, 2006 [1 favorite]
Family or friends may be able to loan you the money through a structured loan system. A specific company lke CircleLending will handle documents, loan payments, etc, plus you get to pay your family member 4,5,6 percent instead of the 12,13,14+ you are paying to the credit card companies.
It's a win-win for everyone, except the credit card companies.
posted by omidius at 7:04 AM on October 19, 2006
It's a win-win for everyone, except the credit card companies.
posted by omidius at 7:04 AM on October 19, 2006
Another benefit of doing the CCCS thing as opposed to self-regulating: Chances are, you got to your current uncomfortable level of debt because you're not that great at self-regulating. What makes you think you can self-regulate your way out? (Note that I mean the general you, not *you* specifically.) CCCS and other similar agencies have pretty strict rules intended to make you pay off your debt so you can move on.
And maybe someone who's a real good talker can get some credit cards to adjust their terms to people who are over-extended, but that is the exception, not the rule. The whole reason the creditors like CCCS and like agencies is that they *are* strict. They know this. That is what they get out of the deal in exchange for lowering their rates- knowing that it isn't just the credit customer that is doing the paying down, that there is an authority figure involved (saves the creditor money if they don't have to send you to collections).
posted by Doohickie at 9:27 AM on October 19, 2006
And maybe someone who's a real good talker can get some credit cards to adjust their terms to people who are over-extended, but that is the exception, not the rule. The whole reason the creditors like CCCS and like agencies is that they *are* strict. They know this. That is what they get out of the deal in exchange for lowering their rates- knowing that it isn't just the credit customer that is doing the paying down, that there is an authority figure involved (saves the creditor money if they don't have to send you to collections).
posted by Doohickie at 9:27 AM on October 19, 2006
This thread is closed to new comments.
posted by jerseygirl at 1:53 PM on October 18, 2006