Jump to content
Sign in to follow this  
Nrvsbride

Need advice...

Recommended Posts

I am thinking along the same lines as Janet ... I don't have a lot of great advice in this area, but everything she says makes sense to me!

Share this post


Link to post
Share on other sites

Super smart answer Janet - I totally agree with you! Especially the part about living below your means to get ahead. Sometimes you just can't have all the things that "look good" because it drags you down financially. It's amazing how many possibilities open up when you place limits on yourself (i.e. no more Starbucks = $4.50/day = $135/month = $1600+/year)

Share this post


Link to post
Share on other sites

Hi Glenda!

 

I actually answered this for a friend of mine a while back. I used to do corporate bankruptcy consulting, and I have heard this question over and over again. There is no one size fits all answer. But, if the situation is dire enough, debt consolidation isn't a horrible option.

 

Take a look at the attached article – it’s pretty basic, but it’s a good overview, especially with regard to when to look to debt consolidation and when not to.

 

The National Foundation for Credit Counseling is a good advocate, and they do a very, very good job of identifying good, reliable counseling agencies. You can do a quick search on Welcome to NFCC! of agencies based your zip code.

 

Another thing to note, the bankruptcy code was amended in 1996 to include certain provisions for consumer counseling. The attached article (which I’m guessing precedes that amendment) doesn’t address one of the key points which is that the Dept of Justice now has an “approved list” of consumer counseling agencies. You can find a link to the approved agencies here: U.S. Trustee Program/Dept. of Justice.

 

I don't like this list as much, because the criteria that they use to select their agencies is more of a tick box approach - if the agencies meet the stated requirements, they are approved. The NFCC is better. But, if you can find a counselor in your area that is on both lists, it's a good start.

 

Hope that helps!!

 

 

Article on Consumer Credit Counseling.pdf

Share this post


Link to post
Share on other sites

And I know he travels a lot, and spends lots of money when he does ... he really needs to stop that. I know it sucks, but he just needs to realize that he has to cut back on luxuries like that right now. Ya know? That sounds harsh, and you shouldn't need to tell him these things. Is he realizing the trouble he's in right now on his own?

Share this post


Link to post
Share on other sites

glenda, i have no great advice, as i'm currently pulling my sorry ass out of debt, while dh works his way into it....but i'll be keeping up with this thread to see if there's anything that can help us - short of dh declaring bankruptcy...

 

Quote:
Originally Posted by Christine View Post
Glenda, I feel you on this one, Will and I have been working really hard to get our debt down too.

As for the student loans you can apply to not pay them for a year or so if you are hitting hard times, don't remember exactly what its called. Also since the interest rate is really low right now can he consolidate his student loans to a lower interest rate and lower payments. Also has he gotten some of his loans knocked off for teaching? I get 5k knocked off in another year for teaching in a public school that is on the list, he should check to see if his is on the list.

I had a card that had an outrageous interest rate and got a bank loan for a much lower interest rate, a line of credit is what I got.

christine, where do you find this list?

Share this post


Link to post
Share on other sites

glenda, are his student loans federal or private? that makes a HUGE difference in terms of consolidating the student loan debts. federal is easier to defer or put on hold, while private are damn near impossible to avoid paying. if his loans are federal, and his payments exceed a certain percent of his monthly income, he can apply for forbearance and get the payments significantly reduced.

Share this post


Link to post
Share on other sites

id be really reallyyy careful with that because there are a lot of companys that will screw you up even worse. ive heard some horrible stories. my recomendation is call up your credit card company. ask them to drop the interest rate on it. sometimes they actually will do that. if you have been paying on time reently you can say that he has been doing better and tryign to straighten his credit out.

 

consider yourself lucky its only 10K hahaha wink.gif i got way more then that. BUT its the american way right. wink.gif

Share this post


Link to post
Share on other sites

Totally agree with what others have said...

 

From personal experience about reducing CC interest rates... after 6 months of ontime payments, they will reduce your rate. I had screwed up my credit in the past, late payments and such, and had a card that was at almost 30%! I've called every 6 months since, and each time they reduce the rate by 4-6%. Definitely give it a shot :)

Share this post


Link to post
Share on other sites

I'm not a big fan of those "consolidate your debt" companies. Most of them lure you into spending more money, sometimes.

If he continues to make payments on time, everything, he can call to ask to lower the interest rate (most credit card companies will do it, believe it or not).

Good luck!

Share this post


Link to post
Share on other sites

You can not declare bankruptcy on a student loan & they can garnish your wages to pay for it. So don't mess around with student loans.

 

I agree with Janet's advice. If you just solve the paying off the credit card problem, he can still accumulate more debt. If he is in a cycle of overspending the debt is not going away. And winning the lotto is not the solution. That usually just magnifies the problem. I think it takes getting serious about budgets & buckling down to get out of debt like this. But it can be done & people tend to feel great & empowered as they do it.

 

I really like the book "personal finance for dummies." I am sure there are some other good books geared towards paying off debt. It can be done though. The worst is to feel like there is so much debt you can escape. I have seen sucess stories of people in so much debt that follwed a plan & are now on their way to becoming millionaires.

 

This might be too much, but could you move out of new york city? Maybe somewhere with a lower cost of living can help you pay off all the debt.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

×