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Started By
Message
debt advice
Posted on 4/24/15 at 11:55 am
Posted on 4/24/15 at 11:55 am
OK so the wife and I went to get a Lona to consolidate all of our credit card, medical and other small debt we have. The bank came back with a counter offer the would pay off our cards but not everything.
They also want us to close 4 card accounts. 3 on my name pretty high limits and I have had them all for over 5 years.
The loan would save us a little bit each month instead of paying the cards individually.
Our predicament is should we take that and take the credit score hit that comes with closing those accounts? Or continue paying them like normal till we can get them paid out. We have the money monthly but can't throw huge chunks at them.
They also want us to close 4 card accounts. 3 on my name pretty high limits and I have had them all for over 5 years.
The loan would save us a little bit each month instead of paying the cards individually.
Our predicament is should we take that and take the credit score hit that comes with closing those accounts? Or continue paying them like normal till we can get them paid out. We have the money monthly but can't throw huge chunks at them.
3
Posted on 4/24/15 at 12:16 pm to TigerDat
Shop around for other offers.
Posted on 4/24/15 at 1:02 pm to AnonymousTiger
What's your DTI right now, and what's your Credit Utilization?
Posted on 4/24/15 at 1:11 pm to Coach Guidry
Is the new loan a home equity loan that will allow you to deduct the interest paid? Is the interest rate on the proposed new loan less than your credit card interest rates? How long is it going to take you to pay off those cards and small debts without the loan?
You need to not have so many open cards if you can't keep em in your wallet. Bank is right about that. Keeping me open to preserve a credit score is silly if you're not managing debt successfully.
You need to not have so many open cards if you can't keep em in your wallet. Bank is right about that. Keeping me open to preserve a credit score is silly if you're not managing debt successfully.
Posted on 4/24/15 at 3:17 pm to hungryone
Not home equity loan. The interest would be lower than the cards. The only reason I am in this spot is because of medical emergencies not careless spending.
I have had the three cards for years and thankfully I did when I needed them.
Not sure on the amount of time to pay the cards. The loan would be a 3 year loan.
I have had the three cards for years and thankfully I did when I needed them.
Not sure on the amount of time to pay the cards. The loan would be a 3 year loan.
Posted on 4/24/15 at 3:25 pm to TigerDat
So you're just trying to get an unsecured personal loan? If so, there are probably lots of options out there that will not require you to close the cards in order to get the loan.
If this is what you're looking for, check out this site for some helpful info.
If this is what you're looking for, check out this site for some helpful info.
This post was edited on 4/24/15 at 3:26 pm
Posted on 4/24/15 at 3:44 pm to AnonymousTiger
Yea just an unsecured loan. Thank
Posted on 4/24/15 at 3:46 pm to AnonymousTiger
If you take out a loan to pay off credit cards many lenders will want cards closed. There is nothing that prohibits you from charging the balances up again and then having double the revolving debt that you now have.
Posted on 4/24/15 at 4:12 pm to VABuckeye
quote:
If you take out a loan to pay off credit cards many lenders will want cards closed.
True, a lot of them will want you to do that. But before signing on that deal it wouldn't hurt to see if there may be some other lenders out there that would have more favorable terms and not make that request.
Posted on 4/24/15 at 7:15 pm to TigerDat
quote:
Our predicament is should we take that and take the credit score hit that comes with closing those accounts?
Closing an account is generally a small hit to your score, and it sounds like you shouldn't be borrowing more anytime soon anyway so who cares what happens to your score?
Definitely shop around for the best deal but don't worry about what happens to your credit score all that much until you get things under control.
Posted on 4/24/15 at 7:27 pm to TigerDat
You can not borrow yourself out of debt, take an aggressive approach and pay off your cards as quickly as possible, most people who consolidate card loans just end up charging them up again then having both debts
Posted on 4/24/15 at 7:38 pm to Tigerpaw123
quote:
You can not borrow yourself out of debt
You can if you get a lower rate.
Question for the OP - have you called your credit card issuers to ask for a lower rate? If you have a good payment history the chances are pretty reasonable that you'll get it.
There's another advantage to going that route instead - you can be very aggressive paying down revolving debt since if an emergency happens you can just charge it back up. You can't do that with a personal loan.
Posted on 4/25/15 at 9:02 am to foshizzle
I have talked to a few but the problem is I am current on all payments so they don't seem to want to work with us.
To those saying I haven't been good with my finances to get into debt. I wish it were so easy but sometimes life happens and you have to make s choice health or money.
We are not over our head in debt we are just trying to make it simpler. Instead of paying multiple payments to different companies at higher rates. Its easier and could be cheaper to pay one loan payment at a lower rate
To those saying I haven't been good with my finances to get into debt. I wish it were so easy but sometimes life happens and you have to make s choice health or money.
We are not over our head in debt we are just trying to make it simpler. Instead of paying multiple payments to different companies at higher rates. Its easier and could be cheaper to pay one loan payment at a lower rate
Posted on 4/25/15 at 9:18 am to TigerDat
Emergencies happen and you did what you had to do. Unfortunately a lender is going to see that available revolving credit as a ticking time bomb.
Posted on 4/25/15 at 11:00 am to VABuckeye
I definantly understand how the lender's see it just pointing out to some of those who seem to think that I just went charging up cards being irresponsible.
not evertyone who gets into debt did it irresponsibly is all I was saying. Thanks for all the input though
not evertyone who gets into debt did it irresponsibly is all I was saying. Thanks for all the input though
Posted on 4/25/15 at 1:36 pm to TigerDat
The only way to properly answer your question would be to know the size of the debts, your income, and expenses.
I understand that it is convienient to have a few credit cards to use in an emergency situation and you probably did what most of us would do if put in your shoes. But one big problem with having several (more than 2) credit cards open is it gives you the illusion that you actually have a proper emergency fund in place. Credit cards are not a replacement for an emergency fund as your example indicates. Once this mess is cleaned up you need to have a liquid fund in place that has nothing to do with available credit or borrowing potential.
I understand that it is convienient to have a few credit cards to use in an emergency situation and you probably did what most of us would do if put in your shoes. But one big problem with having several (more than 2) credit cards open is it gives you the illusion that you actually have a proper emergency fund in place. Credit cards are not a replacement for an emergency fund as your example indicates. Once this mess is cleaned up you need to have a liquid fund in place that has nothing to do with available credit or borrowing potential.
Posted on 4/25/15 at 2:25 pm to xrockfordf150x
quote:
I understand that it is convienient to have a few credit cards to use in an emergency situation and you probably did what most of us would do if put in your shoes. But one big problem with having several (more than 2) credit cards open is it gives you the illusion that you actually have a proper emergency fund in place. Credit cards are not a replacement for an emergency fund as your example indicates. Once this mess is cleaned up you need to have a liquid fund in place that has nothing to do with available credit or borrowing potential.
You are correct it isn't the right way to do it but unfortunantly the couple grand I had saved for emergencies was exhausted. Hopefully I can be out of this as soon as possible and get that cushion back.
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