Credit Card Debt

• McFly1955

  

  Someone has told me about their situation and asked me about the best way to rid themselves of credit card debt....They are middle age, no equity in house, but have equity in their vehicles, about $25,000.
  
  Credit card debt around $100,000, they make all of the minimum payments and are paying an extra $500 or so on the lowest balance card, and plan to do a snowball reduction type of plan....The problem is, they are probably not going to get anywhere as 100K is spread over several cards, with varying interest rates from 15-30%.
  
  Advice?
  
  -debt settlement program? (high fees, don't know a lot about it myself)
  -bankruptcy? (always a very very last resort)
  -continue their own debt reduction plan?
  
  I told them I would call and reduce the rates ASAP.....
  
  I can't imagine being in that situation....I've never carried a CC balance, and while I do have student loans since my wife and I got out of college just a few years back, we are actively paying extra when we can, pay a little extra on our mortgage, and only have 1 car payment at a time, all while putting in the max to get our employer 401k match. I hate debt, and plan to be completely out of it by 30 years old (except for the house).
  
  I'd want to throw up if I were them.
• Trueblue23

  

  Wow and I thought I was bad for having a few hundred bucks on my credit card. I actually just paid my last balance off, feels great!
• Con_Alma

  unbelievable
  
  Is the debt due to medical or fixed living expenses incurred while a job loss was experienced?
• Society

  Is bankruptcy even an option on credit card debt now? I thought they passed a bill that doesn't allow this.
• McFly1955

  

  Con_Alma wrote: unbelievable
  
  Is the debt due to medical or fixed living expenses incurred while a job loss was experienced?

  I believe only a small portion, like a few thousand...The rest I assume was just reckless spending and not worrying about paying it back.
• Trueblue23

  

  I still have my two cc's, but I don't even keep them in my wallet anymore. They are locked up in my safe, only to be used on a rainy day.
• OneBuckeye

  

  Call one of those 1800 numbers I am sure they could help.
• Manhattan Buckeye

  They are never getting out of that without some sort of windfall. The best bet is to call the cards directly to see if they can get lower rates, I'm not sure how much success they can have.
• Belly35

  

  Call Acorn Operation they may be able to do something ............ like create a false ID and new social sercuity card
• Fab1b

  

  Awesome Belly
• j_crazy

  

  This person needs professional help.
• fan_from_texas

  Ouch. Unbelievable. The best bet is (1) stop spending and cut up the credit cards; (2) call the credit card companies, explain the situation, and seek to negotiate rates; and (3) if the companies won't negotiate, perhaps call a credit counselor.
  
  Alternatively, they could wipe the slate clean by selling off everything, significantly downsizing, and focus on paying off the debt.
  
  It's one thing to declare bankruptcy in a situation where there is unforseen job loss or medical emergencies. While that's bad, it's understandable. But profligate spending? It's morally reprehensible to declare bankruptcy in a situation like that unless you've sold off everything and still can't make the payments. And even then, it's awful.
• ZWICK 4 PREZ

  

  I'd focus on putting all my money towards lottery tickets. Better odds the more you buy.
• Belly35

  

  Fab1b wrote: Awesome Belly

  Thank you I will be here Monday thur Friday bring a friend next time
  Just trying to show the lighter sided of Belly
• Trueblue23

  

  fan_from_texas wrote: Ouch. Unbelievable. The best bet is (1) stop spending and cut up the credit cards; (2) call the credit card companies, explain the situation, and seek to negotiate rates; and (3) if the companies won't negotiate, perhaps call a credit counselor.
  
  Alternatively, they could wipe the slate clean by selling off everything, significantly downsizing, and focus on paying off the debt.
  
  It's one thing to declare bankruptcy in a situation where there is unforseen job loss or medical emergencies. While that's bad, it's understandable. But profligate spending? It's morally reprehensible to declare bankruptcy in a situation like that unless you've sold off everything and still can't make the payments. And even then, it's awful.

  I agree.
  
  When I was 18 years old, a friend of mine and I both decided to get a credit card, just to have in case of emergencies and to try to establish credit. I did a pretty good job of keeping up on mine, but that's still not to say I didn't buy retarded crap simply because I could. My buddy is a different story though.. he quickly maxed his card out, then got another card from Best Buy, which he used to buy and Xbox 360 and games and stuff. He never made one payment on anything, not one. He is 21 years old and about to file bankruptcy so he doesn't have to worry about them and he can let his car go back to the bank. What a winner.
• Websurfinbird

  

  McFly1955 wrote:

  Con_Alma wrote: unbelievable
  
  Is the debt due to medical or fixed living expenses incurred while a job loss was experienced?

  I believe only a small portion, like a few thousand...The rest I assume was just reckless spending and not worrying about paying it back.

  At first I felt kind of bad, but now after reading this I don't.
• FatHobbit

  

  You wanna play, you gotta pay...
  
  I would try to transfer it all to different cards with lower rates. I get offers all the time to transfer to a different card with a low interest rate until it's paid off or 0% for a fixed time. I'm not sure if that's an option when you're $100k in debt. Then just spend less than you make until it's paid off. Might not be a fun answer, but it will eventually work.
• power i

  

  ZWICK 4 PREZ wrote: I'd focus on putting all my money towards lottery tickets. Better odds the more you buy.

  Lol.
• Manhattan Buckeye

  "I'm not sure if that's an option when you're $100k in debt."
  
  Unless the credit card company accepting the transfer is ran by babboons, it isn't an option. That's why I think there may not be much success calling the current companies, they'll take a look at the credit report, possibly presume bankruptcy is the only option for the cardmember and try to squeeze as much out of the monthly minimums and what they may get out of bankruptcy.
• sleeper

  

  They need to talk to a credit counselor/debt relief agency. What they do essentially is charge you a monthly fee(which isn't terrible, like maybe $20 a month) and they work with your income to determine a rate a fixed monthly cost to start paying down the debt. Usually it's less than you would normally pay and it allows you to slowly start paying it off. They negotiate with the credit card companies to allow for this to happen. Essentially, the only catch is you can't use credit cards while you are paying them off, but that should be a no brainer.
• Trueblue23

  

  Could they just make a minimum payment for the rest of their lives? I know that isn't a good way to deal with it, but it sounds like they're really screwed.
• ZWICK 4 PREZ

  

  power i wrote:

  ZWICK 4 PREZ wrote: I'd focus on putting all my money towards lottery tickets. Better odds the more you buy.

  Lol.

  
  I can't believe I'm offering this advice for free on here.
• majorspark

  

  fan_from_texas wrote: Ouch. Unbelievable. The best bet is (1) stop spending and cut up the credit cards; (2) call the credit card companies, explain the situation, and seek to negotiate rates; and (3) if the companies won't negotiate, perhaps call a credit counselor.
  
  Alternatively, they could wipe the slate clean by selling off everything, significantly downsizing, and focus on paying off the debt.
  
  It's one thing to declare bankruptcy in a situation where there is unforseen job loss or medical emergencies. While that's bad, it's understandable. But profligate spending? It's morally reprehensible to declare bankruptcy in a situation like that unless you've sold off everything and still can't make the payments. And even then, it's awful.

  I agree with this as well. I would suggest once they sell everthing off, take some of the cash left and see if a few of these credit card companies will take an up front settlement for a fraction of the debt owed. Get this debt down to a manageable amount. Then focus on paying it off.
• Hammerin'Hank

  You say they have equity in the vehicles? How in the h*** can they have their vehicles paid off? Besides that, the equity in their vehicles is depreciating daily.
  Without completely stopping the use of their credit cards, they will never get out from under this......unless they file bankrupcy. We all then know who will be paying their way out. It will be us.
• cbus4life

  How the hell were they able to get up to 100k anyways?
  
  I mean, i know people with 10k debt, but at least that is completely manageable and can have yourself free of it in a few years if you really focus.
  
  But 100k? Who was giving them credit cards?