heres my situation, im 21, make about 00 a mth, and my bills take up 70% of that money, i have a credit card that has a limit of 00, but the balence is 40 (they charge me 0 in fees a mth, so i cant seem to keep it under much), i have a loan, that i have not payed in over 180days, that is 00 (i always seem to be to low on money to spare any to pay to them), i also had to have my car repoed about a year ago, becase i lost my good paying job, i owed 17k for my car, and they only got 10k for it when they sold it, so im debt for a total of around -12k
i dont know what to do, i cant seem to figure out how to fix this, the only thing i can think of is NEVER buy anything for myself that i dont need, and just pay back them as much as i can each mth untill its gone (would prob take 2-3yrs of suffering)
HELP!?!?!?!?!?
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Tue, Sep 7, 2010
September 7th, 2010 at 9:48 am
First off, pay something, anything towards your loan (to prevent it from going to a collection agency) and your credit card. Ideally, get your credit card below your limit.
Secondly, focus on your credit card by paying as much as you can towards it each month, while still making the minimum payment on your loan. But make sure to set aside enough money for the little things like laundry or a night out. There’s no sense burning yourself out, you have to live a little too.
As for your repo, if you can make payment arrangements…great. Your repo is already a negative marking on your credit report. So I would focus on the above two.
It’ll take TIME, PATIENCE and most of all DISCIPLINE! If you feel the need or can spare the time, pick up a part-time job.
If you start thinking bankruptcy try a reputable credit counselors/debt consolidation first (go to the Better Business Bureau to find one near you).
BANKRUPTCY SHOULD BE YOUR ABSOLUTE LAST RESORT!!!
Good Luck.
September 7th, 2010 at 9:48 am
I’ve used Consumer Credit Counseling Service before. They get the credit companies to stop the fees and penalties, and work with you to set up a budget while getting your payment within your means.
September 7th, 2010 at 9:48 am
Creditors ultimately just want their money. Contact each one, briefly explain your situation, and set up a payment plan with them that you can afford. Sit down and work the numbers yourself, that way you’re not caught off guard during the conversations only to realize later that you over committed yourself.
I was in a similar situation when I was your age and now I’m a home owner with almost no debt.
Good luck!
September 7th, 2010 at 9:48 am
THERE ARE COMPANIES THAT WILL TAKE OVER YOUR DEBT AND YOU PAY THEM SO MUCH FROM WHAT YOU EARN-WORK IT OUT WITH THEM -IT MAY COST YOU A BIT MORE EVERYONE MAKES MONIES LIKE THEM BUT TALK IT OVER OTHERWISE IT WILL MAKE YOU ILL WITH WORRY-THEY PUT ALL YOUR DEBTS TOGETHER-LET THEM DO THE REST
September 7th, 2010 at 9:48 am
I can empathize with you; I have been there. It took a lot of education and a good amount of scrimping to get me out. So here’s what I learned and did:
First, call your creditors and let them help you work out a plan with them that they will accept and that you can do. It only makes your situation worse if you wait until they’re calling you.
Next, learn all you can about credit scores, so you don’t have to go through this again. Try the site http://www.myfico.com as a start. http://Www.bankrate.com is also a great site for anything to do with money. At first you might think, "Yech!" but as you find yourself getting out of the hole by this knowledge, reading about money starts getting more and more interesting. You actually become enthused about making things happen for yourself — controlling your destiny — being rewarded, knowing what you’re doing, not being fooled by offers that used to be appealing when you were ignorant, etc. (no offense intended).
Next, get a part-time job of some kind. Even if it doesn’t pay as much as your current job, you will be surprised what difference a little bit more money makes. Then, when you get paid with the second job, pretend you don’t have that money, and just put it all toward your debts. What I did was to get one that paid a lot less than my main job, but was fun to do. So it didn’t feel like I was working, or at least not slaving my life away, and I didn’t get so tired. I considered it part of my socializing. A lot of all this is mental (attitude).
You could also try the suggestion about credit counseling, but I didn’t do that one because it is not as helpful these days as it was at one time. Now it is actually a bad mark on your credit report in the eyes of lenders. It tells them that you will likely not honor your debts, which will then reflect in the interest rates they offer you accordingly. Of course, you don’t want any more credit at this stage, but look at the effect on your report long term. Bad stuff can stay on there by law for about 7 years (or more, depending on the type of stuff). You don’t want to get all your debts down only to find that bad stuff is still following you around keeping your score much lower than it should be.
Next — and this is one of my favorite tools because it’s like having an assistant — I would suggest eventually getting a service called IdentityGuard (www.identityguard.com). If you get it through Costco, it costs less than $8 per month. It has been well worth the expense to me. You might want to wait until you’re making some progress out of the hole first, but keep it in mind. The indispensable thing on this site that helped me raise my score fast is called the Credit Analyzer. It lists all your debts (from the 3 major credit bureaus’ databases, so you don’t have to enter it yourself) and allows you to see how different hypothetical actions that you can take would affect your credit score — and it even tells you by how many points your score would be raised or lowered, if any. For instance, you can ask it to show you how your credit score would be affected if you paid as agreed for the next 3 months, or what if you applied for a new card, or spread out your debt among all your cards, or what if you paid off this one or that one.
For example, I was really surprised to find recently that simply closing 4 small accounts that I hardly ever used would move me from a Fair to a Good score. Without this tool, I never would have guessed!
Lastly, be patient with yourself. You have taken a huge first step simply by asking the question.
There are no fast fixes, unless you inhert a big chunk or something exceptional like that. It took a few years for me to move into the Good range, and I started as low as you are now. But if I had had just the few bits of knowledge that I just gave you, I guess I could have been out in a couple of years. I just didn’t have a family or other source that could tell me all of these things, so I just had to research and read for myself. What I just gave you is a distillation of years of experience.
Best wishes in your going onward and upward!
September 7th, 2010 at 9:48 am
check out http://www.howtoestablishgoodcredit.com as a place to start.
LOL man.
September 11th, 2010 at 9:22 pm
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