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09Lexie
Posts: 22,437
Registered: ‎09-13-2012

Re: chase credit limit decrease

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JonStur
Posts: 900
Registered: ‎12-25-2010

Re: chase credit limit decrease


s_rob7488 wrote:
Really do appreciate all the respinses, even the bad ones :-) I have a spreadsheet (piece of paper for now) with balances, interest rates, and am trying to see where I can combine balances if possible. I didn't get much sleep last night as I was trying to get my ducks in order as much as possible and call a few of the banks to see if I have options for BTs or or lower interest etc. I have one thought of using the loan from the 401k for $3300 and applying it to whichever balances would be subject to interest or the bank of america card to make a dent in the current balance. I am thinking of this route since it doesn't effect anything with taxes for taking the loan off the 401k and its not draining the account. As for the people whove stated it was not a good time for a vacation, I admit I splurged too much on the trip. It was overseas and I hhadmoney set aside for the trip but has proved to not have been the best idea. Bottom line I know I am in a bad position and I am hoping I can get out of it as soon as I can. I have put all cards except amex delta which is my daily use card and my debit card in my safe and dont plan to buy anything other than toilet paper and groceries and only necessities for a few months. I've discussed with my wife the situation and she is aware of everything. Other than my csp she isnt listed on any of the accounts so credit wise she shouldnt be effected correct me if I am wrong but I feel terrible for putting her in this situation as well. I know what needs to be done just need to stick to my plan and start to pay down one by one and will know for the future what not to do. I dont blame anyone for saying anything harsh bc truth is I need to hear it. I have been thrown off by some comments and have thought to myself **bleep** why would someone say that but then come to my senses that its all brought upon by me and I need to take the advice of people who 1 have been generous enough to weigh in on the topic and 2 have experiences of their own. Again, I do appreciate the feedback. Lastly I dont plan on contacting chase until things are looking better than now. If I lose the credit line then I lose it. My fault yes but the only way to make progress is to learn from the mistakes and go forward.

The best lessons are usually the hardest.. I have a feeling after this you will be a credit expert!!!!


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Super Contributor
enharu
Posts: 6,828
Registered: ‎02-27-2013

Re: chase credit limit decrease

@s_rob7488,

look into getting a 0% or low APR BT, or a consolidation loan, or any kind private loan as long as the interest rate is going to be lower than your credit cards.

Right now you have about 23-25k total in CC debt. Assuming 15% APR (im being conservative here), interests alone is about $300 each month. That is enough to lease a BMW / Mercedes or even finance a cheaper car :/


Work on paying your debt down. The process isn't easy but it's what you have to do. Best of luck!

 

 

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gstq34
Posts: 116
Registered: ‎06-08-2013

Re: chase credit limit decrease

I see people saying things like "dragging high BAL across multiple cards will lead to AA"  

 

Stupid question...what is AA?!?



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w20031424
Posts: 360
Registered: ‎10-17-2012

Re: chase credit limit decrease

I got some idea to help you kill these interests. Already PMed you.

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09Lexie
Posts: 22,437
Registered: ‎09-13-2012

Re: chase credit limit decrease

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Stralem
Posts: 301
Registered: ‎10-08-2011

Re: chase credit limit decrease

Gah.

 

Reading this thread has made me skittish about floating balances and my current 39% util.

 

I'm going out for some Sierra Nevada to calm my nerves.

            
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longtimelurker
Posts: 4,164
Registered: ‎04-22-2013

Re: chase credit limit decrease

[ Edited ]

s_rob7488 wrote:
I have one thought of using the loan from the 401k for $3300 and applying it to whichever balances would be subject to interest or the bank of america card to make a dent in the current balance. I am thinking of this route since it doesn't effect anything with taxes for taking the loan off the 401k and its not draining the account.

Not many of the responses have addressed this, and I am interested in what people think.   

 

In retirement seminars (sponsored by firms offering 401Ks, so not totally unbiased!) the usual mantra is a) Never do an early withdrawal (not least because of the tax penalties) and b) Don't do loans either, because even though you are paying yourself back, with some interest, you are missing out on the growth that the withdrawn assets might/could/would experience.   Exceptions are sometimes made for things like a house downpayment, because, in theory, that asset could appreciate as much as the 401K.

 

One thing that is mentioned is how many years before retirement.  Works both ways, if it is many years, you have time to more than replenish the funds to gain back some of the growth, but equally, if you don't, you are missing out on years of growth.

 

 

In your case, this might be a reasonable use, but it sounds like the amount of money you are talking about will only make a small dent.


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Moderator
09Lexie
Posts: 22,437
Registered: ‎09-13-2012

Re: chase credit limit decrease

@longtimelurker

Good points about borrowing from 401k. The dollar amount is small and shouldn't be a huge problem. It becomes more of an issue if OP uses it as a savings account. :smileysad:

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ezdoesit
Posts: 480
Registered: ‎03-16-2013

Re: chase credit limit decrease


longtimelurker wrote:

s_rob7488 wrote:
I have one thought of using the loan from the 401k for $3300 and applying it to whichever balances would be subject to interest or the bank of america card to make a dent in the current balance. I am thinking of this route since it doesn't effect anything with taxes for taking the loan off the 401k and its not draining the account.

Not many of the responses have addressed this, and I am interested in what people think.   

 

In retirement seminars (sponsored by firms offering 401Ks, so not totally unbiased!) the usual mantra is a) Never do an early withdrawal (not least because of the tax penalties) and b) Don't do loans either, because even though you are paying yourself back, with some interest, you are missing out on the growth that the withdrawn assets might/could/would experience.   Exceptions are sometimes made for things like a house downpayment, because, in theory, that asset could appreciate as much as the 401K.

 

One thing that is mentioned is how many years before retirement.  Works both ways, if it is many years, you have time to more than replenish the funds to gain back some of the growth, but equally, if you don't, you are missing out on years of growth.

 

 

In your case, this might be a reasonable use, but it sounds like the amount of money you are talking about will only make a small dent.


It is funny you just posted this because I just PM'ed him telling to take advantage of the loan against the 401k if he could. 

 

This is why because right now he is losing probably around 15% a year on his outstanding balance.  If he were to take a loan on the full amount he would have a net gain of about 19%.  He is not losing 15% but gaining an additional 4.25%.  I don't know like you said maybe I am thinking about this the wrong way.


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