IS THIS A GOOD DEAL?

[Anonymous]

Nope.  Money too tight, revolving debt too high and if we don't do this, we could lose the house.  I have tried so many lenders, just yesterday my credit union, and they can't help.  We had to use our credit cards to pay our bills and then we were barely able to make the minimum payments to keep from getting lates on our credit reports.  I am sure it will get better because other than trying to put the house on the market, we really don't have any other options.

[Anonymous]

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myhearts07 wrote:

Nope.  Money too tight, revolving debt too high and if we don't do this, we could lose the house.  I have tried so many lenders, just yesterday my credit union, and they can't help.  We had to use our credit cards to pay our bills and then we were barely able to make the minimum payments to keep from getting lates on our credit reports.  I am sure it will get better because other than trying to put the house on the market, we really don't have any other options.

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Myhearts, do this, but PLEASE:

A-make sure you can realistically make the new consolidated payment.  Many people do this and find that while they're saving monthly over where they were before, their payments are still overall too high for their income, and out come the credit cards again.

B-charge just enough on one or two cards to keep them active and at 1% - 10% utilization.  Really only have to worry about 3 credit cards or so, more than that you can get dinged for "too many accounts with balances" on your FICO

C-change your overall financial outlook so as to avoid this happening again.

[Anonymous]

Thank you, Joe and I take everything that you said to heart and I will do as you suggest.  I did our budget and this will work for us.  I will only use the number of cards that you suggested and we are thinking about getting rid of those high interest capital one cards.  Do you think that will hurt our scores much?  The cards are about 3-4 years old and I don't want that to hurt the age of our credit history but then I don't want to get ripped off continually either.  I have learned so much about credit on this site and trust me, we are too scared to mess ourselves up again because there won't be a way out, we will be stuck.

Let you know what happens when we get the word on the loan.

Eve

[Anonymous]

Eve~ I hope everything works out for you and yours! And you know you've got a sounding board here when you need one!

Tex

[Anonymous]

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myhearts07 wrote:

Thank you, Joe and I take everything that you said to heart and I will do as you suggest.  I did our budget and this will work for us.  I will only use the number of cards that you suggested and we are thinking about getting rid of those high interest capital one cards.  Do you think that will hurt our scores much?  The cards are about 3-4 years old and I don't want that to hurt the age of our credit history but then I don't want to get ripped off continually either.  I have learned so much about credit on this site and trust me, we are too scared to mess ourselves up again because there won't be a way out, we will be stuck.

Let you know what happens when we get the word on the loan.

Eve

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Actually, this is what I'd do:

Keep all the cards for now, and alternate which two or three cards you use that month.  Always keep the balance low enough to pay off in full each month except for a couple dollars (this keeps the accounts active) and then the next month, charge a candy bar on the card that's empty, then pay off the one you used the month before.  Doing this keeps all the accounts active, but keeps you from paying interest.  You can even pay off the 2 or 3 you use in full each month, if you do it after the date they report to the bureaus (you can call the CCC and ask) but before your grace period on interest is up.

As far as Cap One, wait a few months for your FICO's to go up due to reduced util, THEN tell them "lower my fees and rates or I cancel the card" and see if they play ball, so to speak - otherwise, cancel them.

[Anonymous]

Okay.  Question though?  In following your suggestions, keeping util low and using cards as you suggested and paying them off, how long  do you think that it would take to get a high enough mid-fico scores to refinance out of the arm?  Is there a restriction as to how many months or years you have to wait to refi in this type of loan?  There is no prepayment penalty.

[Anonymous]

You indicated there was no pre-payment penalty (very unusual for this type of loan)

That is ussualy the only thing (beside org fee)  to keep you from re-fi in a few months/ a year

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myhearts07 wrote:

Okay.  Question though?  In following your suggestions, keeping util low and using cards as you suggested and paying them off, how long  do you think that it would take to get a high enough mid-fico scores to refinance out of the arm?  Is there a restriction as to how many months or years you have to wait to refi in this type of loan?  There is no prepayment penalty.

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[Anonymous]

looking at the pprwrk now, no prepay penlty.  loan based on 18 mo on-time pymts.