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01-11-2013 06:51 PM
Good day everyone:
My usual reason for denail & low Fico is high utilazation. Everymonth, I try to pay a fairly substantial amount on my credit cards but this is not working, all my limits are low I alternate the cards and the balances just keep jumping right back up. I am in balance liquidation program with chase, and I have almost paid off that account (2.5 yrs early). That is set payment that I cannot change. But I need to create a plan to pay off these debts to get my util down and score up.
Where do i start? I am not new to credit, but now that I am trying to finance my first car I am beginning to realize that my methods are just not working.
Any help is appreciated. Peace & Blessings
01-11-2013 11:48 PM
01-12-2013 02:14 AM
strictly use cash for living expenses except mortage, etc. No cash in pocket, then no purchases. As the prior poster said, you may need to change your spending habits. Cut out all NON ESSENTIALS, ie pop, Starbucks, fast food, convenience stores, cable, and yes extras on your cell telephone. Place the charge cards in a plastic bag and put in the freezer or in a worst case senario, cut them up.
01-12-2013 09:53 AM - edited 01-12-2013 09:57 AM
Yep, just like everyone else has said: sacrifice, cut out/down expenditures, pay as much as possible, and finally, patience!
Trust me, I am in the same boat as you! I have about $4700 on 8 cards that are at approx 80% utilization and (besides the obvious BK), I know that high utilization is killing me! BUT, in that point, I try not to stress about it, and just know that every extra dime I get, I just throw it on paying them off. Everybody has a different theory on how to pay off: debt snowball, highest interest rate card pay off first, etc, but at the end of the day, you need to have a plan and stick with it.
My goal is to have everything paid off by July/Aug range, and them I am closing 5 of those cards, slowly, over a 3-6 month period of time (a card will be essentially closed every other month, until I am down to 3 cards). Fortunately, I got a bit of good news yesterday; a big contract I've been working on has been accepted, so I will be getting a tidy sum for my business in a few weeks, so that helps, as one of my cards that I have on my personal account is a Cap 1 business card, so I can pay off the $500 I owe on that one (crosses fingers) by the end of the month, so I'll be down to 7 cards! Then, my tax returns will pay off two cards, plus I will throw $500 into my savings, so by March I'll only have 5 cards left to complete. It's a slow process, but I have it all written down, and I will be attacking it viciously!
Once all of the cards I'm closing are gone, I'm going to open a secured credit card for about $2,000-$3,000 so that I can have a card with a "normal" limit. I'm only going to keep my Barclay's, either my Cap 1 for business or my personal Cap 1 (which has a higher limit than my business one), and my Orchard Bank. The Cap 1's and Orchard will be the oldest ones on my credit, as I got those 2 months after I filed BK in 2010, so they will help my AAoA.
I said ALL of that to say, you aren't alone, and trust me, I don't relish giving up so much, but it's these little sacrifices that will help us sooo much more in the future! So what's so bad about ramen noodles and romaine lettuce salads for 6 months (have to have some veggies ).
01-12-2013 06:11 PM
01-12-2013 10:04 PM
01-13-2013 11:29 AM - edited 01-13-2013 11:33 AM
Thanks for your replies. Ramen noodles cracked me up.Queen I found your advice to be the most helpful though. I always knew that I was going to have to sit down and take a look at everything and really pen a plan. So I don't know exactly what route I'm going to take but I do know that have to do something because I don't spend that much but I just can't get the balances down. The good news however is that my walmart card is at 0 balance (yaaay me!) its going to stay that way. I think I might have to do a mashup of the small balances and high interest rate might actually be the best plan but I'll keep you guys up to date and let you know what I decide to do. And how it pans out. Trying to card debt free by years end
That's a good, and attainable goal to have! That's essentially my goal too; although, I want it to be sooner (around September). I have some really aggressive business goals in the next 2-3 years, so it's critical that I get my personal finances in order and down to as minimal as possible.
Like I said before, I can't stand it either, but it's like losing weight. You don't gain 10/20/30 lbs overnight, so it can't come off with a "magic pill" or overnight. It takes time. I can't stand this feeling of owing and bills (yea, I know that's life), and while I know credit is important, I want the least amount of bills possible! In my perfect world, I would pay all my bills at the beginning of the year: rent/mortgage, cell phones, insurance, and be done with it. I'd just need to buy food and gas on a weekly basis. For me, less is more! I give crazy props to those people who have dozens of cards with spreadsheets and such to keep track. I have neither the time, energy, patience or inclination to do all of that!