topic Re: HSBC Kawasaki Card Nightmare in Credit Cards

HSBC Kawasaki Card Nightmare

Kennie02 — Thu, 24 May 2012 18:56:58 GMT

Just looking for some advice on how to handle this CC I have w/ HSBC (now CapOne). 5 years ago my DH had the bright idea to purchase a brand new Kawasaki motorcycle. Instead of getting a motorcycle loan through our credit union or bank he put this motorcycle on a HSBC CC. We have been paying this CC faithfully for the last 5 years and I am just done with it. With the economy and all the CC changes, our CL was reduced from 12K about three times to its current CL of 5k. That has done terrible things to my utilization because it looks like the card is maxed out. I am honestly frustrated with this CC. My solution is to just not pay this card and let it go. But I know that's a terrible choice. Its difficult for me because I save the $200 monthly payment or use it to pay other debt. I have thought about just closing the CC in the hopes that it will keep them from continuing to lower my CL. Any suggestions?

Re: HSBC Kawasaki Card Nightmare

Anonymous — Thu, 24 May 2012 19:24:14 GMT

Just curious what is the intreast rate?

Re: HSBC Kawasaki Card Nightmare

ILBrian — Thu, 24 May 2012 19:44:43 GMT

If you let the payment go utilization would be the least of your problems.. not sure why this would ever be an option-

Close the account if you want the CL to stop dropping, once closed the CL is effectively 0 but will continue to report the limit before closure...

Anytime you carry a large balance for a huge amount of time you can expect to be limit chased by many issuers sadly

perhaps consider refinancing through a CU or bank on the bike?

Re: HSBC Kawasaki Card Nightmare

Kennie02 — Thu, 24 May 2012 19:48:01 GMT

The interest rate is not terrible. Its 9.99% for the motorcycle balance. The rate for other purchases is 19.99% which is only on a balance of $79. Honestly it is getting difficult to make the minimum payments. My DH got a new job so we moved from CA to IL. In the process I have become unemployed. With our reduced income it is often tough to send the payment to them. Especially when they keep lowering my CL!!

Re: HSBC Kawasaki Card Nightmare

ILBrian — Thu, 24 May 2012 19:53:25 GMT

not sure how old the bike is or if its valued higher but as I said it might be worth going to the bank and refinancing that puppy into an installment loan

Re: HSBC Kawasaki Card Nightmare

Anonymous — Thu, 24 May 2012 20:33:16 GMT

My advice would be to try to refinance it. Just not paying anymore is going to screw you over long term. Probably immediately go to a punitive rate of 29.99% and it's definitely enough of a balance for them to try to get a judgment. In reaction to the change, your other credit cards can increase your interest with a 45 day (I think) warning even if you've never missed a payment with them. The derogatory of the lates you'll accrue will stay on your credit for 7 years. Utilization is a temporary issue, as soon as it's paid off, the problem is gone. The lates your talking about accruing will tank your score for a long time and make a lot of other things just plain unaffordable. We've been shopping for home owners insurance and my credit is making it downright expensive because where I live my credit affects how much I pay for insurance.

If the bike is just a recreational vehicle and you can't refinance it, then sell it. Sell jewelry, sell whatever it takes to pay it off. If you want to buy a toy, you buy it with cash. If you can't afford to pay cash, you cant afford to have said toy. Please note, this is coming from a person who has financed a sewing machine and a grand piano. I was a moron. I wasn't making enough to justify a $10,000 piano. Just because I wanted it didn't mean I should own it. Long story short, piano got sold and I got a second job to pay off that loan I couldn't afford. I haven't been able to afford to buy another piano and have now gone without one for 5 years despite taking lessons for 15 years. Playing the piano was what I did every morning when I woke up and as soon as I got home from work. Not having a piano has left a huge void in my life and I kick myself on a regular basis for ever trading in that old piano that was paid off for a measly $100 bucks to buy the one I couldn't afford and ended up having to sell anyways. Lesson learned, never put a toy on credit, unless you have the cash to pay off immediately and are just running it through for the points/rewards.

Re: HSBC Kawasaki Card Nightmare

emptypockets — Thu, 24 May 2012 21:05:19 GMT

If this is the Kawasaki Good Times credit card, then technically the bike is not paid for. Those cards may possibly be one where the bike purchase is charged to it, and the payments are a set rate for 3-4 yrs, with a low interest rate, then if not paid for after the promo, the payments go up. The way the finanacing is structured, unless you make way larger payments than the set rate, you will owe WAY more than the original amount after a few yrs. I believe that as long as there is a balance for the bike on the card, they may have a Lein on the bike, so if you stop paying, they will repo the bike. You can look into refinancing it, but depending on what you owe, u may have a problem getting enough to pay it off.

Re: HSBC Kawasaki Card Nightmare

Anonymous — Thu, 24 May 2012 21:11:10 GMT

You should have gotten a secured loan through a CU years ago... My bank was financed at 3.9% for a couple years, but it was only $5k.. Never buy a new motorcycle. The depreciation is far worse than a car, and the fees always seem more excessive, too.

I would never finance through a dealer. They are pretty crooked sometimes. I went looking for a bike 7 years ago, and I could not get out of the dealership. After about 3 hours, I finally said, "look quit trying to sell me other bikes. I wanted this bike, and if I'm not approved for it, I'm walking." So I finally walked. Turns out, at some point in the conversation, they opened me up a $6k line of credit that I found on my credit report. The bike I was looking at was $9k BEFORE fees. So, I bought the same bike, but 2 years older, with 1800 miles, for $5k.

I'm sure you've learned that lesson already, just thought I'd share. If there is no lein against your bike, I'd get it refinanced immediately at a much lower rate.

Re: HSBC Kawasaki Card Nightmare

Kennie02 — Thu, 24 May 2012 23:23:25 GMT

My husband talked to my CU and they said that we can't refinance a CC into a motorcycle loan. So that option is out the door. I really don't want to not pay the bike because as most of you said it will hurt us in the long run. It was really never my idea to purchase this bike (I was completely against it as I was pregnant with twins at the time. Where are you going to put two car seats on a bike was my question) nor is this CC in my name. It is one of the biggest financial mistakes my DH has made. The worst part of all of this is that my husband wrecked his bike, while riding w/out full coverage insurance of course, and so he no longer rides it. It needs a lot of work and even if we got it fixed (which we can't afford anyway) we could not sell it because we do not yet own it. emptypockets you are completely correct on how this CC is set up. The current 9.99% rate is the increase from the original 6.9% interest rate he was told. It has been 6 years that this CC is getting paid and I have nothing to show for it.

The only other option I can think of at this point is to attempt to get a debt consolidation loan to try and just pay this card off.

Re: HSBC Kawasaki Card Nightmare

Anonymous — Thu, 24 May 2012 23:40:35 GMT

im really sorry to hear what has happened. we all make mistakes and we all learn from them. well most of us do. please just sit down with your husband and come up with a plan that you both agree on to get this loan paid for. how much do you owe till you pay it off? if you stop paying on it now it will haunt you down the road

Re: HSBC Kawasaki Card Nightmare

ILBrian — Fri, 25 May 2012 00:58:06 GMT

dont just talk to one bank and is there a lein already on this bike? Talk to many banks see if any can do cash out refinancing

Re: HSBC Kawasaki Card Nightmare

tcbofade — Fri, 25 May 2012 01:14:54 GMT

@Anonymous wrote:
im really sorry to hear what has happened. we all make mistakes and we all learn from them. well most of us do. please just sit down with your husband and come up with a plan that you both agree on to get this loan paid for. how much do you owe till you pay it off? if you stop paying on it now it will haunt you down the road

If necessary, sit down with your husband and a 2x4 and figure out what you're going to do.

A "debt consolidation loan" is NOT a bad thing, and may be just the answer. Have you talked to your bank or CU about this recently?

I agree with the others..."walking away" is NOT the answer, and it will haunt you both for a LONG time...

Re: HSBC Kawasaki Card Nightmare

Kennie02 — Fri, 25 May 2012 01:58:24 GMT

As of my last statement we owe $5845. I hate looking at this number. Its so high and more than the stupid bike is worth. I am not sure if their is a lein on the bike. Technically HSBC (or CapOne) still own it because it hasn't been paid off. From speaking to a rep they won't really repo it and just continue to come after you for the money. I tried to get a consolidation loan through my CU but was denied because my husband's salary is the only income we have. As you can see from my sig my CS is not that high and so I am afraid I will continue to get denied.

Re: HSBC Kawasaki Card Nightmare

Kennie02 — Fri, 25 May 2012 01:59:12 GMT

ILBrian what is cash out refinancing?

Re: HSBC Kawasaki Card Nightmare

Anonymous — Fri, 25 May 2012 02:37:21 GMT

Sure go to the credit union and get a refi with it through them. Odds are there APR will be much lower than the HSBC card! Or if you have a card that you can do a 12 month 0% apr on then maybe that is a better option just keep in mind that most cards with that kind of promo APR will charge you a one time transfer fee usually around 4% unless is't NFCU then they have a 18 month zero percent promo and zero percent transfer fee or zero transfer fee! They rock!!! I actually did the same thing a while back with my Suzuki HSBC account best thing I ever did!!

Re: HSBC Kawasaki Card Nightmare

Watchmann — Fri, 25 May 2012 03:33:38 GMT

I have a Yamaha account through HSBC (now Cap One) and it probably operates the same as your Kawasaki card, the account is set up like a revolving credit card account and they usually have a low APR (2 or 4%) for about 3 years when you purchase a new bike. You have to treat these accounts like a vehicle loan and have a set monthly payment in your budget, and then set it up online for it to draft the correct amount out each month so you pay it back within the low interest period. When you do that they are a perfectly fine way to finance a bike......cheap and easy. I've done two Yamahas this way with no issues, and I pay it back in about two years. Unfortunately many bike buyers and young and inexperienced so they buy the bike, wreck it, and then try to walk away, or they run out of months on the cheap APR and then get whacked with a 29% APR rate and they are paying $200 a month on it.

You are all fouled up if you still have a $5,845 balance after five years......you really don't have many options here. HSBC holds the title to the bike and they will continue to come after you if you stop payment.....they do NOT want the bike back, they just want their money. You are not likely to get a vehicle refinance loan since the existing loan is not a vehicle loan, it is a credit card loan. I would not stop payment unless you are looking for a serious ding on your credit. What's the Kaw worth? Take it to the dealer and see what he will buy it back for and he'll do all the paperwork. It's probably not worth what you owe on it but it may reduce a chunk of the remaining balance which then you can work to pay off ASAP. It still has value even it is is damaged or not working. Get rid of the bike as the first step in getting out of this hole.

Re: HSBC Kawasaki Card Nightmare

ILBrian — Fri, 25 May 2012 06:07:14 GMT

For example, I have a car that has a clear title (not sure of the bikes title status from the messages) I can go to a CU/bank and ask for cash out on the car. This in essence is "refinancing". I actually did this recently to consolidate some debt into a nice 3% interest rate. They typically give you 100/125% of the value

Re: HSBC Kawasaki Card Nightmare

Repo-ed — Fri, 25 May 2012 10:39:29 GMT

Outside looking in, and having been in your situation before, you either need to get a job (part-time or full) or your DH needs to get a 2nd job and help get this thing knocked out.

Stop paying on it, and you'll have FAR more than a 5900$ headache. Believe that...

Re: HSBC Kawasaki Card Nightmare

Anonymous — Fri, 25 May 2012 13:16:31 GMT

How is your credit? Could you qualify for a new CC with a 0% interest rate for 12 months or more? That might help you get the payments under control if you can't refinance from a CC.

Re: HSBC Kawasaki Card Nightmare

crunching_numbers — Fri, 25 May 2012 13:29:42 GMT

@Anonymous wrote:
How is your credit? Could you qualify for a new CC with a 0% interest rate for 12 months or more? That might help you get the payments under control if you can't refinance from a CC.

This would get that debt gone and transfered to a different creditor with 12 to 18 months of no interest to make headway getting the debt down, and hopefully better terms at the end of the promo period if you can't get the debt gone by then. This is one of those rock and a hard place times in life where you just have to get out of the situation so you can move forward.