Have 15K to pay down cc's, advise?

[Anonymous]

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@noobody wrote:
really? a term loan at 21% Apr?
I have a question nobody touch here, they only give u 15200 out a 16k loan, is that means if u pay it off tomorrow, you still out 800? the 800 fee is ON TOP of 21% Apr? it looks like a terrible deal.
you want rob peter to pay Paul, actually robbed BY Peter.

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Lending Tree takes %5 off the top...period unless you have 700+ credit which we don't. Across the board this is a lower interest rate on avergae for all the cards that are being paid off by this loan. ALSO in 6mo-12mo when the credit score recover/and goes up, we have the option to get a better loan term.

[noobody]

got it, thanks for the explainaction.

so the new loan will NOT save u any money, but it will improve your score, as long as you do not run it up again, you will in much better financial position in 6 month.

[Anonymous]

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@noobody wrote:
got it, thanks for the explainaction.

so the new loan will NOT save u any money, but it will improve your score, as long as you do not run it up again, you will in much better financial position in 6 month.

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yes...we're not in dire strates, we could have and were paying down this debt making extra payments on our cards. The goal was to improve our scores and find a means to an end to these high APR cards. And also open up new and better lines of credit to get rewards for spending what we're already spending, as well as getting better rates.

[elim]

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@Creditdreamer wrote:
To save on the cost of the interest.

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  The only way to save interest on this 21% loan is to BT it back to a CC or replace the loan through a Credit Union..  I think I would have buckled down and payed off the CC debt myself (highest APR to lowest) until I could find a decent BT option.  The fee's plus APR are going to cancel out any savings on this loan. 

OP, After you get your utilization perfect and your scores climb, look for a way to significantly lower this APR.

Congrats for making the decision to get out from under this debt. It's much better to use your CC's then have them use you.

[Anonymous]

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@elim wrote:

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@Creditdreamer wrote:
To save on the cost of the interest.

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  The only way to save interest on this 21% loan is to BT it back to a CC or replace the loan through a Credit Union..  I think I would have buckled down and payed off the CC debt myself (highest APR to lowest) until I could find a decent BT option.  The fee's plus APR are going to cancel out any savings on this loan. 

OP, After you get your utilization perfect and your scores climb, look for a way to significantly lower this APR.

Congrats for making the decision to get out from under this debt. It's much better to use your CC's then have them use you.

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We tried to do what you're saying but couldn't get any cc to give us the BT high enough. That's why we went this route. At least this way we have some move on the credit scores giving it "hopefully" a better chance at a lower rate for the loan we had to take.

[Creditdreamer]

The biggest help is the mental change and taking steps in the right direction. You're doing a good job either way OP.

[Anonymous]

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@Anonymous wrote:

Ok here goes...

amount used, CL, min. payment, APR and age of account (thought I'd add that in case it makes a difference).

Discover-au $8,351.12 cl $8,500 mp $224 apr $25.99% age 7y 10m - (pay $6,700)

Capital One- au $3,378.65 cl $3,500 mp $62 apr $7.87% age 12y 9m - (pay $2,700)

Lowes- $1,836.22 cl $2,700 mp $62 apr $24.99% age 4y 5m - (pay $1,300)

Care Credit- $1,463.60 cl $2,200 mp $50 apr $26.99% age 2y 4m - (pay off)

Dell Financial- $1,416.27 cl $3,500 mp $43 apr $29.99% age 8m - (pay off)

Chase (Disney)- $1,920.40 cl $2,000 mp $44 apr $15.24% age 11m - (pay $1,520)

Sams Club- $599.87 cl $1,100 mp $25 apr $22.90% age 1y 3m - (pay off)

I'm not planning on using the money for anything other then cc's

Lending Tree (personal loan) $16,000 of which they took $800 leaving me with $15,200. Apr $20.99% for 36mo payment $599mo

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Street,

I would create a 6 month plan, with the following priorities.

1) Work toward paying down all cc accounts to below 20%, 15%, 10% if possible (This will raise your scores and thicken your profile for the 6th BT CC app)

2) Pay off smaller balances to reduce monthly payments. (bring a few dollars to the table)

3) 3 month period go after CLI's for all your CC's and check for BT offer on your discover card (thicken profile for the 6 month app for BT CC's)

4) Pay down highest apr accounts when extra funds that become available 

5) At the 6 month time frame, app for 3 new 0% intro BT cards and move the remaining balances from your loan.

6) Create a 1 year plan to pay down remaining card balances with apr.

[takeshi74]

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@Anonymous wrote:

Ok here goes...

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Make a spreadsheet with current balances, limits, estimated payment, balance after payment and calculate utilization before and after.  Get you highest utilization cards down ASAP.  It's not scoring that is your biggest concern at this point but possible adverse action.  Once you're under a ceertain threshold, say 50%, on all cards then focus on APR.  Your call if the snowball method would benefit you or not,

Make sure you're addressing the reason why you got into this siutation to begin with or else you'll be even worse off with installment and revolving debt.

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@Anonymous wrote:

We tried to do what you're saying but couldn't get any cc to give us the BT high enough.

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You cannot rely on a new card for a BT if you have high revolving utilization. Revolving utilization has a high impact, falling under Amounts Owed.

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

Even if approved you would get low limits, high APR's, etc.

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

Are any of those cards on intro periods?

My initial thought it to payoff the Discover, and then start with the highest APR and work your way down. Make sure you make minimum payments on everything first.

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Why make the minimum payment on the cards first? And no I don't believe any of them have an intro period.

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I think you should do the minimum payments first, because the worst thing you can do is to miss a payment. Then you get late fees and, if you miss by more than 30 days, a late mark on your credit report, which will have a significant impact on your score. Instead, pay the minimujms, then figure out where you want your remaining money to go. I agree with the previous posters who say you should ask for a 0% BT APR period after you pay it off. You may need to wait a month or two for that, but it will allow you to pay 3% up front for 0% APR for the year on the $8k or so that you could transfer. You could also use it to pay off the personal loan, when the time comes. However, you do need to make sure you pay it off before the 0% rate ends, which is measured to the day, not the statement.

[NRB525]

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@Anonymous wrote:

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@Creditdreamer wrote:
I also agree with what a PP said with trying to get an intro rate from discover and then balance transferring after its paid off from one of the other cards left over. Discover gave me a 0% apr and all just because I asked. I'm not using it, but it's there at least in case I need it.

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How would one get this intro APR if they already have a Discover card? Just paying it off and asking for 0% APR for BT? 

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Check online on your Discover account, go to the Account --> Credit Options --> Balance Transfer and check whether an offer already exists. With your current high Discover balance, there may not be, but I'd bet dollars to donuts that once it is paid down, a BT offer is there. This is the screen from yesterday, and I've got 34% utilization already on the card with an existing BT offer.