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Debt Consolidation- Please Help!!

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Debtdebt
New Member

Debt Consolidation- Please Help!!

Hi, 

Im freaking out and living paycheck to paycheck due to massive credit card debt that I have accumulated over the last few years. Credit Card Debt is about $83k overall and 57% credit card usage... I use to have BT promos that have since expired at some point this year, driving my monthly bills way up. I have $8k in my savings for emergencies. I need immediate advice on how to tackle this and consolidate my debt. Due to the debt, first thing I will do is sell my car to get rid of the $855/month car loan and just use my beater car thats paid off and runs well. Sitting at 712 Fico Score. What are my options as I'm currently stressing everyday and losing sleep thinking about the debt and don't know what to do!? Do you think a local Credit Union would help me out with consolidating this debt into some sort of fixed loan? I also have about $100k equity in my house, but I heard banks aren't doing HELOCs at the moment and my DTI is too high. Thank you in advance to everyone who takes a minute to look at my situation. I will gladly update with other info needed. 

 

-Monthly take home pay is $4800 (guaranteed), but usually bring home $5200 after Overtime. 

 

-Mortgage $1830/month 

-Chase Sapphire $407/month ($13.8k/$14k) 24.24%

-Citi Diamond $593/month ($26k/$28.5k) 20.24%

-BOA $628/month ($19k/$30k) 28.74%

-Amex Blue $310/month ($10k/$10.5k) 25.74%

-Chase freedom unlimited $155/month ($14k/$15k) 21.24%

- CU loan $450/month 

- Car loan $855/month 

*TOTAL monthly debt is currently $5288

 

Thank you for taking the time to look at my post and offering any advice. Happy Holidays. 

 

 

 

Message 1 of 14
13 REPLIES 13
SouthJamaica
Mega Contributor

Re: Debt Consolidation- Please Help!!


@Debtdebt wrote:

Hi, 

Im freaking out and living paycheck to paycheck due to massive credit card debt that I have accumulated over the last few years. Credit Card Debt is about $83k overall and 57% credit card usage... I use to have BT promos that have since expired at some point this year, driving my monthly bills way up. I have $8k in my savings for emergencies. I need immediate advice on how to tackle this and consolidate my debt. Due to the debt, first thing I will do is sell my car to get rid of the $855/month car loan and just use my beater car thats paid off and runs well. Sitting at 712 Fico Score. What are my options as I'm currently stressing everyday and losing sleep thinking about the debt and don't know what to do!? Do you think a local Credit Union would help me out with consolidating this debt into some sort of fixed loan? I also have about $100k equity in my house, but I heard banks aren't doing HELOCs at the moment and my DTI is too high. Thank you in advance to everyone who takes a minute to look at my situation. I will gladly update with other info needed. 

 

-Monthly take home pay is $4800 (guaranteed), but usually bring home $5200 after Overtime. 

 

-Mortgage $1830/month 

-Chase Sapphire $407/month ($13.8k/$14k) 24.24%

-Citi Diamond $593/month ($26k/$28.5k) 20.24%

-BOA $628/month ($19k/$30k) 28.74%

-Amex Blue $310/month ($10k/$10.5k) 25.74%

-Chase freedom unlimited $155/month ($14k/$15k) 21.24%

- CU loan $450/month 

- Car loan $855/month 

*TOTAL monthly debt is currently $5288

 

Thank you for taking the time to look at my post and offering any advice. Happy Holidays. 

 

 

 


1. You've already identified one thing you need to get rid of, the $855 month car loan.

2.  You've also identified what I think would be another good move -- a credit union debt consolidation loan. You're not going to get a big enough loan to tackle all the credit cards, so what I would do is get a loan to tackle the BOA card. Pay that card to zero, and don't use it again for awhile except for tiny numbers which you can pay off before the statement even cuts.

3.  Then I would start reducing balances to 88%, then reducing balances to 78%, to get out of the "maxed out" zone.

4.  Once I got them all to 48% or less, I would start snowballing. (Paying smallest balance to zero, then next smallest, etc.)

5.  As you've probably figured out, it would be good if you could supplement your income and apply the additional income to the credit card payments. So more overtime and/or a side gig would be nice if possible.

 


Total revolving limits 650200 (530700 reporting) FICO 8: EQ 708 TU 714 EX 715

Message 2 of 14
SlideOrInsert
Regular Contributor

Re: Debt Consolidation- Please Help!!

I would not replace unsecured debt with heloc debt secured by my home.

 

of the $2093 in payments to the credit cards, only $458 is being applied to the principal balances. you are hemorrhaging interest. also, the math does not check out for the $155 monthly payment for Chase Freedom; the payment is less than the interest accruing and minimums are usually at least 2% of the balance, which is $280.

 limitbalanceaprminintutil
BOA300001900028.74-62845563
Amex Blue105001000025.74-31021595
Chase Sapphire140001380024.24-40727999
Chase Freedom150001400021.24-15524893
Citi Diamond285002600020.24-59343991
TOTAL980008280023.69-2093163584
CU Loan   -450  
Mortgage   -1830  
EXPENSES   -4373  
INCOME   4800  
diff   427  


it looks like at least a year before all your revolving accounts are below the maxed out 88.9% threshold:

 limitbalanceaprminnpernew balnew util
BOA300001900028.74-628111685356
Amex Blue105001000025.74-31011882984
Chase Sapphire140001380024.24-407111218087
Chase Freedom150001400021.24-1551115116101
Citi Diamond285002600020.24-593112415085
TOTAL980008280023.69-2093 7712879

 

at that time, I would seek out a personal loan of 25-30K to consolidate BOA and Amex Blue. a personal loan from discover, marcus, etc will give you an estimated amount and rate without a hard inquiry. I am not sure you would qualify for one now, but you can try.

 

in any case, because the interest on your accounts is so expensive and your budget is so tight, I would emphasize that the avalanche method is probably the best way to pay things going forward.  the snowball will drag it out even more ridiculously expensive and slow than it already is.

 

if I was $83000 in debt with stifling interest, I would try a free consultation with at least two bankruptcy attorneys just to get some insight what it might look like.

 

upgrade
9/2022
$30000
nfcu
8/2020
$20000
nfcu
12/2018
$30000
bofa
8/2016
$30000
citi
3/2016
$21000
discover
5/2014
$20000
chase
10/2007
$8900
Message 3 of 14
NoMoreE46
Community Leader
Senior Contributor

Re: Debt Consolidation- Please Help!!

I am glad that you're here trying to get some advice.

Feel free to see what many others have gone through and post more questions in the Bouncing Back from Credit Problems area.

 

Personally,  l think you should have a session with a BK attorney.

 

 

Message 4 of 14
Debtdebt
New Member

Re: Debt Consolidation- Please Help!!


@SouthJamaica wrote:

@Debtdebt wrote:

Hi, 

Im freaking out and living paycheck to paycheck due to massive credit card debt that I have accumulated over the last few years. Credit Card Debt is about $83k overall and 57% credit card usage... I use to have BT promos that have since expired at some point this year, driving my monthly bills way up. I have $8k in my savings for emergencies. I need immediate advice on how to tackle this and consolidate my debt. Due to the debt, first thing I will do is sell my car to get rid of the $855/month car loan and just use my beater car thats paid off and runs well. Sitting at 712 Fico Score. What are my options as I'm currently stressing everyday and losing sleep thinking about the debt and don't know what to do!? Do you think a local Credit Union would help me out with consolidating this debt into some sort of fixed loan? I also have about $100k equity in my house, but I heard banks aren't doing HELOCs at the moment and my DTI is too high. Thank you in advance to everyone who takes a minute to look at my situation. I will gladly update with other info needed. 

 

-Monthly take home pay is $4800 (guaranteed), but usually bring home $5200 after Overtime. 

 

-Mortgage $1830/month 

-Chase Sapphire $407/month ($13.8k/$14k) 24.24%

-Citi Diamond $593/month ($26k/$28.5k) 20.24%

-BOA $628/month ($19k/$30k) 28.74%

-Amex Blue $310/month ($10k/$10.5k) 25.74%

-Chase freedom unlimited $155/month ($14k/$15k) 21.24%

- CU loan $450/month 

- Car loan $855/month 

*TOTAL monthly debt is currently $5288

 

Thank you for taking the time to look at my post and offering any advice. Happy Holidays. 

 

 

 


1. You've already identified one thing you need to get rid of, the $855 month car loan.

2.  You've also identified what I think would be another good move -- a credit union debt consolidation loan. You're not going to get a big enough loan to tackle all the credit cards, so what I would do is get a loan to tackle the BOA card. Pay it to zero, and don't use it again for awhile except for tiny numbers which you can pay off before the statement cuts.

3.  Then I would start reducing balances to 88%, then reducing balances to 78%, to get out of the "maxed out" zone.

4.  Once I got them all to 48% or less, I would start snowballing. (Paying smallest balance to zero, then next smallest, etc.)

5.  As you've probably figured out, it would be good if you could supplement your income and apply the additional income to the credit card payments. So more overtime and/or a side gig would be nice if possible.

 



Thank you for the advice provided! 

Message 5 of 14
Debtdebt
New Member

Re: Debt Consolidation- Please Help!!


@SlideOrInsert wrote:

I would not replace unsecured debt with heloc debt secured by my home.

 

of the $2093 in payments to the credit cards, only $458 is being applied to the principal balances. you are hemorrhaging interest. also, the math does not check out for the $155 monthly payment for Chase Freedom; the payment is less than the interest accruing and minimums are usually at least 2% of the balance, which is $280.

 limitbalanceaprminintutil
BOA300001900028.74-62845563
Amex Blue105001000025.74-31021595
Chase Sapphire140001380024.24-40727999
Chase Freedom150001400021.24-15524893
Citi Diamond285002600020.24-59343991
TOTAL980008280023.69-2093163584
CU Loan   -450  
Mortgage   -1830  
EXPENSES   -4373  
INCOME   4800  
diff   427  


it looks like at least a year before all your revolving accounts are below the maxed out 88.9% threshold:

 limitbalanceaprminnpernew balnew util
BOA300001900028.74-628111685356
Amex Blue105001000025.74-31011882984
Chase Sapphire140001380024.24-407111218087
Chase Freedom150001400021.24-1551115116101
Citi Diamond285002600020.24-593112415085
TOTAL980008280023.69-2093 7712879

 

at that time, I would seek out a personal loan of 25-30K to consolidate BOA and Amex Blue. a personal loan from discover, marcus, etc will give you an estimated amount and rate without a hard inquiry. I am not sure you would qualify for one now, but you can try.

 

in any case, because the interest on your accounts is so expensive and your budget is so tight, I would emphasize that the avalanche method is probably the best way to pay things going forward.  the snowball will drag it out even more ridiculously expensive and slow than it already is.

 

if I was $83000 in debt with stifling interest, I would try a free consultation with at least two bankruptcy attorneys just to get some insight what it might look like.

 



Thank you for making a chart so it's easier to see.

 

The chase freedom card just ended the promo. The $155 is the old/current monthly payment and next months the payment will be at the new rate I listed. 

 

I have been doing the avalanche method lately with the discretionary income I have. I was previously doing the snowball method but didn't feel like it was making much of a dent in the debt.

 

I am scared of bankruptcy and the effect it would have on my family and home. Never been through one and don't know anyone that went through one either. I'm just glad I have a stable job with benefits. 

Message 6 of 14
Debtdebt
New Member

Re: Debt Consolidation- Please Help!!


@NoMoreE46 wrote:

I am glad that you're here trying to get some advice.

Feel free to see what many others have gone through and post more questions in the Bouncing Back from Credit Problems area.

 

Personally,  l think you should have a session with a BK attorney.

 

 



Thank you I will look into the bouncing back from credit problems area. I haven't checked it out yet. I'll be doing some reading today 

Message 7 of 14
SlideOrInsert
Regular Contributor

Re: Debt Consolidation- Please Help!!


@Debtdebt wrote:
I am scared of bankruptcy and the effect it would have on my family and home. Never been through one and don't know anyone that went through one either. I'm just glad I have a stable job with benefits.

bk is definitely not to be taken lightly. but it is good to know all your options. in any case, I am not advocating for/against bk, I am advocating that you are informed about all your options.

 

just for exercise, consider the following table:

balanceaprpmtnpercumipmttotal pmt
8280023.69-23675-59227-142027
8280023.69-21646-73030-155830
8280023.69-20277-87464-170264
8280023.69-19308-102488-185288
8280023.69-18609-118057-200857
8280023.69-180810-134126-216926

 

the rough estimate for $82800 in credit cards at your blended interest rate of 23.69% apr requires pmt for nper number of years. that is 40%+ of your take home for years to come, equal or more than your mortgage. anything beyond 5-6 years is unconscionable. at 7 years more cumipmt interest is paid than the original balance.

 

sure you can throw more cash at it and/or lower the apr at some point to help with the interest, but it needs to be really significant.

 

upgrade
9/2022
$30000
nfcu
8/2020
$20000
nfcu
12/2018
$30000
bofa
8/2016
$30000
citi
3/2016
$21000
discover
5/2014
$20000
chase
10/2007
$8900
Message 8 of 14
Debtdebt
New Member

Re: Debt Consolidation- Please Help!!

Tried looking at discover and Marcus loans but was denied due to:

-Proportion of balances to credit limits on bank/national revolving or other revolving accounts is too high
-Amount owed on revolving accounts is too high
-Length of time accounts have been established

 

 

 

Message 9 of 14
FireMedic1
Community Leader
Mega Contributor

Re: Debt Consolidation- Please Help!!

Any equity in the home? HELOC possibly. I've never said yes file BK. The biggest investment is a home. Credit cards are not. Were do you see yourself in say 3-5yrs after filing for BK. Fresh start and rebuilding. Or. Still paying on these debts and interest is flying out the window. Money lost. Never recovered. Choice is yours. Best of luck.


Message 10 of 14
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