@Anonymous wrote:
The balances on the 5 open accounts are within $2,000 to $3,000 of the limit For Bank of America and American Express, each time I pay the accounts down by $3,000 they decrease the limit and cite other credit card balances as the reason for the decrease. I told each company that I felt I was being penalized for paying on time and more than the monthly payment, but no sympathy there!
I've thrown out the idea of spreading the debt among the other cards to get the balances down. Their response would be I have too many open accounts with balances, and I'm afraid they will reduce my limits even lower.
Thanks for your response.
I am sorry to hear of your plight.
Unfortunately there is no simple solution. If you are only paying (slightly) "more than the monthly payments", that is most likely the source of your problems.
The minimum payment due is not actually a "monthly" payment. The amount you have been paying is the minimum acceptable payment for that month to avoid delinquency.
To reassure a lender that you are not risky you should be making monthly payments significantly higher than the minimum due. If a person makes a minimum payment of $100 in one month while at the same time charging another $100 of purchases the lender sees no effort being made to reduce the overall debt.
This wasn't so bad when the lenders had lots of money and relatively few defaults. The lenders are focusing on avoiding defaults now.
To get the lenders to lighten up on you, you have to find a way to make serious balance reductions across all tradelines.
If any lenders are not chasing your balances down with CLDs I would consider paying that lender as much extra as possible to get your overall utility headed back up.
If you can get any lender to convert your outstanding balance to an installment loan that might help. You could ask for your existing revolving credit card to be allowed to remain open with a very low credit limit to use for monthly expenses while paying it in full every month.
The main thing to consider is that lenders would like to see your balances going down significantly right now. Paying the *minimum due plus the *monthly interest on the whole balance, plus the *current months charges would be the rule of thumb I would use. Of course if the money isn't available the pain will be significant.
If you can't make some significant progress now, it will be much harder when the new laws go into effect.
If you care to post actual balances, credit limits, interest rates and minimum payments due, possibly there might be a game plan or two that some of us might recommend.
Of course the most important number is what is the most that you can possibly pay towards all of the balances each month? That amount is not including the funds you need for all your normal monthly expenses.
