Ik.

[Anonymous]

Hi

[Anonymous]

You should have contacted your Lenders about some kind of payment agreement due to your sutuation, possibly deferment if job loss was Covid related. As for how to pay off the debt it depends greatly on how much available cash you have to pay on them and what you can cut from your expenses like coffees etc.  Probably will have to seek a second job if income is lower than it was before and you still were behind the eight ball.

Many people suggest the snowball method of paying off the smallest balance first, then work your way up from there to the next lowest balance and so on. Being as your credit has gone down hill BT's and Loans are likley out of the question.

I'm sure other members with more experience will pop in to advise

[OmarGB9]

As mentioned above, how much realistically do you have to put towards debts monthly? Can you cut out any unnecessary expenses (cable, cut down phone bill, entertainment, etc.)?

If you hadn't contacted your creditors and asked to be enrolled in hardship programs, I mean it really should've been done at the time, but if you haven't now is a good time. Hopefully they'll still allow it and possibly even retroactively remove lates.

[coreysw12]

Definitely the first thing you need to do is contact the 5 banks that you're behind on payments with. At the 6 month mark, they usually charge off the account, so this is URGENT, you need to do this, like, today. Explain your circumstances and hardship, and how you want to work with them to bring your accounts current and (hopefully) avoid a charge off. See what they have to offer. Do whatever you can to avoid them getting charged off.

Once you're caught back up, use either of these methods to work on paying them down:

1. Paying the minimum payments on everything, except for the highest-interest account which you'll pay as much as you can until it's paid off, then move on to the next one. (This method will minimize the interest you'll pay)
2. Paying the minimum payments on everything, except for the lowest balance account which you'll pay as much as you can until it's paid off, then move on to the next one. (This method reduces the number of banks you owe money to the fastest)

At the same time, you can use Good Will letters to try to hopefully get some of the lates removed from your credit reports. Good luck

[coreysw12]

I also want to note that you made a VERY smart move by keeping a handful of your accounts current. This will make rebuilding much, MUCH easier in the near future. You can completely skip over what I call the "secured card / predatory lender phase of rebuilding", which will save you years. Many people decide "well, my credit is already falling apart, so I might as well not pay anything", but you did not make that mistake. So kudos for that!

You won't be starting over with a clean slate, you'll be starting over with an already aged/thick credit file, which makes all the difference.

[SouthJamaica]

I agree with the sound advice you have been given by @coreysw12 and @OmarGB9 

[rostrow416]

Plenty of us have been there before.  You got plenty of good advice so far, so I just want to stress the fact you need to call those lenders ASAP.  Many will be willing to work with you. 

Try to get the smaller balances knocked out so that you have fewer payments going out.  Focus on working out payment plans, deferrals or whatever else you can get out of those lenders, but be realistic.  Make sure neccesities are covered, your credit can always be rebuilt.

Best of luck 

[CreditInspired]

---

@Anonymous wrote:

Hello everyone i'm not sure if i'm even posting in the correct section of this forum. I've been really stressed out lately because before covid-19 hit i was on my journey to rebuilding my credit at the time my credit was in the mid to high 600's and i was paying off 8 credit cards owing around 13k in cc debt, but then i lost my job and stopped paying 5 of those cards for about 2 months, then i found another job but i wasn't making nearly as much as i was making in my last job so i still couldn't afford to pay my credit cards because i was paying my car, utility bills, food etc.. so anyways it's been about 6 months that i haven't paid on 5 credit cards and my credit is basically ruined my middle score is 553. I've been thinking about debt consolidation but i heard bad things about those companies so i held back from that. Here's what my cc debt looks like broken down:

Apple CC

balance=$865.96 behind 6 months

Best Buy Visa

balance=$1145.68 behind 6 months

Amazon store card

balance=$1250.56 behind 6 months

Capital one platinum

balance:$1799.40 behind 6 months

Chase prime card

balance=$2702.56 behind 6 months

Citi Double Cash CC

balance=$427.74 current

Jared Comenity CC

balance=$712.58 current

Wells Fargo CC

balance=$6209.12 current

TOTAL=$15113.60

---

You didnt tell us your net income so it's kind of hard to offer advice on how/what to pay off. So, if in reality you can only pay the minimum payment, your balances will increase, not increase. 

So first, do you think realistically that your income will increase so that you can start knocking down these balances? If the answer is no, you might have to look into bankruptcy. Chapter 7 (liquidation) or Chapter 13 (repayment). 

I'm only providing another solution. 

GL2U