What should I be paying first here?

[Taoron]

I was on track to break 700 a few years ago after filing for bankruptcy.  I decided to buy some furniture (bedroom set) because I had no furniture.. and I was paying it off until I lost the income I was using to pay it off in March of 2017.

I have 4 cards that I have had to use to stay afloat in the past year.. things are looking up as far as being able to stay afloat but I have done some damage and am unsure how to fix everything I have done.

I have some cards that were maxed out and are now going above their credit limit due to fees or not being able to keep with the payments.

I am not sure how to immediately fix this, as the money I would put towards paying it down that I get would just get used to pay bills anyway.

I need some help prioritizing what to pay back to stop the bleeding.  One is about 4-5 months past due, the other 3 have never been late.

1) Capital One, $4200  (Limit: $3500), seriously delinquent.

2) BCU, $6000 and hovering +/- $100 from there for the last year or so. (Limit: $6000)

3) BCU secured, $600 balance -- hovering at $600 for about the same time.  (Limit: $600)

4) Discover, $600 (Limit: $500)

A lot of these cards I have had since the time of discharge / 1 year after discharge. I ran into bad times because of job loss and I made the same mistake again. 

I have a seasonal job, making about $2000/month after taxes.

[FireMedic1]

Sorry about your situation. I would put more effort towards the cards that have no lates. The one with the lates, the damage is already done, You can call and ask for a hardship payment plan. Most CCC's will do that so they get paid back rather than closing the card and go thru all the collection stuff. Though you might be balance chased and they might close the card once its paid off if you dont talk to them. Give it a shot. Lastly. Cut them up and dont use them for anything until you get back on solid ground. Good Luck!

[Anonymous]

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@Taoron wrote:

I was on track to break 700 a few years ago after filing for bankruptcy.  I decided to buy some furniture (bedroom set) because I had no furniture.. and I was paying it off until I lost the income I was using to pay it off in March of 2017.

I have 4 cards that I have had to use to stay afloat in the past year.. things are looking up as far as being able to stay afloat but I have done some damage and am unsure how to fix everything I have done.

I have some cards that were maxed out and are now going above their credit limit due to fees or not being able to keep with the payments.

I am not sure how to immediately fix this, as the money I would put towards paying it down that I get would just get used to pay bills anyway.

I need some help prioritizing what to pay back to stop the bleeding.  One is about 4-5 months past due, the other 3 have never been late.

1) Capital One, $4200  (Limit: $3500), seriously delinquent.

2) BCU, $6000 and hovering +/- $100 from there for the last year or so. (Limit: $6000)

3) BCU secured, $600 balance -- hovering at $600 for about the same time.  (Limit: $600)

4) Discover, $600 (Limit: $500)

A lot of these cards I have had since the time of discharge / 1 year after discharge. I ran into bad times because of job loss and I made the same mistake again. 

I have a seasonal job, making about $2000/month after taxes.

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First thing I would do is call Capital 1 and explain to them that you want to work with them to keep the card open if it already has not been restricted. Explain the situation & see if they can work with you.

Second, you need to make a budget & write down EVERYTHING you spend your paycheck on. EVERYTHING, down to a cup of coffee. I was always winding up with more month than money before I committed to making a budget last July. Trust me, when you can visually see & track your spending, it makes a HUGE difference in getting back on track.

Second, you need to figure out a way to bring some extra income in. Whether it is selling some things you no longer truly need, or picking up a second job, driving for Uber or Lyft... something. You need to do something that can increase your cash flow to help you get out of debt. Use the extra income to get all your balances down. Remember, any balance above 88.9% is considered maxed out. Make short term goals- first, get all accounts under 88.9%, then shoot for all under 68.9%, then 48.9%, then 28.9%. Anything under 28.9% is ok in the eyes of creditors & FICO, but if you can get them under 8.9% you'll increase your score even more.

While you are creating this extra income, make sure you start paying yourself 5-10% each time you get paid- this is your savings & is not to be touched! Once you get your debt under control, continue building up your savings so that you have enough saved to pay off every credit card to $0 if you ever had to max them out again, although the goal is to NEVER max them out ever again. Keep putting as much into savings as possible, building up enough funds to support yourself when seasonal work is slow. It's not going to happen overnight, but it's a mindset that you have to change inside yourself to permanently stay out of debt. GL!