Credit Counseling/debt Consolidation......need Some Advice.

Lounge By CakeDiva73 Updated 8 Apr 2010 , 8:01am by cakeladyatLA

CakeDiva73 Posted 29 Aug 2007 , 3:59pm
post #1 of 23

I will try to 'long-story-short' this one....... my husband and I have been sep. for 18 months and we are getting back together (yeah!). We have 4 children so this is good......unfortunately, during these 18 months, he spent like a mad-man and is 25K in credit card debt. He checked into debt consolidation and seemed excited by what he heard. I, on the other hand, heard that they are a bit of a scam, can ruin your credit and are basically too good to be true.

Does anyone have experience with this? We were going to try and pay the minumums and put and extra $1000 per month toward the debt but I have no idea how to figure interest in such a way to determine how long it will take and how much it will cost to compare to what the consolidation people offered. ( DH said we owed $35k - I think he overestimated....good God!! I HOPE he overestimated... anyway, and the credit people said we could pay them $951 per month for 52 months plus $35 per month, as a fee, costing a total of approx. $52k)

So my question is, do we do it? Is that accurate? Should we just live off pb & j and ramen for the next year and pay it down ourselves? Should we try to get a 'second' on the house to pay it?

P.S. Becuase we were late a couple of times, our interest rates are astronomical....like 30%. I called one to try and negotiate a lower rate and they said no way...so how do the debt people get rates down to 6% or 9% like they told him?

Sorry for the novel but I am flipping out....thanks icon_smile.gif

22 replies
cakebabe Posted 29 Aug 2007 , 4:16pm
post #2 of 23

I'll send you a PM

CakeDiva73 Posted 29 Aug 2007 , 4:19pm
post #3 of 23
Quote:
Originally Posted by cakebabe

I'll send you a PM




thank you...... icon_redface.gif I appreciate it.

susies1955 Posted 29 Aug 2007 , 4:46pm
post #4 of 23

Cakebabe,
Can you PM me with the info too. My son and wife are involved with CCC and they do weird things in my mind. Are they ok really?
Susie

itsmylife Posted 29 Aug 2007 , 11:08pm
post #5 of 23

Not sure if this will help you at all.... but our local news did a story recently about what to say to try to get your credit card interest rate lowered. Here is the link:

www.abcactionnews.com/content/segments/cfa/story.aspx?content_id=e2989ee3-8838-48c7-8d80-66e68bef9726

It's not much... but for people like me (I tend to get walked on, and when someone says no, I usually just accept it).. it might help to have it scripted out like this. I guess it comes down to being a little pushy with them.

HTH!
Denise

indydebi Posted 29 Aug 2007 , 11:37pm
post #6 of 23

PLEASE visit www.daveramsey.com!!!! He is a very common sense guy re: financials! I consider him a GOD in the field of financial advice. Invest the 20 bucks for his book. It will turn you around.

I've heard good things about CCC and i've heard how it's ruined people.

One person I know says his company will not work with credit counseling companies .... they will not take reduced payments, reduced rates, nothing, from a CCC.

I have never worked with a CCC, so I am by no means an expert.

But read Dave Ramsey. Please.

wgoat5 Posted 30 Aug 2007 , 11:23am
post #7 of 23

Please becareful...My MIL after my fil passed started doing one of these so called debt consolitdation things where they take a one time payment and split it between your creditors...I knew that just a few months ago (when we were still talking ) that she was still getting phone calls from the creditors AND she is still paying on the 3 cards!!!!!!!!!!! And it's been 5 years...she had debt of about 5000.00! She pays them 300 and something dollars a month!!! Sounded weird to me but you can't tell my MIL ANYTHING without getting the speech about knowing it all! Just be very careful!

Christi

darandon Posted 30 Aug 2007 , 12:50pm
post #8 of 23

I worked with a reputable counceling service when we had some issues in the past. Make sure you aren't paying a fee to them. Check with the BBB before signing anything. Make sure you do your homework before anything. Also, make sure they teach you how to take care of your credit in the future. Ours was wonderful. They worked out payment arragnements with the CC companies, reduced or even got them to stop the interest that kept piling up.
Just remember, if it sounds too good to be true, IT IS!.

cakes-r-us Posted 30 Aug 2007 , 4:07pm
post #9 of 23

Creditors do not have to accept ccc payments. Going through them still make your credit look bad. You should pay them down on your own, putting more on the one with the highest interest rate, but making sure to pay on time each month. Start showing on-time payments consistently. If you can't pay more, always pay the minimum and on time, even if it goes all to interest, you paid on time. If you keep doing this your credit score will improve and you can negotiate your interest rates.


If your credit is already bad, no one is going to lower your interest rate.

You may be able to have the interest stopped and pay off your balances on credit cards/loans. Stay in touch with your creditors, and always play nice.

Credit and collections is my area of expertise for the past 30 years and the only way to better your credit is to pay your bills on time.

Oh yeah, and all credit repair services do is bombard creditors with letters of explanations and calender for responses within 30 days, if none is received it should be taken off your credit report. This you can do yourself if you want to go that route. Its time consuming but so is trying to make your credit good again.

Mencked Posted 30 Aug 2007 , 7:38pm
post #10 of 23

[quote="indydebi"]PLEASE visit www.daveramsey.com!!!! He is a very common sense guy re: financials! I consider him a GOD in the field of financial advice. Invest the 20 bucks for his book. It will turn you around.

Please, please check out Dave Ramsey--His philosophy on money will turn you and your husband's lives around. Attending a live event will make even more of a mark on your determination to get out of debt and you can listen to some of his radio shows from his website--Best of luck to you. It really works!

lardbutt Posted 30 Aug 2007 , 7:48pm
post #11 of 23
Quote:
Originally Posted by indydebi

PLEASE visit www.daveramsey.com!!!! He is a very common sense guy re: financials! I consider him a GOD in the field of financial advice. Invest the 20 bucks for his book. It will turn you around.

I've heard good things about CCC and i've heard how it's ruined people.

One person I know says his company will not work with credit counseling companies .... they will not take reduced payments, reduced rates, nothing, from a CCC.

I have never worked with a CCC, so I am by no means an expert.

But read Dave Ramsey. Please.




I was going to respond with the same advise..........DAVE RAMSEY! My hubby and I are about to seek financial couseling from our church. They use Dave Ramsey's resourses. I have heard so many good things about his approach. I am looking forward to putting into practice the principles he uses. I know alot of people you have changed their lives with his advise.

Good luck to you and congrats and getting back together with your spouse. I wish you the best! thumbs_up.gif

cakemomne Posted 30 Aug 2007 , 11:24pm
post #12 of 23

One more on the Dave Ramsey band wagon!! He may not tell you what you want to hear but he will tell you the TRUTH! Also www.crown.org offers some great resources for getting out of debt and for budgeting rather than just keeping track of what you have already spent.

Good Luck

kbochick Posted 30 Aug 2007 , 11:58pm
post #13 of 23

My DH worked with somebody who later tried to get a job with a top secret clearance. They had no problem with the fact that he had declared bankruptcy at one point, but they wouldn't give him a clearance because he had used a credit counseling company. I don't know anything about them personally, but that's what my DH told me.

We're having financial problems, too. We're watching every penny that comes in and goes out for a month, and then we're going to go talk to a reputable financial counselor.

indydebi Posted 31 Aug 2007 , 12:13am
post #14 of 23

what like about Dave is his common sense approach. A lot of "experts" tell you to double up payments on the highest interest rate credit card. The problem is if you can't even make the minimum payment , how are you going to make DOUBLE Payments????

Dave tells you to pay off the lowest balance account first. He says it's like losing weight.....if you go on a diet and dont' lose any weight, you are discouraged and you quit. But if you lose 5 lbs the first week, you are now double-motivated. Paying OFF that little $300 balance is like losing that first 5 lbs. You feel like you're making progress!

I've heard people call into his show that followed his program and they have paid off $30,000 and more in debt in less than 2 years. I heard one young couple (younger than 30) who had paid all their bills and owned their $160,000 house free and clear. It's DO-ABLE!!!!

kbochick Posted 31 Aug 2007 , 12:51am
post #15 of 23

OK, so I checked out that guy's website, and it looks really good. Does anybody subscribe to the Total Money Makeover thing? Is it worth it? I'm going to do the free trial, but just thought I'd ask some real people.

cakemomne Posted 31 Aug 2007 , 1:39am
post #16 of 23

I don't use his software, but I have read his book, and the system we use is based on the same principles. DH and I were clueless at best about money when we got married but now we have not carried credit card debt in at least 5 years, pay extra on our mortgage, own two of our 3 vehicles (will own the third in about a year), and manage to invest and add to savings pretty regularly. We are not perfect, we would love to build our savings more quickly and we need more life insurance, but I know the steps we took have allowed me to stay home with our kids eventhough we lost ~60% of our income when I quit my job. We used to do a lot of nonessential spending (and it was fun icon_lol.gif ) but I truly think we are way better off now!!

indydebi Posted 31 Aug 2007 , 1:53am
post #17 of 23

I bought the book (at Sam's .... lower price! Dave would be proud of me!) and you can get a LOT of good advice just from this.

He's coming to Indy (Nov, I think) and I would LUV to go, but I've no idea how I would fit it in the schedule. I should take the attitude that I can't afford NOT to!

tirby Posted 29 Mar 2010 , 2:43pm
post #18 of 23
Quote:
Originally Posted by kbochick

OK, so I checked out that guy's website, and it looks really good. Does anybody subscribe to the Total Money Makeover thing? Is it worth it? I'm going to do the free trial, but just thought I'd ask some real people.




My husband and I are doing our Total Money Makeover. I also did the free trial... But Paying for the subscription was not in the budget. We are well on our way into Babystep 2 and will be debt free except the house in less than 1 year. Is it (subscription)worth it, yes. Is it a necessity,no.
We now talk to and help a number of people wh are wanting to change their lives. for me, I'm a nerd I love to budget. Before I had to to survive so I know how. Now it is so I can live with financial peace... Any thing I can help with just let me know. one thing I will tell you is STAY away from people who are nay sayers, or who drag you down. You need straight answers, not people who want to apease you. feel free to PM me if you want.

indydebi Posted 29 Mar 2010 , 5:09pm
post #19 of 23

Right along with what tirby said is that I also stay away from people *IN* the financial world. Their JOB is to SELL you a loan. If they don't make loans, they aren't in business. If you aren't in debt, they don't have a job. They have a vested interest to keep you in debt.

tirby Posted 29 Mar 2010 , 5:14pm
post #20 of 23
Quote:
Originally Posted by indydebi

Right along with what tirby said is that I also stay away from people *IN* the financial world. Their JOB is to SELL you a loan. If they don't make loans, they aren't in business. If you aren't in debt, they don't have a job. They have a vested interest to keep you in debt.





You hit the nail on the head!!!!!

smokeysmokerton Posted 3 Apr 2010 , 11:53am
post #21 of 23

Another Dave Ramsey lover here! The best thing about him is that what he says isn't complicated. It's really all common sense stuff that we overlook everyday, like, taking cash out of the atm before going to the grocery instead of using your debit card, or paying your "necessary" expenses before anything else. When I first got married, hubby and I would pay all of our bills up front and then literally have to scrounge for money to buy groceries and gas. We learned that food, gas, and utilities come first, and we found that if we really paid attention to what we were spending and set a budget for EVERYTHING, we had more money than we thought we did. I must admit that sometimes I get a little lazy(around that time of the month because I'm too tired to think!), and use my debit card for everything, my money disappears. It's like POOF! Where'd all my money go?

cheatize Posted 8 Apr 2010 , 5:00am
post #22 of 23

If available, you may be able to save some money by borrowing the book from the library instead of purchasing it.

Yeah, I'm a real cheap-o at times. icon_smile.gif

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