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My husband and I have about $50,000 in credit card debt and we are having a hard time paying it down. What would be the best plan to eliminate the debt, that won't have a huge impact on our credit?




If you can afford the payment a debt management Plan or dmp might be a good option.With estimated 50k in debt your monthly payment would be around $1500-$1750 a month "which is probably close to around what you are paying now "

This plan is administered by a consumer credit counseling agency.Credit counseling is for people who are not overextended and thus can afford their minimum payments and just need one payment with a lower interest rate. Credit Counseling agencies will be able to negotiate with all creditors to accept a lower interest rate " usually around 6%-10%", waive late fees and over limit fees and spread your payments out over 5 to 7 years. You will repay 100% of your current balance with a payment that typically runs about 3% to 4% of your total debt. If you have the ability to repay the full debt you borrowed you should do a Debt Management Plan. This program doesn`t hurt your FICO score but will show on your credit report you are in a program to keep you from getting more credit until you complete the program. Once you complete the program it comes off your report as if you were never in the program. This site offers free counseling so why not call 800-601-1579

Sub: #1 posted on Thu, 07/03/2008 - 23:47

mobile0311 mobile0311
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(Posts: 1817 | Credits: 104.57)

Kendra,

The best possible way to pay this debt off is to request a home equity loan if you have one. Cash in pension plan money, get loans from friends and family, avoid becoming late on your payments. If you are already late the same information as above will apply only now you need to obtain settlement agreements on your accounts via negotiation.

If you owe 50k and cant keep up with your payments a dmp or settlement plan is not good for you. A DMP or debt settlement program will only get you deeper in debt. Negotiate settlements only if you are sure you will have about 50% of the total debt on hand in a time span of four to six months afetr you stop making payments on your accounts.

You can join a DMP, best would be to consolidtae all your bills if they are still current. Debt settlement will help you settle some accounts but not all, there is no way you and your husband can settle all accounts when the interest rates go up and late fees are being added top your accounts.

Consolidat if accounts are current, if not speak to a lawyer first and assess your situation. Good luck.

Sub: #2 posted on Sat, 07/05/2008 - 01:30

pemperandgartle pemperandgartle

(Posts: 57 | Credits: 9.16)

Actually, most experts say that you should never convert unsecured debt to secured debt, which is what you would be doing by taking out a home equity loan. They also don't advise using your pension money to pay off debt. I've done both, but now I just have a higher house payment that's hard to afford, and no pension money for when I retire!

Are you current in your payments or are they late? What are your current interest rates like? Mobile's advice above is good, unless you want to try to do it yourself, assuming that you are current on your payments.

There are two schools of thought regarding paying down debt on your own. One way would be to start with your highest interest rate account and pay as much as possible on it each month, while paying minimum payments on everything else. Once that account is paid off, then apply the amount you were paying on that account to the next highest interest rate account until it's paid off, etc.

The second school of thought is basically the same except that you start with your lowest balance account first and then move to the next lowest balance account. That way, you might see progress more quickly than by starting with the highest interest rate account.

Good luck!

Sub: #3 posted on Sat, 07/05/2008 - 02:36

alias1958 alias1958

(Posts: 1230 | Credits: 79.88)

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