At a complete loss

iVillage Member
Registered: 03-27-2003
At a complete loss
3
Fri, 08-10-2007 - 11:43pm

I'm sure you've all heard this before but any advice you can give me would be greatly appreciated. I have found myself in the biggest mess I can imagine. And I feel so ashamed for getting myself where I am. Anyway, here are the details:

I have three credit cards, totalling approximately $30,000. One card, a business LOC, has now been sent to a CA (Allied Interstate, does anyone have experience with them?) and I have until the end of the month to pay the balance in full. If I don't I have no idea what happens. I'm assuming it's very bad though.

One of the other cards has a past due amount but I've managed to keep that out of collections but am getting nowhere in bringing down the balance. Same goes for the second card.

I actually make decent money - about $65k per year. THe problem is it's variable income (I'm in sales and earn commissions) and in down months I used credit to supplement my income. Obviously, it got away from me and I need to do much better budgeting. I have a mortgage but no car payment. In the last 6 months, I've learned to be much more frugile and have not added to my balances except through late fees, etc.

I've called the cc companies to see about interest rates (which are in the high 20s, if not 30s by now) and they won't negotiate because I've been consistently late on them, and honestly, I can't say I blame them. One question I have is - can I even apply for a credit card balance transfer if my current accounts are delinquent? I don't want to go through the process of applying only to be denied and end up my hurting my credit score even more. Also, usually how much will they let you transfer IF I am approved? And lastly, what are some fine print details that I should be aware of?

I have also considered a debt couseling service but am wary of that too because I don't want to hurt my credit even more than I already have. However, perhaps it's my only option?

I do have about $20k in IRAs but I know that if I cash them out I'll only be left with about half that after taxes and penalties so that doesn't seem worth it. However, I wonder if I just get rid of one card if it will help with some of the stress that's been caused by all my stupidity.

I literally can't sleep at night and feel like I'm having panic attacks. ANY advice or recommendations would be very much appreciated. Thanks for "listening."

iVillage Member
Registered: 09-12-2005
In reply to: r38016
Sat, 08-11-2007 - 2:00pm

The first thing that comes to my mind is your credit cards up and don't use them anymore. I honestly think that you should put them out of your mind, especially the thoughts you're having about borrowing from peter to pay paul It doesn't work.

Give the collection agency a call to work out payment arrangements. As long as you pay what you tell them you will, then you will keep them at bay. They always threaten that the world is going to end if it isn't paid in full right away. Give them a call, because having "no idea what happens" is going to drive you nuts. At least then you'll know that they can't take your blood or your children or something. Those people can be relentless though, so make sure that you chat with one of the experts here to find out exactly what you should be asking, and what information you should be requesting. I'm in Canada, so things might be slightly different here.

Again, I'm no expert, just a prairie girl in Canada who is in debt myself.....and I'm not a judgy person (about this anyway), but it kind of bugs me that you would refer to your mistakes as your "stupidity". We all make the wrong choices sometimes. I believe that choices can only be stupid, if the consequences are dealt with stupidly. And the choice to talk about it and try to get help now is brave, intelligent, and you deserve a pat on the back....if not a huge hug.

Sarah

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iVillage Member
Registered: 03-27-2003
In reply to: r38016
Sat, 08-11-2007 - 8:23pm

Hi Sarah,

Thanks for the kind words and encouragement. It means a lot! My cards are all "put away" - I learned somewhere to put them in a bowl of water and freeze it. That way, if I ever want to use them I have go home first and let it dethaw then go back to wherever I was going to use them. Needless to say, I have yet to do that.

iVillage Member
Registered: 07-24-2007
In reply to: r38016
Wed, 08-15-2007 - 6:30am
Welcome (unfortunately) to the board. DO NOT take money out of your retirement account for this. That's one of the worst things you could do to work on this debt.