Will I ever make progress at this rate?

Avatar for cherfer
iVillage Member
Registered: 11-11-2003
Will I ever make progress at this rate?
8
Tue, 09-06-2005 - 12:12pm

The minimum payment on my card is $109 per month. The balance is about $5500. I've been paying $125, since I can't afford much more than that right now. The balance is only going down $30 per month! I've only paid $250 toward the principle since January! Argh! I feel like this debt will never go away. I can't get these jerks to lower my 20.99% interest rate, even though my credit has improved tremendously over the past two years. I guess it's becasue they know that I haven't charged on the card in years, and I'm just looking to pay it off. I feel like I wouldn't qualify for a high enough limit on a new lower rate card, that's why I haven't switched to something else.
I suppose the bonus I get in February will all go toward this debt instead of something fun. Sigh... and that still won't even cut it in half.

Feel like I'm not getting anywhere!

Cheryl

iVillage Member
Registered: 09-07-2003
Tue, 09-06-2005 - 2:13pm

If you have been making ontime payments since January, they should be getting willing to work with you. (Chase, for example, told me that they couldnt work with me until I had the card underlimit and had made on-time payments for 6 months.)

Its not easy....I called all my credit cards every monday night and asked the same questions and noted the answers and kept trying. sometimes I would offer a larger payment right then, if they would help me....EVERY time you call it is noted in your file and eventully you'll find a person who says "OK, I can see you are making an effort" and suddenly finds a way to work with you.

With MBNA, I was at 29%, and the minimum payment was more then one week's worth of pay AND was not effecting my $14K + balance AT ALL, in fact it was still going up because payments were slow. It took the full 3 months to get it to 14%, and I wasnt approved for the 14%, but the agent overrode that and I eventully was authorized for it, anyway, because I was "making an effort". THEN, on top of that, that final agent reimbursed all the late fees I had gotten for the past 4 months, when I was never sending enough $$ on time. so, a $156 credit to my account, which was handy. (I did have to agree to close the card to get the 14%, so that no new charges could be made. this locks in the 14%, as well, I know..but I also know that the debt consolidation companies I called told me MBNA would only fall to 15%...so the 14% was acceptable for me.)

On another card (and I got this idea FROM MBNA, actually), I called and asked them what debt consolidation company they recommended, because I wasn't able to make the minimums right now, so I needed to talk to someone about a payment plan or bankruptcy or something. The agent quickly offered to work with me. :D

Its free to talk to a debt consolidation company, and they'll tell you what your rate with them would be. (Chase was 6%, for example), and then you'll have a ball park of what the CC should be willing to do for you. (since you paying THEM 6% they'll make more $$ then you paying a debt consolidation co that 6%)

Also, of course, know that as your balance goes down, the interest totals will ALSO go down and the amount of each payment going toward the principal will naturally go up.

Hope some of those thoughts help,

~ Teresa

Teresa
http://www.affordingpickles.blogspot.com

Avatar for cherfer
iVillage Member
Registered: 11-11-2003
Tue, 09-06-2005 - 2:44pm

Thanks for the ideas. It's interesting because I haven't had a late payment in at least 5 years. I always paid this account on time ahead of everything else. So it's annoying that they won't work with me. And it is MBNA, if I didn't mention that.

Maybe I will call them tonight and try again... I'll use your idea about threatening to go to debt consolidation. ;-)

Thanks!
Cheryl

iVillage Member
Registered: 06-18-2004
Tue, 09-06-2005 - 3:51pm

Just a thought--you could get a lower rate card and "surf" part of your cc balance to it. I would keep the balance surfed to with in $100 or $200 of the balance on the new card not to the absolute maximum (you don't want to accidentally go over the limit with interest which will get you the default rate plus a whole bunch of other fees). Pay it off and keep surfing the balances to that card, pay the maximum you can on the new card, while paying the minimum on your old card. If you owe less, the cc might be willing to work with you on your interest rate.

Another idea would be to tell the company you were preapproved for a new cc with a different company and what can they do to compete with the offer. Just make sure you have that offer in hand, because the company can pull your credit report and find out if you have been extended in preapproved cc offers.

Good luck and it can be done.

Kellie

iVillage Member
Registered: 08-28-2004
Tue, 09-06-2005 - 4:54pm

Bankrate.com's credit card calculator says that you'll have it paid off in 7 years at that rate. Paying $150 a month will get it done in a little less than 5.

Have you gotten any credit card offers with lower rates that you can transfer the balance to? 21% interest stinks!

Avatar for cherfer
iVillage Member
Registered: 11-11-2003
Wed, 09-07-2005 - 8:17pm
No I haven't gotten any other offers... I've put a small portion of the balance onto my boyfriends' lower interest rate, he was nice enough to let me, but I still have the $5500 to deal with...
Avatar for cherfer
iVillage Member
Registered: 11-11-2003
Wed, 09-07-2005 - 8:32pm

HEY ALL!

IT PAYS TO CALL! They lowered my rate to 14.99%!! Every little bit helps!

Woo hoo!

Cheryl

iVillage Member
Registered: 09-07-2003
Wed, 09-07-2005 - 10:30pm

Congrats Cheryl!!!!

Its amazing what a bit of proactive-ness can do, sometimes. :D Glad you got an agent who would work with you. :)

~ Teresa

Teresa
http://www.affordingpickles.blogspot.com

Avatar for cherfer
iVillage Member
Registered: 11-11-2003
Wed, 09-14-2005 - 1:50pm

Thanks, it's just a small step, but it feels great. I also have a 0% balance transfer rate for one year, so I took 2 small cards and transferred them over. It's only $500 so that will definitely be paid off before one year is up, because the payments get applied to the 0% rate first. So now I have 2 small cards paid off, and put away for EMERGENCY use only.

I really hope I can get the rest of the $5500 out of way by next year, because then my student loan payments start. It was also my goal to be out of debt by age 30 and I will be 30 next year, so hopefully I can meet that goal!

Has anyone else here paid off that kind of balance in just one year? It seems impossible but I'm going to try my hardest!

Cheryl