Better plan?

iVillage Member
Registered: 11-06-2007
Better plan?
7
Fri, 06-13-2008 - 1:59pm

I

iVillage Member
Registered: 11-17-2007
In reply to: nomoredenial
Fri, 06-13-2008 - 4:08pm

I am confused here. Did you buy with this 90.000 a 1000. pair of shoes and a mink coat or did you pay to have two beautiful kids that are healthy.


If it was for the children, then if I remember right there is a plastic cup and a few dirty movies in the mix somewhere. So why are you so afraid.

iVillage Member
Registered: 11-06-2007
In reply to: nomoredenial
Fri, 06-13-2008 - 4:41pm

My head is hurting from all the math here.

iVillage Member
Registered: 11-17-2007
In reply to: nomoredenial
Fri, 06-13-2008 - 4:53pm
sorry I could not help my helc was 1% of the balance It was 5 points over prime That is why I said that. And you could add to it without paying a fee. So a little at a time you could row over the other higher balances and the 2% payment.
Avatar for endomagazine
iVillage Member
Registered: 11-09-2004
In reply to: nomoredenial
Mon, 06-16-2008 - 2:40am

Hello,

After discussing the amount of debt (including the loans) that you have with your husband, I think the important part of dealing with this debt is to slowly pay them off by budgeting and living on less than your income.

Taking out a home equity loan or a second mortgage isn't going to pay off the debt. It only transfers it to mortgage debt. That kind of debt is more dangerous (as a second mortgage) because your home value is not static. It can go up and down, possibly exposing you to risk if the home value sinks below the total mortgages owed.

I would suggest that you do *not* transfer your loans or credit card debt to a mortgage. You mentioned that you are current with the credit cards, loan minimums, bills, etc. So the real issue isn't the need to lower your payments. The real issue is going through your finances and paying down the debt, smallest to largest.

Getting a second mortgage to pay off this old medical debt (which is what it is..) is a bad idea. Don't do it.

List your debts smallest to largest, pay the minimum balance on everything but the smallest debt. Set aside a $1000 emergency fund, set up a budget, then start sending any extra income that isn't spent on necessities and bills, to the smallest debt.

Edward Jones $2000
Capitol One: $6725
Shell/Citi: $7500
Chase: $11700
Providian: $16000
Loan 1: $19000
Loan 2: $29000

Above, I've listed your debts smallest to largest. Call the credit card companies and ask them to lower your interest rate. Don't worry about balance transfers, just call them and ask. Most credit card companies will lower your interest rate a few points every time you ask, just because you called. This will save you some money on minimum payments.

You haven't posted your budget, but I'm pretty sure that if you are making the minimum payments, that you can send a little extra to the Edward Jones card to pay it off. Then, you'll have one credit card paid off. Cancel the card, then start sending extra to the Capital One card. As you pay off credit cards, the number of minimum payments you'll have to pay will go down, and as the balance goes down, the minimum payment also goes down.

If you took out a signature loan, the minimum payment wouldn't change even if you paid extra on the balance. If you took out a second mortgage, the minimum payment doesn't change when you pay extra on the balance. You're stuck with the same payment until it's paid off. Leaving the balances on your credit cards (as long as you're current) will mean that slowly, over time, your minimum payments will be reduced as the balances are paid down. This makes it easier to *keep* paying extra on the smallest debt.

Sincerely,
Lindsey Schocke


Geeks on Tap: Mission Accomplished

Sincerely,
Lindsey Schocke

Geeks on Tap: Mission Accomplished

iVillage Member
Registered: 11-17-2007
In reply to: nomoredenial
Mon, 06-16-2008 - 6:37am

This was sent to me by mistake I think it is for you.

from:
endomagazine Member Icon
to:
kymaiden40215
date:
2:40 am
replies:
5

Hello,

After discussing the amount of debt (including the loans) that you have with your husband, I think the important part of dealing with this debt is to slowly pay them off by budgeting and living on less than your income.

Taking out a home equity loan or a second mortgage isn't going to pay off the debt. It only transfers it to mortgage debt. That kind of debt is more dangerous (as a second mortgage) because your home value is not static. It can go up and down, possibly exposing you to risk if the home value sinks below the total mortgages owed.

I would suggest that you do *not* transfer your loans or credit card debt to a mortgage. You mentioned that you are current with the credit cards, loan minimums, bills, etc. So the real issue isn't the need to lower your payments. The real issue is going through your finances and paying down the debt, smallest to largest.

Getting a second mortgage to pay off this old medical debt (which is what it is..) is a bad idea. Don't do it.

List your debts smallest to largest, pay the minimum balance on everything but the smallest debt. Set aside a $1000 emergency fund, set up a budget, then start sending any extra income that isn't spent on necessities and bills, to the smallest debt.

Edward Jones $2000
Capitol One: $6725
Shell/Citi: $7500
Chase: $11700
Providian: $16000
Loan 1: $19000
Loan 2: $29000

Above, I've listed your debts smallest to largest. Call the credit card companies and ask them to lower your interest rate. Don't worry about balance transfers, just call them and ask. Most credit card companies will lower your interest rate a few points every time you ask, just because you called. This will save you some money on minimum payments.

You haven't posted your budget, but I'm pretty sure that if you are making the minimum payments, that you can send a little extra to the Edward Jones card to pay it off. Then, you'll have one credit card paid off. Cancel the card, then start sending extra to the Capital One card. As you pay off credit cards, the number of minimum payments you'll have to pay will go down, and as the balance goes down, the minimum payment also goes down.

If you took out a signature loan, the minimum payment wouldn't change even if you paid extra on the balance. If you took out a second mortgage, the minimum payment doesn't change when you pay extra on the balance. You're stuck with the same payment until it's paid off. Leaving the balances on your credit cards (as long as you're current) will mean that slowly, over time, your minimum payments will be reduced as the balances are paid down. This makes it easier to *keep* paying extra on the smallest debt.

Sincerely,
Lindsey Schocke

Geeks on Tap: Mission Accomplished

Avatar for cl_phocid
iVillage Member
Registered: 03-26-2003
In reply to: nomoredenial
Mon, 06-16-2008 - 10:33am

Hey Mary Ann - most of us just hit reply to the last message in a thread, so if you've got email turned on, you'll get a notification.

All my best,
Danni

iVillage Member
Registered: 11-06-2007
In reply to: nomoredenial
Mon, 06-16-2008 - 2:00pm

Thanks for the extra advice.