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braisler · 04-19-2007, 07:19 AM

The very first thing that you should do is to call the credit card company and get your interest rate reduced or eliminated. It is not hard to get it cut in half or more. If you work at it, you can get it reduced to zero. That should cut your payment substantially. You must do this first. Start with the first customer service person you talk to. Explain that you are paying down your balance but the interest rate is simply too high. You have another offer from a competing credit card that will give you 0% interest on balance transfers for the next 6 months if you switch to them (there are lots of offers like this out there, you don't have to actually have one in hand). Ask if they can match this rate. Then wait. Usually the first CSR you talk to won't have the authority to lower your rate, or at least not substantially. You will probably have to go through the whole story with their supervisor.

Don't threaten to close the account, just stress that you want to pay the amount off, but have a better interest rate offer elsewhere. Whatever, you do, don't close the account before you have it paid off. This goes directly to collections and there is no more negotiation.

For the IRA issue, depending on the amount that you have in the IRA currently, you may be able to get a loan on the balance which is lower interest rate than your credit cards. If you cash it out (bad idea, maybe the worst, last resort) you will have the 10% fee and then have to deal with it as income just like you said.

A $3000 balance is really not all that bad. You started your new job, so hopefully you've got a good income coming in. Take a good long look at your finances and cut out the 'extras' that you may not really need. Cancel your (and your partners?) cell phones if you can. Do you REALLY need them? Probably not. That alone can be 700-1000 per year. What about cable television? That is another 'essential' that you can really do without pretty easily. In most areas, that's another $600-700 per year. Look around at what you spend your money on and what can be cut down for the few months it takes to get this debt paid off.

Best of luck resolving this for yourself and your family.

04-19-2007, 07:19 AM	#2 (permalink)
braisler Addict Location: Midway, KY	The very first thing that you should do is to call the credit card company and get your interest rate reduced or eliminated. It is not hard to get it cut in half or more. If you work at it, you can get it reduced to zero. That should cut your payment substantially. You must do this first. Start with the first customer service person you talk to. Explain that you are paying down your balance but the interest rate is simply too high. You have another offer from a competing credit card that will give you 0% interest on balance transfers for the next 6 months if you switch to them (there are lots of offers like this out there, you don't have to actually have one in hand). Ask if they can match this rate. Then wait. Usually the first CSR you talk to won't have the authority to lower your rate, or at least not substantially. You will probably have to go through the whole story with their supervisor. Don't threaten to close the account, just stress that you want to pay the amount off, but have a better interest rate offer elsewhere. Whatever, you do, don't close the account before you have it paid off. This goes directly to collections and there is no more negotiation. For the IRA issue, depending on the amount that you have in the IRA currently, you may be able to get a loan on the balance which is lower interest rate than your credit cards. If you cash it out (bad idea, maybe the worst, last resort) you will have the 10% fee and then have to deal with it as income just like you said. A $3000 balance is really not all that bad. You started your new job, so hopefully you've got a good income coming in. Take a good long look at your finances and cut out the 'extras' that you may not really need. Cancel your (and your partners?) cell phones if you can. Do you REALLY need them? Probably not. That alone can be 700-1000 per year. What about cable television? That is another 'essential' that you can really do without pretty easily. In most areas, that's another $600-700 per year. Look around at what you spend your money on and what can be cut down for the few months it takes to get this debt paid off. Best of luck resolving this for yourself and your family. __________________ --- You do not really understand something unless you can explain it to your grandmother. - Albert Einstein ---