Paying off all credit cards in full at once...?

[kovacs32]

So my plan to get debt free hasnt been going so well. Pondering the idea of just getting a sing loan from my CU and paying all my cards off at once. then just paying one monthly payment that would have me debt free in 3 years vs. like 10 years and much more money. Will this obliterate my already un stable credit?

 

[CamaroKid91Z]

I have been trying to do the same thing. All I can say is good luck. I was going to refinance my truck through my CU a a MUCH high interest tate, but have all my credit cards and debts paid off. Sill couldn't do it. My understanding is banks are not really willing to loan money out right now, so i can be difficult to get a loan. If you can, by all means get a loan and pay them bad boys off!

 

[ASRoff]

snowball the debt. Pay the minimum on all cards except the one with the lowest balance. dump as much money at that one card as you can. once its payed off. get rid of it and pay down the next lowest balance. you only need ONE credit card.

Get out from the debt monster.. your country may be addicted to Debt. but you dont have 2 be. It can be done WITHOUT a loan I can attest to it! did it back when i was 26 and NEVER looked back

 

[that national]

you have a 401k you can take a loan from?

 

[streetracinflint]

if u get loan make sure u cut them damn things up and not get anymore

 

[soap]

you have a 401k you can take a loan from?

That is terrible advice.

--Joe

 

[Rumblestrip]

you have a 401k you can take a loan from?

Financially that is one of the worst things you can do. The whole "you're borrowing money from yourself" is bullshit. I say this as someone who was a financial advisor for 7 years and had a ChFC

 

[beertestr]

So my plan to get debt free hasnt been going so well. Pondering the idea of just getting a sing loan from my CU and paying all my cards off at once. then just paying one monthly payment that would have me debt free in 3 years vs. like 10 years and much more money. Will this obliterate my already un stable credit?

Define obliterate? Do you mean make your credit worse or make it better? Anything you do to pay down your debts ahead of time is good for your credit rating.

Anybody remember the good ol days when you can bounce your debt from 0% interest card to another 0% interest card?
I paid off all my student loans that way. I would bounce the balance to 1 credit card until the 0 percent interest free rate was almost up, open another card and do another balance transfer. That worked really well till about 2003, when they started charging balance transfer fees which were sometimes still a good deal. I paid off close to $15k at 0 percent interest.

Then, when short term CDs were paying decent I'd open them up by writing. balance transfer checks and then cashing in the CD before the introductory rate expired. They were only paying a few percent, but I was not using any of my own money.

Ahh, the good old days.

To the OP, a consolidation loan will usuallt get your debt to a more manageable interest rate. The pitfall is that you have done nothing abiut budgeting to keep yourself from doing it all over again or worse. Do a variation of the snowball technique. Figure out what debt is costing you the most per month in interest. Setting up a simple spreadsheet in Excel is pretty easy. See what the monthly interest is on each of your debts and go after the highest one each month. If you get close to closing out debt out tackle it and clear history it. This gives you a real eye opener to where your money is going.
Also, try to closely track where your money is going. There are tons of phone apps for this now. If you belong to a CU, see if their online banking has a budget tracker. It basically does the same thing as quickbooks, the one my wife and I use is pretty slick and generates a monthly chart where your money is going. It only takes a few hours to get set up and we check our expenses every month. It really illustrated where we were wasting money. We knew we were eating out more than we should but when we saw the monthly total..... wow.. I brown bag to work a lot more now.

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[Stalker]

Depending on the debt load I would recommend it. Especially if you have shaky credit and have been trying to play the 0% interest shell game. I did that for a while a few years ago. I wrapped up about 20k in credit cards with the U of M credit union and paid ~400 a month for about 4 years. Paid it off in much faster time than any credit card would have been paid off otherwise.

 

[04GoaT]

That is terrible advice.

--Joe

Yea, but this thread I'd full of bad decisions already.

My suggestion is easy, if you can't afford it, don't buy it. Or in this case don't bet it either.

 

[beertestr]

That is terrible advice.

--Joe

X2. You should only do that if you have absolutely no other choice.

If anything see if your work lets you withhold after tax pay. Use that to stash money if you are bad with cards. I do 3%/pay into a cadh management account. When my lease is up on my current truck in 2 years, I'll have a decent definition own payment on my next ride. The money you withhold is sort of out of sight out of mind and you are stashing it. If yoh are covering bills and get a raise, try stuffing the extra your getting away. You got by without it before, right?

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[beertestr]

My understanding is banks are not really willing to loan money out right now, so i can be difficult to get a loan. If you can, by all means get a loan and pay them bad boys off!

Correction, banks are conservative with the level of risk they are willing to take.

Limit your unsecured debt.... aka credit card limits. As you pay down your cards call and lower your limit. Unsecured debt goes against what banks and CU's are willing to lend you.

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[lethalss]

No matter the balance, always pay the one with the highest APR first, then snowball it if the rest are the same.

 

[ASRoff]

That is terrible advice.

--Joe

I borrow from my 401K all the time.......... to buy more mutual funds, Gold and silver

 

[mdhmi]

Can't believe no one told you how to really get out of debt. EARN MORE MONEY!

 

[Beigg]

Sperm/plasma bank, panhandle, hock your TV, sell pet rocks, beg Petter to pay Paul, advance cash, welfare..


Jk

 

[kovacs32]

Depending on the debt load I would recommend it. Especially if you have shaky credit and have been trying to play the 0% interest shell game. I did that for a while a few years ago. I wrapped up about 20k in credit cards with the U of M credit union and paid ~400 a month for about 4 years. Paid it off in much faster time than any credit card would have been paid off otherwise.

Thanks, I'm looking at about 10k to get out from all lenders. It would be a huge weight off my shoulders to consolidate and finally get on top of this. I been trying like hell for over a year to pay them down but after my wife lost her job and I got some big medical bills I just fell right back behind. Once done with this debt I will have one single CC through my credit union and it will have a $1k limit.

 

[347convert]

About 5 or 6 years ago I used to have a credit card. I rang up about $10k in debt over time, big purchases. I paid it off by just straight having it as my number 1 priority only. It didnt take very long either.

Id buy and sell a car, put that on the bill..
I had a goal every month of what I needed to sell on ebay and put that on the bill...
I made sure I paid a set percent out of every check on the bill and then learned to live on less money.... If you pay it when you get paid its alot easier then paying $500 when the bill comes.
Start mowing lawns at $20 a crack on your day off just to pay on your bill down. It all depends how bad you want it.

its not hard to make $100.00 I don't feel why people think its hard to do that 100 times....

The only 3 cards I use are best buy, home depot, and ABC, And I never pay interest.

 

[MentalMisfit]

I won't own a credit card again i can't trust myself with them I am horrible with them.
I ended up having to goto one of those debt consolidation places. They did save me money on a few cards though i owed about 9k on it and they settled it for 4k. I stopped paying my cards and then would send money to the debt consolidation place every week. They would handle the creditors for me. My credit took a hit but there was no way i could afford to keep paying $400 a month in just interest. I now only have discover card left to pay they are bastards and dont settle for anything so if you have a discover card get rid of it or pay it down first lol. If it is real bad you kind of just have to let your credit take the hit and get out from under it. They made a payment plan i could actually work with and its taken a few years but i will be done in a couple months. I could of been done much sooner but I need to have some type of life lol. I lost my job and was late just a couple times and all my interest rates jumped to above 22%. And damn discover card kept lowering my limit to exactly what i owed them and then would hit me with an overdraft fee every month when they added the interest to it.

In short credit cards are the devil and I will never own one again I just keep a small emergency fund now.

 

[slideways]

I have been working on this myself, had around 12,000 of unsecured debts. Have been paying minimums on most of them and knocking them all down one at a time, hasn't been fun and haven't been doing much other than working for the last 6 months but it is already at a completly better point. If I was paying $300 on my main card at the time and $150 on the rest, when that one got paid off I just go to the next one at $450 a month, stick to it and once you get a couple months into it you will be surprised where you can be.