Best way to handle $12,000 credit card debt?

**Jluke** · 02-20-2016, 05:38 PM

Pay it off.

Get a 2nd job if you have to.

Need more details to really help you.

Do you have savings?

What does your budget look like?

Is the debt business related or personal expenses?

**creditcardfree** · 02-21-2016, 08:33 AM

You probably won't be able to get a loan, even with those lending clubs you are a risk to those who lend the money based on your credit score.

So, dig in and pay them off. Lower your spending to free up the cash you are already earning to pay on your credit cards. Focus on one card at a time. Usually the lowest balance first is a good motivator. Keep paying minimums on the other three cards.

Bring in more income will help you get those debts paid off faster. As your credit score improves you may be over lower rate cards to transfer your balance to. Do the math and determine if this is beneficial to you.

More information is needed to give specific advice.

**disneysteve** · 02-21-2016, 03:13 PM

What are your monthly expenses? Is the $3,000 gross or net?

You need to up your income any way you can and slash your expenses to the bare minimum. As Dave Ramsey says, you shouldn't see the inside of a restaurant unless you're working there.

Are you able to make the monthly payments? You should be paying the minimum on 3 cards and putting all extra money to the one card with the highest interest rate.

**92024** · 02-21-2016, 04:00 PM

Thanks...

Many thanks for the replies.

I was hoping to get an answer to my specific question:

Is it better for me to try to get a loan from such as prosper.com or LendingClub... or to try to negotiate with my credit card companies? (Any tips?)

Thanks

**disneysteve** · 02-21-2016, 04:22 PM

Originally posted by 92024 View Post

Many thanks for the replies.

I was hoping to get an answer to my specific question:

Is it better for me to try to get a loan from such as prosper.com or LendingClub... or to try to negotiate with my credit card companies? (Any tips?)

Thanks

The answer to your question is NEITHER.

You're asking the wrong question. What you should be asking is "How can I best go about repaying my debt?" The answer to that depends on you providing more information, as we indicated. List your monthly take home pay and your monthly expenses. From there, we can help guide you toward knocking out the debt. Also, you need to be looking to boost your income either with more hours at your current job if that's an option or a second job to supplement it.

**PhilDanley** · 02-26-2016, 02:55 PM

No Magic Answer Unfortunately

92024:

I did some quick checks of the two websites and I don't know if you can get much help from them without knowing more of your particular info. Looks like you'd probably get interest rates in the high teens to low twenties percentage range which you probably have already with your credit cards.

Do you need to pursue a debt management plan? If you aren't behind in your bills currently then this would just hurt your credit score unnecessarily in order to shave a few points off your interest rate.

You really need to sit down and write out your budget so you know if you need to trim expenses, get a second job, sell some stuff, etc.

**PhilDanley** · 02-26-2016, 04:14 PM

FICO Score Too Low

I researched more info for both lenders. Both charge up to a 5% loan origination fee. Prosper requires a minimum FICO score of 640 and LendingClub requires a 660. Some good info here: http://www.doughroller.net/credit/co...comment-510822

**92024** · 02-26-2016, 05:12 PM

Thanks!

Many thanks for the excellent replies and advice!
It was worth inquiring about other options, but it seems I'll just have to knuckle down and pay off the credit cards as suggested.
Cheers!

**disneysteve** · 02-26-2016, 07:09 PM

Originally posted by 92024 View Post

it seems I'll just have to knuckle down and pay off the credit cards as suggested.

Exactly! Always remember, you can't borrow your way out of debt.

**PhilDanley** · 02-26-2016, 08:01 PM

It Ain't Easy!

Debt consolidation is relatively easy but it doesn't cure the problem, it just treats the symptom. I've read 70-75% of people who go through debt consolidation are back in serious debt within three years. And 16% of bankruptcy cases are repeat filers!

Creating your budget will take a few hours of work and it will need some revisions for the first few months. But the effort will be worth it! You'll change your habits and your actions so you'll never have to go through debt payoffs again.

Good luck to you!

**92024** · 03-01-2016, 04:31 PM

"Hardship Programs"

Many thanks again for the excellent replies.

I called one of my credit card companies to try to get the interest rate lowered.
They said they couldn't do that, but if I was in financial difficulty, they, and all credit card companies, have something called a "hardship program."

They gave me the phone number of a non-profit that they work with, who would probably be able to get the interest rate lowered.

I googled "hardship programs:"

To get into a credit card hardship program you have to contact your credit card issuer and show them evidence that currently you are really experiencing a financial hardship and you are unable to continue credit card payments under the current terms.

Sounds like a plan!

**Jovanny** · 03-02-2016, 01:42 AM

I think you should switch to a job that pays you higher. Also try paying the debts one at a time. It will help to improve your situation.

**bjl584** · 03-03-2016, 04:28 AM

Originally posted by 92024 View Post

Many thanks again for the excellent replies.

I called one of my credit card companies to try to get the interest rate lowered.
They said they couldn't do that, but if I was in financial difficulty, they, and all credit card companies, have something called a "hardship program."

They gave me the phone number of a non-profit that they work with, who would probably be able to get the interest rate lowered.

I googled "hardship programs:"

To get into a credit card hardship program you have to contact your credit card issuer and show them evidence that currently you are really experiencing a financial hardship and you are unable to continue credit card payments under the current terms.

Sounds like a plan!

I wouldn't do this. Typically, they will only work with you if you start missing payments. You would have to literally stop paying on the cards for a few months before they will lower your rates. Your credit score will get trashed in the process.

A better idea would be to raise income by getting a part time job and look at other credit card offers to do a possible balance transfer to a card with a lower rate. Cut your expenses back and look at selling some unwanted and unused items. Throw every dollar that you can at the debts till they are gone.

**Jluke** · 03-03-2016, 06:40 AM

Originally posted by 92024 View Post

To get into a credit card hardship program you have to contact your credit card issuer and show them evidence that currently you are really experiencing a financial hardship and you are unable to continue credit card payments under the current terms.

Sounds like a plan!

Sounds like you are looking for an easy way out of this debt.

You will regret it.

Best way to handle $12,000 credit card debt?