Only Making Minimum Payments And Can’t Get Out of Debt. – Debbie
July 27, 2010
Debbie wrote to me through the GetOutOfDebt.org site and asked the following question. If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.
Income from the GetOutOfDebt.org site advertising is used to help alleviate poverty. If you would like to help me to help others, there are easy and free things you can do, click here to learn how you can help.
“Dear Steve,
I owe $10,000 on four credit cards and can only make the minimum payment. I will never get these debts paid off. I am not behind but I’m having a hard time making them.
Debbie”
Steve’s Answer:
Dear Debbie,
If you can make at least the minimum payments then you might want to click here for debt management information. In a debt management plan your interest rates will be reduced and more of your payments will go towards the debt.
But I’m concerned with that approach. If you are not behind and struggling to make the minimum payments then it is doubtful that a debt management program will work for you since that while the interest rate will be lower, the monthly minimum payment will be about the same.
So let’s say you make payments for three years and then find yourself in a situation where you can’t keep making the payments. While your debt will be lower at that point, you’d probably have to look at bankruptcy as a solution. You will have just wasted three years of your life making payments that never solved the problem.
If that does not sound like a good outcome for you then you might want to consider bankruptcy now and if you feel compelled to repay your debts, you can do so after bankruptcy. There is no legal obligation to do so but nothing is stopping you either.
Before you decide what to do I would suggest that you contact a debt management company and a local bankruptcy attorney and see which of those solutions sounds like a better approach for you.
Please let me know what you decide to do.
Big hug.
Source: Only Making Minimum Payments And Can’t Get Out of Debt. – Debbie
Originally posted 2009-03-12 14:51:08.
Other Related Articles to Read
Tags: credit counseling, debt management
Debbie,
Also you may consider checking out a PERFORMANCE BASED debt settlement company as they negotiate with your creditors so that you would roughly pay a little more than half your debt back over a 2.5 years period.
That program would most likely offer a lower payment than you are making now.
Sometimes debt settlement is the best alternative to filing for BK.
Best Luck.
Ryan McDonald
Assista Financial Solutions
[Reply to This Comment]