I’m trying to figure my way out of a situation and could really use some help – I am a senior in college and manage to just get by every month from two part time jobs and student financial aid from the government. My problem is that over the past five years I’ve had some major expenses that I couldn’t pay for and so I now have about $14,000 in credit card debt, all at over 25% APR and my payments are over $500 a month – amazingly I’m current on everything but just break even every month. So my credit score would be really good except for the high balances.
I need some advice about different options – I’ve read debt negotiation can slash your liability to half or less, but that they will only consider it if you’re really behind on payments – I’m afraid if I stop paying my bills just to qualify for this that it will really hurt my credit score, and I’d like to be able to get a mortgage in a couple years so I’m worried. Is there any way to do this while remaing current on everything?
Also, I’ve considered debt consolidation but since I technically only work part time I think my income is disqualifying me from getting one. My worry is that there will be time after graduation when I no longer have financial aid and before I can secure a good job that I just really won’t be able to make these high monthly payments. I’ll be able to take on more hours at each job once school is over and I’m looking for a permanent one, and I’ll be trying to get a job even before graduation but its really tough right now.
What do you think is my best course of action?
Can I somehow leverage the fact that I’ve consisently been on time with all of my payments and show that logically, if I’ve been responsible enough to pay $500 a month, then I can surely pay a lower rate consolidation loan off at $300 a month?
I know if I could get a reduced interest rate that I’d be okay, but if I can’t improve my situation the current high rates are going to swallow me eventually. I’m just really confused and nervous because I hear a lot of bad stories about companies really messing people over in a serious way. So I thought I would ask for advice first –
Thank you so much in advance for any advice you can give me,
I’ve also tried to find information on Obama’s bill because I’ve heard that I might qualify to have my debt cut in half – but nowhere can I find any information on how to actually do that or who to talk to or which government agency deals with this. All I can find are things that say I can do it but never how to actually do it. How can I use the President’s bill to help me – what actual steps do I need to take to cut my debt in half?”
Did I read this right? Are you making your current payments now from money that comes from financial aid? If so, YIKES!
It sounds like the reality is you don’t currently bring in enough income to make ends meet so the credit card has become a fall back way to meet those expenses.
My concern at this point is if you graduated on a credit counseling debt management plan to repay the debt and then were unable to secure a job, the plan would fail and all the money paid to date would have lowered your balances but would not have gotten you out of debt.
The debt settlement approach might make sense if you could get your hands on $7,000 in the next three to five months but I’m dubious that is a reality as well.
Personally I think the most logical approach is for you to first speak to a local bankruptcy attorney. You can click here to find a local bankruptcy attorney and if you’d like a second opinion about your situation or a personal consultation by another debt coach, please feel free to contact
As a senior you are going to be graduating and your student loans will kick in afterwards. If you want to start post-college life with the best chance of getting ahead then bankruptcy is a real consideration.
By the way, there is no Obama program to cut your debt in half. All of that crap you’ve heard is just marketing hype to sell you a service based on a lie.
Please post your responses and follow-up messages to me on this in the comments section below.