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Should We Go With MMI Since We Can’t Find a Debt Consolidation Loan? – Tony

“Dear Steve,

Over the years due to some large emergency expenses, not having an emergency fund, overspending on our part and a decrease in my income my husband and I have accumulated a large amount of credit card debt. We have always valued our good credit and have always kept a handle on it, but credit card APR and limit changes are making this increasingly difficult.

My husband and I have about about 40,000.00 in credit card debt. Nothing is past due and has never been. We both have a credit score of over 700. Over the past several years our creditors have begun raising our interest rates to completely unreal percentages, making our min monthly payment increase. Along with this, they have been decreasing our limits as we pay down balances. We are currently able to make the minimums, but I would love to be able to pay off these balances quicker.

I have looked into MMI to possibly consolidate everything, but I understand that these type of programs can affect your credit score. Because our balances are high as compared to our limits, due to the credit companies decreasing them, we are finding it difficult to apply for a standard consolidation or get our existing companies to decrease the APR.

Are the risks of using MMI worth it to be able to get out from under all of this unsecured debt? Since we keep being turned down for any other loan to consolidate and we seem to be unable to open any new unsecured accounts, I feel we are “unable” to make use of our good credit anyway…what can it hurt to lose a few points? Or, is there another option that I am unaware of that you can offer?


Dear Tony,

Thank you for reaching out to me for help.

One option that I think makes sense to explore first is a peer-to-peer debt consolidation loan through LendingClub is a different way to borrow money. It cuts out the banks and allows people like you and me invest in loans for other people, like you and me. About 70 percent of the loans they facilitate are for debt consolidation and with your current credit scores you are at least eligible.

In fact I happen to be a lender through them so if you go that route, let me know what your loan number is and I’ll help fund it.

I believe the limit on loans is $30,000 so while it won’t payoff the entire balance we can focus on knocking out the highest interest rates. That should make a huge difference.

The LendingClub loans are for up to five years and at a fixed interest rate. Best yet, they are unsecured.

This approach would allow you to payoff your cards, cut your monthly expenses and preserve your credit.

Does that sound like a reasonable approach to begin with?

If that doesn’t work for you we can then look into credit counseling further.

Please post your responses and follow-up messages to me on this in the comments section below.

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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • TonyW

    Thank you for the help.  I actually looked into after reading another post on the site.  Unfortunately, we live in Tennessee and they are not accepting applications from our state.  I have also gotten some information from Debtcor, along with MMI.  If this was going to be our best option, do you have a recommendation as to which company is better?

    • Steve Rhode

      Tony, is a similar peer-to-peer lender and does lend in Tennessee.


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