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We Want Our Credit Card Debt Gone. – Erin

By on May 5, 2012
We Want Our Credit Card Debt Gone. – Erin

“Dear Steve,

I have credit card debt and need help. I have $3000 at 14% interest, 10,000 at 18%, and another $17,700 at 18%. As of right now our mortgage and all these cards are paid up. I had been late on a mortgage payment about a month ago, but this too was caught up. However, we are self employed and right now the money isn’t coming in, so I am trying to be a little proactive. In 2010, we made after taxes only $10,000, hense some of the debt above. In 2011, we made $39,900 after taxes. But this year we have made only about $8,000 so far. We pay alittle more than the minimum on 2 of these and the minimum on the 3rd. I feel like we are never going to get out of this hole. We own our home and also have a $9,000 equiline balance. We have cut up our cards and no longer use them even though the accounts are still open. Creditors will not lower our % rates.

Would you recommend Chapter 13 or Chapter 7? I just want this all done with. I don’t want to lose the house…but I would really like to get rid of the credit card debt.

Erin”

Dear Erin,

Am I correct in the fact you own your house free and clear except for a $9,000 equity line of credit? Or do you have an additional mortgage on your house? How much is your house worth?

If the credit card debt was gone, with your low income you reported, would you be able to live month to month without using credit?

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 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.

4 Comments

  1. Erin

    May 5, 2012 at 3:42 pm

    oops…iI wasnt done…makes it hard to make any headway and the total credit card payments are just too high to keep going at this rate. we cut up the cards and dont use them, but the accounts r still open.

    • Steve Rhode

      May 6, 2012 at 10:28 am

      OK. It makes logical sense for you to first pursue a credit counseling approach which will most likely significantly reduce your interest rates. I like this credit counseling group, click here to fill out the request form.

      In evaluating their recommended solution I want to make sure that you are comfortable making the minimum payments and you are able to save money each month at the same time. A credit counseling program takes five years to complete and you need to be prepared for the long haul.

      After you chat with them, come on back and give me an update and let’s see if that will work for you or we need to think of a Plan B.

      Steve

      • Erin

        May 27, 2012 at 5:29 pm

        The Click Here link doesn’t work on any of my computers.  Can you reenter it?

  2. Erin

    May 5, 2012 at 3:40 pm

    we owe $129,000 on our home. It appraises for $170,000.  Yes, we can make our ourmortgage payments and bills month to month, but the interest on the credit cards makes

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