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Do I close the CCs?


beans
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I am trying to get out from beneath a big pile of debt. I've called the CC companies and none of them will work w/me and reduce the int. rate.

Would I get better results by closing the accts? Will this have a negative impact on my CR? (which isn't that great right now anyway).

How do I get them to lower the APR even alittle?

Thanks for any help!

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Welcome, beans...we'll help if we can.

Most CC companies do have hardship programs...you have to keep working your way up the management chain until you find someone that will talk to you about them...but...

The hardship programs usually only last a year or so, and may have some very difficult conditions for you to meet once they're completed. You should really only consider these programs IF your inability to pay is temporary. If you're looking to dig your way out of this without significantly increasing your income or decreasing your expenses, you might be better off considering BK.

How much total we talking about? What CCs?

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Closing the accounts when a balance is due is not going to help you.

They will automatically close them if you go into default or go over the CL. From their point of view, if you owe them a tidy sum, they know they will take you to court and collect one way or another.

Even though you may owe a lot of money to the CCs, can you maybe borrow some from someplace to pay them off or get a CC from a credit union with a lower rate and transer the balances? I know it depends on you score.

Maybe you could give some more info.

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MBNA, providian, capital one, discover, and a bunch of store ones. The highest amt owed is 3700 to discover, but they are actually working with us. The next highest is cap1, then mbna. The store ones are 500 or less. The big ones got run up 2yrs ago when I had a medical crisis and our income was severely affected. We lived off the cc for a while.

I've tried to get a HELOC, consolidation loan, etc. No luck.

I have one charge off and dh has 2. Mine, I settled in full for less, his we haven't heard from since last year. But, no one will help us bc of this.

I looked into CCCS, but they'd only get us out of debt 4mths sooner then we could do on our own, according to them. I did the whole budget with them and there isn't too much more we could cut back on. There just is no $. We don't go out, no vacations, etc.

We just live paying off these debts!

I looked into CSA(credit solutions of america). I am not too sure about becoming 120+ days overdue and then trying to get them to settle. Any info on them?

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Okay, first of all...DO NOT get involved with CCCS or CSA or any of the other repair / consolidator places. They're all scams....and you'll wind up in a bigger hole than you are now.

Just guessing, but it looks like you may be in the $15-20,000 range as far as CCs. That's not a lot (by today's standards). Are you buying a house? I don't normally suggest trading unsecured debt (CCs) for secured debt (second mortgage on house) but that might be an option. You might also look into credit unions. A personal loan maybe?

Let me think about this awhile...

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So, the charge offs hurt. Particularly the one that you paid. All the other CCs will look at your CRs and think you've got at least some money to work with...so that will make them that much tougher to deal with. So here's my thoughts...you got two choices...

1. Sit down and work out a reasonable budget...one you can live with. List all the things you need to live with (nevermind the CCs), throw in a little for "entertainment", and see what's left. Take what's left and divide it up among the CCs...it probably won't come close to what they want as a minimum payment, but don't worry about that...make a budget you can live with.

If the payment to each is really small...like only 10-20% of a minimum, then go to choice 2....don't waste any more of you life trying to fix something you can't fix. If the payment you can afford is higher than that, then write a letter to the executive offices of each CC saying..."gee, we had tough times, now we're better, we'd like to work with you...here's what we can afford to pay...let us know if you'll waive the fees and lates and accept this until we get you paid off". If any of them...any...say no, got to choice 2. If ALL agree, stick to the budget. Otherwise...

2. Declare Bk. Get a copy of NOLO PRESS's "How to file for Chapter 7 Bankruptcy" and fill out the forms. You might also discuss the whole thing with a lawyer or two...depending on what assets you have, you may have to look at a BK 13, but a lawyer should be able to tell you that.

And remember...you're not alone...bad things happen to good people. We're all just a medical crisis away from being in too deep. If you wind up with a BK, there's lots of other folks there with you...

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go to www.cheapskatemonthly.com . Mary Hunt has some good ideas you might find useful.

Also, if you do close the accounts, or you think they will close them on you, make sure it gets reported that the accounts were "closed at consumer's request." Do this by writing them a letter, CMRRR, telling them you are asking them to close the accounts and they should report to EQ EX and TU that you closed them, and they should report to you that they did so.

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