My debt is putting a strain on me and my fiance and our marrage plans, it scares me alot. I need some advise or help. I just turned 25 in march and am planning on getting married on October 10th of this year. I have been layed off since June of 08 and collecting unemployment witch isn't really a whole lot. my bills keep piling up and i have no money to pay them so i turned to my credit cards. Below is my debt, can anyone tell me what i should concentrate on first and what the best way of going about this debt is.

car 571.84 per month w/ 19,000 left on it 5.9% int.
cc 280.00 per month w/ 18,000 left on it 7.0% int.
cc#2 179.00 per month w/ 13,000 left on it 18.0% fixed int.

total 50,000 in debt

***********************Help?********************** ****

If you're unemployed then why on earth do you still have your car? Wouldn't it be better and easier to sell this, remove that loan, and put any money available against paying your second credit card?

The first and most important thing to do is reign in your spending and get disciplined - you say that debt is putting a strain on you, but it's not - it's your over-spending and inability to live within a budget that is causing the strain.

So the most important point at this stage is to stop overspending - determine your income and what you need to live on, and spend only according to that - not outside of it.

Also, get a job - any job - if it helps bring in more income than unemployment.

Hope that helps.

Agreed. That car loan is eating you alive! That's almost a house payment for some! In my opinion, there is no reason anyone at the age of 25 to have that high of a car payment, ever. Cars are not an investment and lose value everyday you own it. You could find a 02-05 honda civic for $8-12k and pay in cash or have a $150-$250.00 car payment and have in paid off in a few years. All that extra money could be going in savings for an emergency fund (like losing your job), the wedding, a house, or retirement. Another idea is to search Craigslist ads for additional income. I just painted a lady's living room last week and made $100.00 in 3 1/2 hours. Tomorrow I'm helping put up some guys fence and he's offering free food and $20.00 an hour. Or, maybe think about selling unused or unwanted things you don't "NEED". There are a lot of little things to make money that's actually legit, you just have to look. The job markets hard for sure but keep looking up and stay focused. Good Luck

I do not know what type of car you have, but it is way more then you needed or could afford. You used credit cards like they were your money, they are not. Now you have got yourself in really deep.

If he car is worth more then what you owe sell it and pay off the debt. If not you need to know your car loan terms, there will be two possible options. One you can give it back to them and you are clear of the debt regardless of what they get for it, they have the car (this is the easier of the two). If they have a short sale clause, which means you owe them the difference, you need their permission to sell the car and then owe them the difference or you can let them sell it. That solves the car part.

Next you need to look at debt consolidation but for that you will most likely need a job. So you are going to have to take any job you can get. Consolidation will reduce the total payment amount to an affordable number.

After that you are going to have to learn to create a budget and you are going to have to live on it. If you do not things will end up far worse than you can imagine.

You really need to take a practical look at this situation. The American dream has caught up to you. Like was stated, get rid of the car. You can not afford it. Why have you not picked up some type of part time job?

As the others have said...Sell the car and use that money to purchase an older used vehicle that will give you a monthly payment of around $250. Then get a credit card that offers a 0% interest rate as a promotion. Transfer your CC debts with massive interest rates to the 0% and start funding your extra car and interest payment savings toward the principle balance.

Don't let these debt settlement clowns talk you into funding their pockets. That is the stupidest thing I've heard. Settlements will show up negatively on your credit report for 7 years, just like a bankruptcy. Also, there are very few legit debt settlement companies. Many will promise you that they can get your rates down but they can not. The creditors you owe money to are the only ones that can do that. Many also may not always make the payments on time or even the amount they claim they are making. There are many lawsuits out right now for shady business practices by these types of companies. You could look into contacting National Foundation for Credit Counseling which is a NON-PROFIT credit consoling company that is spoken about very highly from many people in finance. But, I still would get out of the over priced car, get a second job if needed, and start paying as much as I could towards the highest interest debt while maintaing the minimum payments on the rest. Then once that is paid off, move to the next highest interest debt and put everything towards that, and so on. This will get you out of debt in 2 years or less.

I agree with the last post, dont fall into the trap of thinking that they can drop your debt to 17K without any negative results. In fact you would be better to file banko than use these guys. IMO banko would be a better option than a debt settlement program.


Mark

If your paying $571 a month, you are driving a pretty nice car that you cannot afford.

Although they are making settlement out to be this awful thing, a settlement style program might be the way to go as long as you understand the risks that are involved.

First, get out of that auto loan. Second, find any work that pays more than unemployment. After you do this, then re-evaluate your options.

The main problem is that its fairly easy to build your credit back after filing banko, most lenders know you wont be able to file banko again for a long time so typically they will re-issue a line of credit. A friend of mine filed banko and was back to a 640 credit score just 8 months after.

Lenders usually do not like giving credit to people who have gone through debt settlement programs as the consumer still has the option of filing banko



Mark