First, some background information. I am 30 years old and, up until recently, had very good credit. I have had only one credit card for 12 years that I only used for emergencies and always paid the monthly payment on, often more than the minimum. I did have a couple other credit cards in that time that I had briefly, but paid off quickly and closed. I had always been frugal and had a nice chunk in savings. I paid cash for both cars I have ever owned, never wanting to be weighed down with debt. I was able to get away with only $3,500 in student loans because of grants and personal savings.

Then, 2 years ago, I got married and had a baby. We had health insurance, but with the maternity, it was costing us over $700/month. Also, my husband had bought a home (in pricey San Diego) prior to us meeting. A commitment he could make easily before having a family to support, but with all the new expenses, we became a sinking ship. In no time at all, my $2,000 CC debt turned into $7,000, being used to pay bills (house tax, home insurance, etc.). My student loans fell by the wayside because we didn't have the money to pay all of our bills every month, and that one had the lowest interest rate. My husband had excellent credit as well, and only had one credit card with a low balance. Let it be known that we are both hard working people. My husband has put in 60+ hours a week for the last 3 years, but hasn't gotten the raises/bonuses that have been promised (a whole other can of worms).

The kicker? We live a very meager lifestyle. We share one car (a 2000 Chevy Tracker - one of the cheapest cars on the road). We work less than a mile from home, so gas expense is very low. We don't have cell phones, big screen TVs, or any "toys" to speak of (just this 5 year old computer. All the clothes and shoes I own are at least 3 years old, minus some gifts. All the clothes and toys our daughter owns (which isn't much) have been given to us by family. We don't eat out, and have very rare "splurge" days. For a long time, we didn't even have meat in our diet because it was considered an expensive luxury. Even now, it's not regular.

So, now the rant...

Despite our hardship, we have continued to pay the minimum payment on my credit card. We are both responsible people and have always tried to be as financially responsible as we can. We just fell on a hard time and have been one step behind since then. We are always waiting for the next paycheck, and it always seems to come just one day too late. So, it was only a matter of time before the credit card bill was one day late. It happened last August. And BOOM! The $40 late fee. Then the CC company decides to take a look at my credit report. They see the default on my school loans and... BOOM! Interest rate goes to 30%. Then, BOOM! They lower my limit to just below what I owe. Then BOOM! They charge the finance charge. So then, BOOM! I am over my limit, so it's another $40 charge. ALL THIS IN ONE DAY WITHOUT ADVISING ME PRIOR! I received the letter that my limit will be lowered "effective immediately" TWO DAYS AFTER IT HAPPENED. The statement was sent the day they did it. There was no way for me to avoid the over-limit fee. They lowered my limit the same day they were to charge the finance charge, knowing this would put me over-limit. I immediately called them and spoke with a customer service agent that was obviously trained to play dumb and keep repeating a script. I knew I wasn't the first person they had done this to. At that time, I had a pre-paid phone, so being on the phone for a few hours arguing and sobbing ended up costing me nearly as much as the fees. Of course, I ran out of minutes before getting any help and was cut off. I had to wait until my husband got home from work to use his company mobile phone to start all over with a new agent. Eventually, they told me they would have a supervisor call me. The following day someone called and reversed the over-limit charges and graciously lowered my interest rate from 30% to 18% (it was the first time in 10 years of owning the card that I had requested this, so I guess they thought they were doing me a favor).

Fast-forward to present, keeping in mind that the card has not even been used in nearly a year. I receive a statement basically saying that my credit report had been reviewed again recently and so my interest rate is going up again and my limit is being lowered again "effective immediately". The only negative things on my credit are my defaulted school loans and a $500 medical bill. So again, despite trying to be faithful to this credit card, they do the same thing they did in August. On the day they send the notice, they lower my limit and charge the finance charge, which puts me over-limit! So, BOOM! Another $40 fee. The card hasn't even been used in nearly a year! And I have paid faithfully on it, despite it being a significant financial hardship for us ($250/month). This means, missing one month because we can't afford all the fees and high interest leaves us in a hole we can't recover from. If we are late, the amount we will owe next month will total nearly $600. From there it will snowball and will leave us homeless if we pay that instead of our mortgage. And, regardless, we are only paying the minimum, so the balance has only gone down $500 in 7 months. Meaning $1,250 of the 1,750 we have paid since then was just interest.

My husband was in a 3 year fix rate on his home, that just expired. Our house payment is now all that we can afford. We can't sell now, because with the housing crisis we are upside down. It's so frustrating for us because we have very few bills and frills, and yet, we are drowning. We even had to drop health insurance to catch up a little. Luckily my daughter can still get health care through a state program; although, we were just under the financial qualification, so if my husband gets any kind of bonus or raise, she will be ineligible.

These are our obligations every month:

Mortgage $3200
1 car payment $200
Car insurance $75
My credit card $250
His credit card $150
Cable/Internet $50
Utilities +/- $300
Daughter's health care $15

The rest goes to food, gas, and necessities.

As for the school loans... they hijacked our tax return this year - money we were planning to use to pay down/off our credit cards for a little more breathing room.

We don't really have a lot of debt to consolidate. Although my credit card is now at $6,500, only $1,300 is owed on his. It wouldn't make sense for us to go the route of consolidating. It would probably hurt us, more than help.

So, here it is, the day my credit card payment is due, undeserved/unethical fees, and all, and this time, I don't have a phone to call and argue and beg for mercy. Unfortunately, the payment will be late again because the gas/electric bill is two months over-due.

I am so frustrated, knowing that we don't engage in frivolous spending, and still are barely surviving. None of our credit card debt is from foolish purchases. The only non-emergency expense I have used credit for is a dress for a friend's wedding 10 years ago that cost $50, but that I have probably paid $5,000 for by now. *sigh*


Not sure what to do anymore, but cry.