Advice: Should I pay off my debt with a personal loan?

[Sandra712]

I have about $15,000 in credit card debt. I am almost 2 months past due on all 7 of my cards. I want to get out of debt and need some advice about how to do it. I dont make much money and I am only able to afford about 300 per month. I was told that I might be able to get a loan and pay the debts off with a lower payment. Is that possible? I own a home, but there it is not worth much more than I owe. I appreciate any advice you can give.

Sincerely,

Sandra

[Rob4president]

Dont be silly. You are 2 months past due on 7 accounts. No one in their right mind will give you an unsecured loan for that amount unless they were high during the loan process and had absolutely no business sense whatsoever. Even if it was possible to get around the whole credit rating problem, you would be paying loansharking rates of 23% or higher.

You said you can afford $300 per month, right? That is about 2% of $15k so you should be able to afford the minimums if you were able to get current.

I recommend you find a legitimate Credit Counseling Services "CCCS" to help you get a grip on the payments. I cant really recommend a specific company because I have never used one, but I do know that some of the good cccs companies do work. This is what they do. They calculate your payment by reviewing your creditors and balances. It's usually 2.5% to 3% of your total debt. (there is a formula they use to calculate the payment. its based entirely on what the creditors are willing to accept through this new debt management program) Then, you make one payment to the cccs company, then they dispurse your funds (minus their fee) to your creditors. The big benefit is they negotiate the interest rates with creditors, so more money goes to principal, they consolidate your payment and that is a convenience, they can usually re-age your accounts to help waive old fees and penalties, they can sometimes get accounts to begin reporting positively to the credit bureaus. This usually helps consumers pay off their debt in about 3-5 years depending on different factors.

There are other options, but based on what you said, I believe you need a good consumer consolidation company.