Your Thoughts Please on--

**Hollyhandi** · 02-22-2006, 09:02 AM

debt consoladation (sp ) loans.
Has anyone done this and has it helped you get on track?
We are seriously thinking of trying to get one so we can work on paying one bill instead of dozens (it seems ).
Your thoughts will be appreciated...

**frugalfarmwife** · 02-22-2006, 09:08 AM

I'd avoid it if at all possible, start first by sitting down and writing out a budget and tracking all bills and payment dates.

One thing that helps me TREMENDIOUSLY is paying bills through my bank online, I can sit down right when the bill comes in and schedule payment the same day. I saved over 40.00 in postage alone last year doing online payments and didn't have one single late payment

kj

**FrugalMomof3** · 02-22-2006, 09:22 AM

I agree, I would avoid it as well.

**nodmicks** · 02-22-2006, 09:33 AM

I also agree to avoid it as well. Almost everyone we know who has done it has not done so hot. I seriously think we need to feel the pain of paying every debt bill to get the big message " no more debting".
It took us years to pay off over 16K in cc debt but it taught us a very very strong lesson.
Surfing balances to lower rate cards etc also helped us.
We used the Dave Ramsey snowball principal and I can't say enough good about it!

I know those lots of bills are frustrating but you get "wins" as each is paid off no matter how small the debt!
Hang in there!

**homesteadmamma** · 02-22-2006, 09:44 AM

I agree with what has been said.

**madhen** · 02-22-2006, 10:15 AM

I know they are not recommended by most of the financial gurus who advocate debt reduction. The biggest concern with debt consolidation loans is that you are basically borrowing even more to get out of your current debt. If you decide to go that route, however, you should cancel your credit cards the DAY you pay them off, because what most people do is pay off their cards, but then start slowly adding up the balance again. Before you know it, you have all your credit cards to pay again, AND the consolidation loan.

**sunshine** · 02-22-2006, 10:17 AM

AVOID IT!

Too many people consolidate their bills, and then run up the credit cards again- while still paying off the consolidation loan (and they ALL say- oh, I won't do that, but they do)

**Hollyhandi** · 02-22-2006, 10:53 AM

Our cc cards will be cut into many many pieces the day they are paid off.
I am just sick of the phone calls day after day then when you try to work with them they say you have to pay more than we can.
We only get 1400.00 a month thats with him working part time and then his hours have been cut to 15 a week.
If we consolidate we have one bill not 7..... If we try Dave Ramsey's way we'll never be out of debt. We don't have it to snowball into the next.....

**Vannie** · 02-22-2006, 11:00 AM

I totally agree with everyone who has answered. Many years ago my husband and I did this. Unfortunately, we had to do it again and again. I finally had enough and would not co-sign with my husband for another loan.

Sunshine's words made me remember when and shudder.

**nodmicks** · 02-22-2006, 11:13 AM

Holly~ if the bills are with collections send them a cease and desist letter. Then they can not legally call and bug you.

Imediately after I married Dh (*you know hen it appeared in the paper) I started getting phone calls at work (1993)about his old collection accounts. Besides being mad at him I was very stressed. I sent every one of them the cease and desist letter so they could only contact us by mail. It is a sanity saver.

We did not have any extra $ to snowball in the beginning. However when I paid off the first bill with a small payment of 25$ I just applied that to the next smallest bill. I just committed pay the payment of any small bill I paid to the next one. Eventually it added up. I admit it was hard though until the last bit under 2 years as we were making under 30K for a family of 4 and lots of pets.

I guess only you know what is best in your circumstances though. Would the payment on a consolidation loan be any less than your current payments? Can you get a good rate?

Hugs Holly! I am really sorry this is happening to you! Take heart though there is light at the nd of the tunnel and I very throughly believe we all get our rewards!!!

I hate to mention this but I will just incase. A friend of mine had credit that was shot anyways with multiple credit card debts. She called every cc company and told them she was looking at filing bankruptcy and what was the minimum the credit card co could settle the balance for. Most of them settled for alot less cuz they would get 0 when she filed. She also settled a hospital bill this way. Since she was veryclose to filing and her credit was shot it was a good route for her. She used her tax refund to pay these folks. Not that I'm suggesting this to anyone necessarily.

**halloweenfreak** · 02-22-2006, 11:21 AM

hmmm my parents did it, and they're happy they did. they paid off the house, my college loans (they promised if i graduated, theyd pay for it all) all the cc's, and all with a lower interest rate and a smaller payment then what they made towards the house payment alone. ive seriously considered it just to get out from under the mortgage people we have now. i should have known not to deal with them when it took over 6 months just to close on our house. then they would call and harass me the day before payment was due telling me they have yet to receive my payment and would i like to do that now? sheesh.

**Hollyhandi** · 02-22-2006, 11:22 AM

Thanks romick. I'll do that.
Right now I just let the machine answer....
If its someone to I want to talk to I call them back.
I ffel like I'm under seige

**nodmicks** · 02-22-2006, 11:26 AM

Oh Hooy I forgot to mention you need to send them registed mail so you have poof you sent it. If they do contact you unlawfully then you can have all kinds of fun with it.

**madhen** · 02-22-2006, 12:08 PM

Even if your credit is not shot, calling the cc's and threatening them that you are close to filing for bankruptcy is a pretty good negotiating tool. If nothing else, they may be willing to waive interest and finance charges temporarily. CC's have the most to lose, because there isn't anything that they can leverage to get their money back.

**Hollyhandi** · 02-22-2006, 12:32 PM

Thanks rodmick,
It will be worth it. i'll also call them and tell them about the
bankrupcy (because we are very close to having to file one )
This what we are trying so hard not to do..