Get Out Of Loan Debt

Comment from beckoningsubstitutes
Time June 21, 2009 at 8:46 pm

I can’t speak to the statistics. However, credit is so easy to get and so easy to mismanage. The credit card companies make money when people don’t pay off their balance. The make money when you go over your limit. You have to take care of yourself. We should grow a brain and know that they want your money.

Comment from KIDD3422
Time June 24, 2009 at 11:13 am

Yes, it’s pretty close to the truth. People get in debt because credit card companies pass out cards pretty freely. Many people get in the debt when they are younger because there are many things they want that they can’t afford and they see the credit card as the ability to afford those things. Unfortunately, that debt continues as they age and it never goes away. The only people that can really help one get out of debt is themselves. They need to cut up the cards and cut off the spending that is unnecessary. I think I’d put the mess in the hands of both the people and the creditors. The creditors have INSANE interest rates that once people get in debt with…it’s almost impossible to get out. But the people do see these rates before they get the cards and should be responsible on what they spend and how they spend it. It’s a crisis that will probably never go away.

Comment from Steveo
Time June 25, 2009 at 2:45 am

Two ways to view this. One is that these people who get the cards are swayed by the easy way they get money and goods and services. I tried with both of my kids to advise them not to get hooked. Both did. It’s like smoking. You get hooked when you are young and stupid.

I’ve been hooked when I was married. And it was my ex who put up in this trip down the road to hell. I’ve been in bk twice. Both times because of my ex and the road to divorce. The second time was due to her wanting custody of the children. I won that war, but I had to do a chapter 7. I am now one year away from having that removed from my record. Everything gets paid off every month.

The government won’t do anything, because this is an issue that they should not get involved with. It’s an issue that individuals must deal with. If they offered free advice, and they do through their FTC websites, people would see how insidious these credit cards can be.

This happens to everyone.

Comment from ♥ Mary ♥
Time June 28, 2009 at 11:28 am

I disagree with the two top people. Only cause if they are passing out credit cards so freely I would LOVE to see on passed on to me! People make it sound so easy to get a credit card and it really is very hard to get one. I got a loan easier then I can get a credit card.

In general though many people don’t know how to use a credit card. Your only supposed to use 30% of the card balance and pay it off in full every single month. If you are paying the minimum then you are going to get in debt with the interest.

Below me:

Mistake #2) (THIS IS A MISTAKE!)
opening a credit card account.
NEVER use a credit card if you cannot pay off the balance at the next bill. This is how they make their money. If you have to use credit, take advantage of the “x months same as cash” and PAY IT OFF before the interest rate comes into effect. Then close the account.

Never open a credit card account and use it for a few months and then close it, it looks bad on your credit. Keep it open but only use it a little and pay it off each month!

Comment from luv_my_rats
Time June 28, 2009 at 2:32 pm

Mistake#1)
trying to live above your means.
People who drive $40,000 cars, always have the latest clothing fashions, and live in homes where they can barely make their necessities bills (power, water, rent, food) are stupid. Buying a brand new car is a waste of money. Leasing cars is a waste of money. Buy a almost brand new car if you must have newer, but don’t pay almost new prices for it.

Mistake #2)
opening a credit card account.
NEVER use a credit card if you cannot pay off the balance at the next bill. This is how they make their money. If you have to use credit, take advantage of the “x months same as cash” and PAY IT OFF before the interest rate comes into effect. Then close the account.

Mistake#3)
paying the minimum balance or not paying at all.
Creditors are out to make money on the interest they get from people who only make the minimum payment, which is designed to take YEARS to pay off. Pay extra to the bill and designate that the extra is to be applied to the principle balance.

The credit companies really don’t care that you can pay it off or not. They make enough money that a bankruptcy really won’t dent their accounts.

Many offer tips to help pay your debt off. The govt. does offer some programs to help you consolidate and pay off your debt. You can also get help from any other non-profit debt consolidation group to help pay off the bills, usually for a monthly fee. Depending on your amount of debt it can take a few years. Sometimes the credit companies will lower interest rates or stop applying interest to accounts which are being handled by a debt consolidation group to help you be able to pay it off.

If an account is long not paid off and they send a bill collector after you, you can sometimes make a deal with them to pay half of what is due all at once and call the debt clear. Make sure you get something in writing to verify that your debt is clear.

If you have credit problems get at least an annual check done and review it to see that all accounts that should be closed really are, and that they are reporting correct debt amounts. You should be able to get one for free from any of the 3 major credit reporting organizations.

Not all debt is bad, however. Mortgages are something that is worth it. We usually avoid credit cards and any other debt unless it is something that is ok – like for a used car loan, a roof, a heat pump, etc. Something that will be an investment to the home and will build it’s value. Don’t get a credit card to build credit. Get a loan instead, and pay it off as soon as you can.

Always check to make sure there are no penalties for paying off your debt early, and that extra on payments can be applied to the principle to help pay it off sooner and pay less interest in the long run.

The creditors are evil for giving credit to people who they know cannot pay it off – for a higher rate, of course.

HOWEVER, it is the person who accepts higher rates and is irresponsible with their money who is the one to blame. The people who bit into those low teaser interest rates for the variable interest mortgage rates failed to estimate or acknowledge that the rate WOULD increase , how much it would increase, and whether or not they could pay when it went up. It’s their own fault. IMO the gov’t. should not step in and save them – at least not pardon them from their debt. They should be held at least mostly accountable.

Comment from dshag
Time June 29, 2009 at 2:17 am

If people are stupid enough to spend too much then its their fault. You can blame the credit card companies but now a days in this world people will make money anyway they can, even if its taking advantage of people that dont know better. I mean i use credit cards for pretty much everything but have paid them off evry month since ive been 16, im 22 now and at 16 my dad cosigned for a card. i probly get atleast 1 credit card offer a month and have for years