Spending down debt: The best way to pay depends on your goals

I believe yes because the credit card companies can always raise their interest rate sky high if you are late with a payment I have seen 28% and higher, they can also charge you late fees. But if you do this, use every dime for the bills mister

Replying to Laureen Morrison about being on disability, I am in the same boat. On top of that I went through a divorce in 2002 and was left wil a boat load of credit card debt, had to buy out my ex for half of value of the house in order to keep my home for myself and my three boys.
After trying to deal with the creditors myself, I went through two different reputable credit counseling firms, tore up all my credit cards and was paying through them. However, with the amt. of debt and what I was able to afford to put in the "fund" each month, it wasn't workig. Even wth them getting the late charges stopped and the interest rate dropped, the balances were either not going down or were bein reduced by minute amounts.
Finally I researched and found a debt company that promised to "negotiate" with each creditor to reduce down the balances. It basically worked the same way as I paid a monthly amount into an account. The debt company got their fee up front from the first three payments. I was told it would take about 36 months and once all were paid, they would run my credit report through three cycles to verify all the accounts were reported "paid as agreed". Long story short, I'm now getting call from creditors (law firms mainly) trying to ge me to pay the difference between the negotiated amt. paid and the original balance. Once my account manager left the firm which I wasn't told about (I learned it through a creditor who tried to call her), the communication between the debt payment company to me is spotty and insufficient. I still have debt and am negotiating a few of the debts myself, including the largest one. I've complained and am supposed to be getting a "call" from a manager, but it is all frustrating mess. I stopped the monthly drafts going to that account, but am still being charged monthly
"maintenance" fee. They are telling the remaining few creditors they don't have enough funds available to negotiate with. I can't afford to get a lawyer and still have ongoin medical problems and the bills that come with them.
So, to Laureen, I feel for your plight with the set disabiliy income and trying to simply keep a roof over your head, food in the pantry and the utilities paid with all of them going up, up, up!!! Help!!!!

Not everyone who owes has used their credit irresponsibly. Sometimes circumstances change -- illness, disability, support payments not paid, loss of job, and more.

You can go to Senators and other elected officials for help, including lowering student loan payments. Also try CCCS (reputable group), but you need something to pay with each month.

You can also contact creditors on your own. They would rather have something than nothing! If you just can't, then --

NOTE THIS: after 7 years, IF you pay NOTHING, it should be off your credit record. If not, you can request it be taken off -- seven years after you last paid. (Bankruptcy takes 10 years to come off the record -- but cards love to extend credit if you bankrupt, because you can't do it again for 10 years, so you have to pay.)

They will still contact you! -- but pay nothing, and if they harrass you complain to the state atty. general. Also, give them no info about your current situation.

Not a pleasant result, but if you really have to . . . especially if you have children to feed and keep a roof over their heads. And eventually, with just a bit, you can rebuild credit again -- maybe start with a secured card, store card, gas card. Be sure to pay on time, always, even if only the minimum or by phone.

Do double-check this info, in case it's out of date.

And for everyone who ends up on public support -- disability, welfare, whatever -- keep your pride. And remember, part of why you and your parents have paid taxes is so you will have this support if you need it.

Save $1,000 of it for an emergency fund. Pay off as much debt as you can with the remainder. Go to daveramsey.com and clikc on Financial Peace University to get out of debt and stay out of debt. It changed my life!

Pay off your debt: if you figure that credit cards are running between 14 and 21% and the cost to get a mortgage is between 5.75 and 7%, lose the high interest on your existing debt and bank on the lower mortgage when the housing market regains its balance (which is unlikely to happen for a minimum of 6-9 months). Additionally, with mortgage lending being so tight right now, the lower income to debt ratio will be a huge factor when you DO go back into the real estate market. Hope this helps!

Another great source is www.iabundance.com

You are correct with the Dave Ramsey way, which all he teaches is to spend less than you make. Wow what a concept.Something that I,m pretty sure he would not agree with that I did to get out of credit card debt is this. If you can get them and have the will power to use them with a purpose, take the offer of a zero percent card, transfer your balance on the card with the highest finance charge.With a vengance attack that balance, by the time the introductory rate is over you would have payed it down considerably.Then get another and cancell the old one. Of course you should never purchase anything with the cards and never use a credit card again.

very true works well!!!

CCC does charge a fee...which is minimal, around $30.00 per month. However, they don't offer to negotiate your debt balances. They are what they are.