Here's what I got:

Penfed CC 15k @ 2.99% life --$287/mo
Citi 9k @ 5.74% (will close 35K line 7/31/10 b/c opt-out of 14.99 APR) --$163 /mo
BOFA 9.2k @ 11.24% var (just came off 0% promo) --$91/mo
Chase 8.3k @ 8.99% fixed (just came off 0% promo) -$181/mo
Amex 1.4k @ 10.24% -- $30 /mo

Plus a car loan @ 5.9% $8,300 --$460/mo
Rent -- $1875/mo

Most of the debt was accumulated to get out of our home which was unaffordable.

So we have about 42k cc debt and all the promos have dried up or LOC are much smaller than in past.

So our min expenses--minus food and necessities are ~3,100 month.
I have been paying min due simply because I cannot pay much more. I know I can snowball, but it will take a LONG time. Some have suggest bankruptcy since I can be out of debt and CR cleaned of BK faster than paying all back.

But approaching this individually--
I can leave 15K Penfed debt--2.99% is fine
Citi 9k @ 5.74 % is fine b/c rate will be the same once card is closed.

So that leaves other 19k and Auto Loan.
I have 2 years left to pay off loan. Provided car lasts (it's well maintained but 75k already) that will free up $460/mo. But it is 2 years.

Then I have 19k with relative high interest.

Am I looking at this the wrong way or is there a debt consolidation method I don't know about?

If you can make the payments on everything [no crisis]...why does it matter that it will take a "LONG" time?

You didnt get into debt overnight, so you can not expect to be out of debt overnight pending winning the lottery or other $$$ winfall. I dug out of $30K of debt in about 2.5 years and used that time to develop the discipline needed not to get back into debt and maintain my financial profile for the long term. Now I respect my money and its management.

Its a marathon, not a race...buckle down and set small goals, roll into larger goals and before you know it, its all behind you with the fruits to show for it. Ask as many questions as needed as this Forum is a great resource! Good luck!

I agree with OHO. The best way to tackle it is one debt at a time. Around June of 2006 I owed more than you do now. I had paid the last of my creditors off in full in December of 2008. I cut my expenses to where I was living on as little as realistically possible, got a second job, and made my goal in life to be debt free. It was hard, and it sucked, but the only debts I have today are low interest student loans. Its a nice situation. My lifestyle now is a bit more lavish than it was in my debt repayment days, but not by much. The bulk of the cash that was previously going to debt payments and interest is now working for me, earning interest and dividends, and the balances are increasing at a very rapid rate.

I paid the highest interest debts first (mostly, I was on a payment plan to pay off a judgement in an effort to avoid garnishment). Your rates are all quite reasonable, but to assess what to attack, we'd need to know your credit goals. Once that citi card closes, your util is going to go way up, which is going to hurt your scores in the short term. If you don't need your scores for much in the near future, I'd pay the minimums on that, and pay down higher interest debt in the meantime.

Well, i should add that I have 3 dependents (2 small children) and a financially unconscious wife to deal with, so some people cannot always control $ flow as easily as others. In addition, my wife is having her hours cut back thus reducing income.

As I said on my OP, we are at the edge of cutting back any more than we can. Other than increasing cash flow from new job, there is no way to pay much more than minimum due on these cards. Sorry, can't wait until 2033 to pay them all off, and it did not take me that long to get into debt.

My primary goal is to become totally debt free within 5 years time and clean CR. I don't care what happens meanwhile as I am renting and not planning to use my credit standing to apply for any loans for some time. I promised myself never to hold a balance on CC again.
After that, any $ saved will go mainly towards college funding.

If I have to, BK will be on the table unless otherwise convinced I can pay within 5 yrs.

Sounds to me like you've already decided you're filing bankruptcy, and are only seeking encouragement from the board.

I think changing your wife's habits is more important, long term, than your current debt. In a way, your current line of thought is only going to reinforce her behavior.

If I solely were using this board to make my decision, I would be in deep trouble, so no, I am not looking for encouragement to file BK, rather am trying to gain as much factual data together as possible (before deciding to even speak to a BK lawyer) whether it makes more sense to file than to pay back based upon TIME.

As for my wife, once I have solidified the future financial plans, if she still chooses to not listen and not participate towards progress it will be dealt with separately since I ultimately control the finances. There is no doubt this pattern of financial lunacy must stop.

OK well, to each their own...but if you decide to file for BK which I think remains on your file for 10 - 13 years and you mentioned college saving...I hope the kiddies are either not close to entering school or can amass grants & scholarships to fund....more importantly, if short, do not need your help with securing reasonable student loans.

There isn't a secret debt consolidation method you don't know about, unfortunately. Your rates are already in the ballpark with what you'd get in a DMP plan, so that consolidation method isn't going to gain you much either. That leaves paying, walking, or BK-ing.
If you can "adjust" your budget somehow, or increase your income enough to snowball the debts in a reasonable amount of time, that'd be something I'd consider first.
If that won't work and you are faced with a decade or more of living on the edge, making slightly-more-than-minimum payments, BK starts looking like a reasonable alternative. It would likely be faster....but at the cost of your credit. Heavy damage for a couple of years, followed by 10 years or more of having that shadow follow you around.

First thing do do, as I'm sure you are already aware, is to make sure both you and DW are on the same financial page. You'll not make much progress if you are digging while she's shoveling back in.

Good luck, I hope that whatever you decide works out well.

It does sound like you have made up your mind on what you want to do. You just want to take the shortest route possible which is BK.

1.) You can try and take your three higher debts and see if you can get a loan with Lendingclub.
2.) You have good credit scores you can see if Penfed can do a CLI so you can BT more debt to that card.
3.) Get a roommate or find a cheaper place to rent.


I don't know this is just my thoughts.

I would agree that, there are probably several ways that you could significantly cut your costs and put that savings towards your debt. However, until you and your wife are equally committed to solving the problem, you are going to be taking a step forward and two back.

I'm not sure what area of the country you are in but $1875 sounds high for rent. Utilities, cell phones, etc. should all be scrutinized. Start a spending diary and include EVERY dime you spend. You'd be surprised, how a couple of drive through trips with the kids can add up. Your rates are good now, but in these days rates are getting jacked, minimum payments are being doubled, etc. and it sounds like you guys are living "on the edge".

Do you have an emergency fund? There are so many variables to consider in making your decision, I know it must be making you nuts.

Bankruptcy, while it may get you out of debt in a short period of time...it will stick with you for 10 years. Many of your creditors that you IIB will blacklist you and it will be a long slow and frustrating process. If it were me, it would be my last possible choice.

Good luck, whatever you choose.

w00t for selling eggs

That car payment seams really high... maybe you can refi?

What are you 'min expenses?'

Filing BK will not solve some of the problems that got you into debt in the first place. As Radi 8 already said,



If you file BK, you will find that your DW will be able to obtain credit in no time at all. You could find yourself in the same boat as you are now. Only this time BK won't be an option.



Okay, so you ultimately control the finances. Start doing so now. Lay down the law. Cut up some cards. You need to stop the bleeding.

Signed,

AaaaaaAAAaaaaaaaaaaaaaaaaaaaaaagh my eyes!

Ugh, what an awful image. I hate DR with a passion. Such a douche.

If OP's DW doesn't have much discipline when it comes to spending, there's nothing wrong with cutting up her cards - he can shred them and still keep the accts open.

True, very true. I've seen a couple of people go down the tubes financially because of a spendthrift spouse or partner.

LMAO @ Radi!

LBCS, hate is such a strong word. DR doesn't hate you. LOL.

Well, let amend the statement. I passionately hate the crap that DR preaches.

Then why does he want me to waste money and have bad credit?

LOL. He just wants you to have CASH!!!

I guess the photo is a suggestion that the OP PAY to join the NUTBAR website and BUY a bunch of the NUTBAR's tapes and books.

Nope, just a suggestion that he cut up his cards!