Paying off credit cards: questions.........
castlequeen
17 years ago
Featured Answer
Sort by:Oldest
Comments (16)
sharon_sd
17 years agoHappyladi
17 years agoRelated Discussions
Credit Card Payment Question
Comments (9)The mortgage company makes even more money when they sign you up for those twice monthly payment schedules. My MC sent me a letter about that and the enrollment fee was also $300. But the two payments added up to more than my present monthly payment. Their explanation was that a partial payment resulted in 14 days additional interest being added to the total monthly payment. But that plan isn't designed for someone who can afford to make their monthly payments. It's designed for folks who are on fixed income, have all of their bills coming out of their accounts on the first of the month and don't have enough to cover the one big one (the mortgage) all at once. For some people it can be a Godsend. However, you do (they do) wind up paying more over the long haul. The mortgage company doesn't want you to pay off your loan early, because they make money on the interest that you pay. Likewise they cannot tell you not to send additional principle with your monthly payment. This information is in your original loan documents, but if you don't understand them yourself, get a lawyer to explain it to you. Your bank actually may have someone who will look at it and explain it to you free of charge. And yes I do all of my banking and bill paying on line. All the banks' on line bill paying systems are similar, so it's actually not difficult to change banks if you get better service from one than another. The best thing about paying bills on line is that they post on the date that you specify when you send the payment. If you mail a check, you never know precisely when it arrived, all you will have is the cancellation date stamped on the back when the mortgage company posted it. When you mail a check, the mortgage company can claim they didn't get it by the due date and charge a late payment penalty. Banks and mortgage companies routinely post debits in the morning and credits in the afternoon. So if your account has $100 on Monday, then you make a deposit of $50 Monday afyternoon, you won't have a balance of $150 until Tuesday afternoon. But if you leave the bank and go pay your light bill for $101 on Monday afternoon, your check will bounce on Tuesday morning. Then you owe the bank the $25 overdraft fee on top of everything else. So what I can't figure out is if banks are supposed to be so good at managing money, making money and gouging money out of Jane Q. Public, why are Janes tax dollars being used to bail out the @#(*&@# BANKS?????????? I think if a business is such a poor manager of their assets that they go broke, why would we want to help them stay in business? It's the taxpayers money that they have squandered to get where they are right now, why does the government want to give them some more? OK, I'm hot about this bailout program and while the President is a compelling speaker, I'm not convinced that this is going to help the country at all. And using tax dollars to shore up private business is wrong. Maybe I'll start a business that will provide a service to every American politician: An Iron-Clad Guarantee to Go to Heaven. They only cost the individual politician 1k and then he/she can do anything they want to for the rest of their lives becuase they know they will spend eternity sitting on a cloud. This is an essential business to America because right now there are only 7 politicians in heaven, and none of them are Americans. We want our politicians to be represented in heaven, so I figure they all need one of these guarantees. So if Congress grants me 1.2 billion dollars, I will issue enough guarantees to cover all our major politicians and many of the minor ones. I might even be able to cover some of the ones who are in prison right now. Course I'm going to need a bonus (like the big bank bosses got) and a nice hotel to live in (like Dallas mayor wants to build) and a corporate jet (at least as good as the one Lee Iaococa has) in order to complete my mission. Yeah, I figure 1.2 billion should cover it. But first I'm going to register myself as a minister of a church (that would be the church of IDM) so I don't have to pay any taxes anymore....See MoreHome Equity Loan to Pay Credit Card Debt
Comments (12)One of the biggest problems with any scheme to pay off credit cards by using more credit is most people do NOT change their spending habits. The average consumer will take out a home equity loan to pay off outstanding balances and then only 2 or 3 years later find themselves with a home equity loan and credit cards at their max again. That doesn't solve the problem; it makes it worse. Plus there is the potential to lose you home if you fail to make payments on the home equity loan. In my humble opinion, this is not the best solution to your problem unless you and your significant other make some changes in your spending habits. Switching from one low/no interest credit card can be very damaging to your credit score. One of the components of a credit score is how long your current accounts have been open. Longer is better. New credit cards every 6 months will lower your score which means you pay higher rates or cannot qualify for those "teaser" rates. Also, be aware that the teaser rates will escalate very rapidly if you are ever late with a payment. The solution that I suggest to the personal financial management classses I teach is to stop using credit cards for any daily expenses. Save them for emergencies (a death in the family, an earthquake destroys your house, a hurricane is coming and you have to evacuate). Concentrate on paying off one card by paying extra on that card every month but continue to make the minimum payments on every card you have. When that card is paid off, apply that payment to the next card until it is paid off. If you have trouble avoiding temptation with credit cards, put them in a ziplock bag and seal it. Put that bag in another bag and fill it with water. Put both bags in the freezer and leave it there. Anytime you need a card it is available, but you have to wait to thaw it out to use it which means you have time to think about whether or not you really, really NEED what you plan to purchase with credit. While it sounds "dorky" and simplistic, it does work. Good luck...See MoreShould I liquidate assets to pay off my Credit Card debt.
Comments (5)Here goes with my financial advice. I believe it's simpler than it sounds and just requires you to get your interest rates from all of your accounts in order to make your choices. First suggestion: do as celticmoon suggests and fix that $515K first mortgage immediately! As I'm sure you're aware, the fixed variable rates of now are worse than a year or two ago, but much better than the 12-19% that they were in the past. In my opinion, fix it now and pay for any closing costs out of your savings, which is presumably earning the worst interest rate. Speaking of....what savings rate is your $15K earning? If it's less than 9% (almost a sure bet), and you have liquidatable cash in assets (which you say you do) to cover an emergency fund, then using that cash to invest in your house is giving you a 9% rate of return in your house investment, which is far better than the 3-4% of a typical savings account. If you choose not to do that, then I present my second suggestion (which I still think you should consider, w/ or w/o the $15K in the equation) DH and I just went through a similar process, although with one house, and we paid off a motorcycle and a timeshare (each at ~9%), rather than CC debt. This plan mirrors our own, with different dollar amounts: Roll both HELOCs into one and LOCK your rate up now. In my opinion, it's only going to go up. You should be able to get a much better rate with a higher consolidation balance (we got 7.5% by consolidating our two loans along with our original HELOC). 65K + 30K = 95K = 11.9% of the first house or 19% of the second house. If you keep your loan:value ratio below 20%, you'll get a better deal on rates. You may even ben required to keep it below 20%; I'm not sure. Keep thinking about that. The next option is to add the 25K of CC debt into the HELOC figure, for a total of 65K + 30K + 25K = 120K = 15% of the first house. Close that loan and pay off the CC debt immediately. You're now transferring the 8.9% of wasted CC interest into an investment into your house, in addition to the tax writeoff. The last think to consider is to stick with the 95K HELOC option and pay off the CC bill with your assets. Are any of your stock or mutual funds giving you returns better than 9%? If so, then keep them where they are and do the 120K HELOC option. If they're earning less than 9%, then I refer you back to the concept of my second paragraph. If you take your mutual fund money that is earning less than 9% and pay down your worst mortgage/HELOC/CC rate with that, you're making a huge investment in your house. Now, if you want to sit on your stocks, that's understandable. I hope that my advice not confusing, and that it's helpful to you. Lindsay...See MoreReclaiming funds from my brkn eBay chairs-PayPal or Credit card?
Comments (24)Geez, what a nightmare. Why can't people just be honest and treat others like they'd like to be treated? I just don't get it, it's not that hard. I really wanted to bid on some beautiful RL bedding, a rare style, but I really had to read between the lines and push to get info. Apparently with the shams the seller mentioned although never used, she did launder one "by mistake", but it went right back in the package. Saw no logic in that whatsoever... Since it was cotton and lace (delicate), I wondered if she dried it (which would ruin it). I emailed her asking if the washed sham had been distorted or shrank as a result. No reply. I wait a few days, auction is nearing and end, and basically email her a 'hey, I'd really like to bid, but have not received a reply to my question so I'm giving it one more try here.' That generated a response from her, she admitted that the laundered sham was 'snug' and corners 'curled', but suggested ironing would make it fit properly again. Good grief. (She failed to include that significant detail in her description, even after I asked, she didn't post my question and her answer.) Very cat and mouse. I'm glad I took time to push it, because although it was a beautiful set I might well be out the $, and it would be worthless with only one good sham (and it garnered pretty high $$). I'm watching to see what kind of feedback occurs once the buyer receives it. Anyway, back to valinsv's guy. Clearly there are major issues with some items he sells. Is he too ignorant to realize that having integrity would only bolster his business that much more? That's the part I just don't get. Treat people right, they'll keep coming back. Treat them badly as a habit and sooner or later he's going to lose. Seems to me with the type of volume he does he'd be a lot further ahead if he'd just be honest. Just curious mona if you might know: if he does get kicked off, is his IP address banned, or just his ebay ID? He seems to have such a huge system set up and selling high volume, can't see him just walking away. Could he just come back under a new ID? (Although given his business and volume and listing style, it would be easy to recognize it might be him.)...See MoreGina_W
17 years agosaphire
17 years agomyfask
17 years agosharon_sd
17 years agoC Marlin
17 years agohousenewbie
17 years ago3katz4me
17 years agomyfask
17 years agorich69b
17 years ago3katz4me
17 years agomyfask
17 years agobusymom2006
16 years agobusymom2006
16 years ago
Related Stories
VACATION HOMESMake Your Vacation Home Pay Off
Renting your vacation house when you're not using it makes good financial sense. These tips can help
Full StoryVACATION HOMESPatience Pays Off for Owners Renovating Their Beach Condo
A Jersey Shore unit gets a bright new look, a more functional layout and increased space for extended family
Full StoryMOVINGHow to Avoid Paying Too Much for a House
Use the power of comps to gauge a home’s affordability and submit the right bid
Full StoryWORKING WITH PROS12 Questions Your Interior Designer Should Ask You
The best decorators aren’t dictators — and they’re not mind readers either. To understand your tastes, they need this essential info
Full StoryORGANIZINGPre-Storage Checklist: 10 Questions to Ask Yourself Before You Store
Wait, stop. Do you really need to keep that item you’re about to put into storage?
Full StoryMOVINGHiring a Home Inspector? Ask These 10 Questions
How to make sure the pro who performs your home inspection is properly qualified and insured, so you can protect your big investment
Full StoryWORKING WITH PROS10 Questions to Ask Potential Contractors
Ensure the right fit by interviewing general contractors about topics that go beyond the basics
Full StoryGREEN BUILDINGOff the Grid: Ready to Pull the Plug on City Power?
What to consider if you want to stop relying on public utilities — or just have a more energy-efficient home
Full StoryMOST POPULARHouzz Tour: Going Off the Grid in 140 Square Feet
WIth $40,000 and a vision of living more simply, a California designer builds her ‘forever’ home — a tiny house on wheels
Full StoryREMODELING GUIDESFinish Your Remodel Right: 10 Tasks to Check Off
Nail down these key details to ensure that everything works properly and you’re all set for the future
Full StorySponsored
More Discussions
myfask