I guess I should explain this business better in order for you to understand why there is a loss of $4000.00 each month. There is nothing we can cut out to avoid this. We simply must grow the business. We are publishing a real estate book that is a free publication available in all grocery stores, convenience stores, restaurants, etc. Our income is earned from realtors, builders and mortgage brokers buying advertising in our book. The cost of printing these full color digest size books is spendy, not to mention the cost of racks, the cost of paying to be on certain racks (grocery stores have a contract with a distribution service and we have to pay the distribution service), shipping of the 25,000 copies from Portland, where they are printed, artist fees for designing the ads, etc. There is absolutely nothing to cut for the business at this point. We bought the equipment we had to buy up-front (Computer, fax, etc.) but have not splurged on nice office furniture, new vehicles or any obvious mistakes. I run our household very lean also. We do not want to borrow more, as we are afraid it will be too hard to ever catch up. If we progress at the rate we are moving now, we will eventually earn a decent income, but in the meantime our hard, unchangeable business costs are significantly greater than our earnings. I would love for DH to be able to work less, but am not sure how that can be done. He is a paramedic in a supervisory capacity. There isn't enough job security as it is to be able to "dicker" with them on hours. If he went part-time he would lose all benefits. We simply cannot risk no insurance for a family of five. I have been a powerseller on ebay for several years and also have a booth selling antiques. It is a great way to earn quick cash, such as in times like now, but of course also takes time. The antique booth is not very time consuming, but it also earns much less than the ebay. I spend many hours each day handling the production end of the publication . . . getting photos and listing info. from realtors, instructing our artist with design specs., proofing and editing text. I just don't have the time to go out and sell the advertising too. When the publications come out, DH and I distribute all 25,000 ourselves, rather than hiring that out, as that isn't feasible. That is very time consuming, not to mention the gas and wear on our cars! When I do ebay, I do it late at night, so that it doesn't interfere with the business or the kids, so it isn't like I can just swap ebay time for this business time, as I must operate during realtors business hours. We are seriously looking at putting the boys in school in the fall. I just don't want them to get the scraps" of our time. DH spends most of his off time on the business, for example spending over 8 hours today doing cold calls and setting up appointments. We are seeing growth . . . just slower than what we need given the debt factor. This is a rapidly growing publication throughout the Northwest and all the publications started in other towns prior to ours have grown rapidly and are now showing a profit, so we are no where near walking away from this. I just am not sure what we should do in the meantime. We have used up our HELOC and visa. We can get more credit as we have an excellent credit rating and we have checked into it. It is just the fear of borrowing so much that it will take forever to catch up. So I guess I am wondering, if you were in our shoes and knew that within a year, two at the most, you can probably be earning a 6 digit figure, would you keep borrowing or what would you do? Thanks. Brenda

If you wanted to refi the entire amount, (325+42), that puts you at about 81% LTV. But, that's based on the assessment, not one an appraiser would give you. And, that doesn't include closing costs. So, while that's probably a good estimate, I'd find out what homes in your neighborhood are selling for. Foreclosures have killed so many refi's no matter what credit rating people have. It's sad but true. And, if you do have to end up with a full refi, you don't want to get stuck needing a few thousand dollars. I do think your best bet is to get the modification done first and hope you don't have to do the full refi. Once that's resolved, then you can get rid of those credit cards :) Good luck!

What did she "pay" ... well, "agree to pay" for her new car when she bought it two years ago? And how much has she paid over all of those months between then and now? And how much does she still owe? If she goes to buy a new one, how much will the dealer allow her as trade-in on her current car (with the less-than-attractive side) as reduction in price of the new one? She'll be astonished at the amount that the dealer will allow her as trade-in on her car with the caved-in side when she goes to buy her new car. I'll bet that it'll be less than she still owes, probably quite a bit less. So that, if the new car's price may be, say, $18,000. ... ... she may end up owing something like $22,000. on her new loan. On the new car that she paid $18,000. for ... ... but now, even if only a week after she bought it, and without a mark on it, would be worth probably about $14,000. Two thirds of what she owes? Not my idea of a good time! Would she listen if you drew a set of patterns for her, showing (with approximate sizes relative to dollar amounts), of what she paid for her current car, how much she's paid over the 24 months, how much she still owes, how much difference there is between her cost, what she's paid, what it's "worth" now as allowance toward an upgrade, etc. And showing how she's paying so much monthly on her student loan, so much monthly on her car loan, splitting those two payments into principal repayment and interest components, running the interest stream off the edge of the paper, as lost. So - she's working about half of her time monthly for ... ... nothing. But - currently, she's not working, is she? So how does she make car payments? How long before they may repossess it ... ... leaving her walking. Which wouldn't happen if the loan was all liquidated. Working much of her time - to pay someone else rent for the use of their money. And as long as she uses other folks' money ... she'll have to pay rent on it. Which is money that could have stayed in her pocket, had she driven the nearly new car (with the stove-in side) longer ... ... until she's paid off all of the money that she'd borrowed to buy it. Which would mean that the amount that she would be allowed at trade-in would be all hers, instead of mostly (or all - or maybe even more than all) going to pay off the loan that she still owes on the current car. Which would mean that the amount that she would have to borrow on the new car would be much lower. So - if she were paying the same amount per month ... the loan would be paid off in short order. Then she could keep putting that amount away (or most of it) to pay off her student loan faster. Could you draw comparable sized boxes to the amount of value that each item is, with labels, and the proportion of it that's hers, etc.? When we get stuck in a snow bank, we can do a lot of spinning wheels back and forth, with little result. Except burning a lot of gas. Wear and tear on tires. Wasting time. And, if we're not careful, when using an automatic transmission, burning up the transmission. And getting where? Nowhere! And getting not just ourselves, but people sitting in the car with us, more than likely, somewhat bent out of shape with irritability. Smells a lot like this situation, doesn't it? Just some thoughts. Or ... would you call it my whine? ole joyful

Abbey First congrats on getting your credit paid off and in control. As for your friend she needs to RUN not walk away from these people. there is no "secret credit card program" This is one of the dreaded "settlement" companies I have spoken of in a previous post. this is how they work: they tell you to stop paying your credit card bills and send them a certian amount of money each month. When your "account" with these folks hits a certian ammount(less the money they have taken for their "fees") they will then go to the creditors and offer them 50% of the balance to settle. If you friend is not late the chances of this happening is very very slim. What they don't tell you is credit card companies look upon these companies as a industry "joke" also what they don't mention is not paying your bills will result in late fees and negitive reports on her credit report. They also can't promise that the credit card companies won't "sue" her. When I worked for a major credit card company and we would receive these "settlement companies" letters we immeditally would send the account to the litigation dept for review. If there were any assets like a home or accounts that were being paid we would proceed to get a judgement against the debtor. Another thing they don't mention is any settlement over $599, is reported to the IRS so for example: Balance $10,000 settlement $5000. the $5000 that wasn't paid is reported to the IRS and your friend would have to report this as income there by raising her taxes. finally should your friend decide that the collection calls and possible litigation is not worth it, the damage she has done to her credit report will remain for 7 to 10 years allot longer than going the CCC route. there are no "magic" quick fixes to getting out of debt other than a good repayment plan. You are the best example how well ccc can work that is where she should be going Karla p.s. sorry for any typos but it is 5:30 in the morning lol