Personal Finance Advice

[buffalosoldier]

Hello,

I need some advice. I'm drowning in debt and I don't know where to turn. My debts include:

Car loan: $10,000
School: $ 5,000
Personal loan: $11,000
Credit cards: $ 3,000


My income is $2500 per month after taxes. After my minimun payments and rent and food, I'm broke. Help!

[ExtraSlow]

a couple of easy questions to get you started.

- What is the car, and how badly do you need it?
- Is there any more room on the personal loan, and what rate is it at?
- Where do you live?
- is that "school" debt a student loan? If so, have you looked into the forgiveness options on that?

[Twin_Cam_Turbo]

First step, sell your car and buy a cheaper reliable car like a 90s Civic.

[Sugarphreak]

...

[realazy]

Some suggestions and questions for you:

Always pay off credit card debt first as it's usually the highest interest. Is this one card or multiple cards? Some credit cards will offer balance transfers at introductory rates (5-8%) for 6 months or so, that can buy you some cheaper interest rates for a short time.

What are the actual payments for the car loan and personal loan? Details about the term and interest rates would be useful to help you prioritize.

I'm assuming school means tuition and that is a lump sum that is due? I'm not sure how long the school will let you keep a balance or how much interest they charge.

Do you have ways to borrow money at a lower interest rate than the current loans?

[ExtraSlow]

That's his net, not gross, so he's making ~$24 per hour, assuming he works 40 hours a week. But income is not the issue here.

[Modelexis]

Originally posted by ExtraSlow
- What is the car

The answer to this is below his username.

[buffalosoldier]

Its actually much worse than I indicated. First, I owe more on the car than it is worth, so I cannot sell it. Second, the personal loans are not from a bank so they are at ridiculously high interest rates. Finally, I tried to go to a bank to consolidate my debts, but I was denied due to bad credit. Should I file for bankruptcy?

[dirtsniffer]

Hopefully that's not the car.. haha.

Here is what you do OP. But I doubt you will

Get some room mates or move back in with your parents

Cancel your cell phone, cancel you cable, don't eat out, quit drinking, cancel your gym membership, stop buying luxury goods.

Try to get more hours at work; if not possible, get a second job

You put yourself in this mess, it's going to take some personal sacrifices to get out of it.

[Yuubah]

talk to your bank, get a consolidation loan. cut up all your credit cards.

start paying back all your debt.

what did you take in school? get a higher paying job if possible

[dirtsniffer]

probably basket weaving.

jokes aside. maybe OP had some bad circumstances that led to this situation.

[Twin_Cam_Turbo]

$2500 a month after tax and you can't start to pay this off? No wonder you have bad credit.

[Masked Bandit]

You're not going to like this but get a second job and start living the cheap life. Drink beer at home, not at the bar. Brown bag the lunch, not going out. Make coffee at home before you leave the house, not stop at Timmy's. Make debt repayment your #1 priority and you can get it done.

[FraserB]

How much are you paying for rent?

For food?

For utilities?

[E46..sTyLez]

Buy a giant bag of rice...that will reduce your food costs substantially.

Honestly though man, don't file for bankruptcy. You will regret it for the rest of your life.

[Mitsu3000gt]

Move back home, wherever that is. I bet your rent is eating up at least half your net income. Or get some roommates.

Get a ~5% unsecured line of credit, use that to pay off CC debt, and pay 5% instead of 18.5% going forward. Banks hand these out like candy, however I don't know the details of your credit situation.

Why the hell are you driving an Impala SS? Get rid of that ASAP, pick up a $1000 Civic or take transit. Your gas costs are probably more than any of your minimum payments.

Get another job as well?

Some pretty good advice in here already, what you need to do is pretty obvious, and it won't be fun for a while.

Can your parents bail you out? If they are like most people they have access to credit at 3%. Transfer your loan to them, cut up your credit cards, and begin a payment plan?

[buffalosoldier]

Thank you for the good advice and positive words ExtraSlow, realazy, Masked Bandit. I did not appreciate the negative comments from Twin_Cam_Turbo, Sugarphreak, Modelexis

[E46..sTyLez]

Is your car loan actually secured by your car? Cause if you have no lien on the vehicle, you can still sell it even if you owe more than it's worth.

You would just need to keep paying off the balance, which would be much less if you put the proceeds of the sale towards the loan...wish I could offer more advise. Good luck to you

[FraserB]

Originally posted by Mitsu3000gt
Move back home, wherever that is. I bet your rent is eating up at least half your net income. Or get some roommates.

Get a ~5% unsecured line of credit, use that to pay off CC debt, and pay 5% instead of 18.5% going forward. Banks hand these out like candy, however I don't know the details of your credit situation.

Why the hell are you driving an Impala SS? Get rid of that ASAP, pick up a $1000 Civic or take transit. Your gas costs are probably more than any of your minimum payments.

No one is going to give him a LOC after he was turned down for a consolidation loan and he probably can't sell the car since he is underwater on it and doesn't have the cash to pay the balance.

Parking the car with bare minimum insurance would be the best idea. Saves him insurance money and gas, which can be used for a bus pass and debt payments.

[DeleriousZ]

Lower your standard of living, grind through living in a shack eating cold noodles for a few years.

Bankruptcy is a brutal mark on your credit, take every other option you can before doing that.