Credit card interest rates

[apryllraye87]

So, when hubby was 18 he decided it was a good idea to charge up a bunch of debt and then never pay it back. This resulted in several credit cards and unpaid medical bills being sent to collections and his credit was ruined.

Fast forward to 21- since he had such bad credit he couldn't get approved for any more cards (not that he needed them) unless the interest rate was insane, but hey who cares about that! He maxed out 2 MORE credit cards which now have 30% interest rates.

Then I came into the picture and needless to say he is no longer allowed to have credit cards. I manage ALL of our money since he obviously can't. So we have set up payment plans and everything in collections is now paid off and we're working on the current stuff. Anyway- we don't have loads of extra money to pay on his debt and since we have so many little things to pay that he owes on (7 to be exact) the minimum payments of $50-$100 a month add up, but since the rates are so high we aren't getting anywhere because payments are virtually all interest and almost no principle.

Is there a way that he can "close" these cards and continue paying but have the interest reduced at all? He can't get approved for a card with a lower rate, and I'm not putting all that debt in my name and ruining my credit so I don't know what else to do. I've heard that some companies will lower the rate if you close out the card but keep making payments, but I don't know how to do this?

[nevaehsmom327]

Have you looked at doing any consolidation loans? Usually places will consolidate them all and give you one loan from it all. I honestly don't know a whole lot about it, but it might be worth checking in to.

[apryllraye87]

It probably wouldn't work because he has horrible credit so I doubt he would get approved for anything, and I'm not putting all that debt in my name.

There are some companies that will consolidate but they charge a lot of money to do it and I'd rather not pay even more than we already are.

[merrr]

Call each credit card company and ask them to close the account - explain the situation. The worst that they can say is no!
I feel your pain... I was 18 and didn't understand the long term effects of a credit rating either.

[apryllraye87]

Luckily for me my parents are all about credit so I learned early on not to mess it up.

Unfortunately for Mike his parents were the complete opposite and never cared about credit. Hence our problems today

But he's learning at least. The sucky thing is we can't buy a house until his credit is good and I'm so impatient!

[AuntSueto4]

I found an even better place to check out, and it's FREE!!!!!


LSS Financial Counseling Service [by Lutheran Social Services]


"Free and confidential budget and debt counseling"


www.lssmn.org/debt/

[apryllraye87]

Thanks AuntSue! The only thing I'm worried about with those is that we'll still have the high interest rates. Because the accounts still stay open, it isn't likely the rates will be reduced.

But I'll look into and see what they have to say!

[mickeymk]

I have heard that you can call them and tell them you can no longer afford the payments and that typically they will reduce rather than have it go to bankruptcy. It wouldn't hurt to try.

[AuntSueto4]

Jan 20, 2012 13:49:10 GMT -6 apryllraye87 said:

Thanks AuntSue! The only thing I'm worried about with those is that we'll still have the high interest rates. Because the accounts still stay open, it isn't likely the rates will be reduced.

But I'll look into and see what they have to say!

You're Welcome. I would check it out, about the high interest rate, because it may be negotiable, the worst they can say is no, but they may say Yes too and help you.

{{HHUUGGSS}}

[Susan824]

In my career, I respond to Attorney General complaint cases for credit issues/credit product debt.

Most credit card companies do have Special Payment Plans, but it’s up to them who they offer them to and when. I can share some extra details, but not online. Look for a PM from me.

You’ll want to avoid Debt Consolidation Companies, no matter what. Their tactics may reduce some debt, but not without creating additional, long-term, consequences on his credit report. Main point - they charge too much for their “services” and they can’t guarantee results. It’s a scam, often violating federal law. The Federal Trade Commission (FTC) has been aggressively making them pay restitution. However, there are some reputable non-profit organizations that provide personal debt management advice at no charge. They’re legit (recognized by the FTC as being consumer advocates). I’ll send a PM. There are a few options for you.

(Sorry for the length of this post, but I'd like to see a better outcome for you and your husband). Way to go on demonstrating integrity and persistence in paying down his debt!!!