What would you consider good debt? I have a loan from the bank for my wife's engagement ring and a separate loan for our car. I consider these good debts because when I did an analysis on what would happen if I paid off these two debts, my credit score actually went DOWN. BTW, there is another way that Luckyazn can pay off his debts. A lot of illegal Asian immigrants actually do this. Basically you form what is a savings club with a group of people (the bigger the better). Each month everyone contributes a set amount of money, and lends it to one person in the group (you only get to borrow it once). Everytime someone borrows the money, they have to pay a portion of the set amount for everyone (if the set amount is $500 per person, the borrower would have to pay something like $50 or more for each person who has not borrowed the money yet depending on what was agreed upon). If two or three people want to borrow the money for that month, then they put in bids for it. One person might offer to pay $75 for each person, and another might offer to pay $100 for each person. Highest bidder wins and gets to borrow the money that month. If noone wants to borrow the money in a certain month, then a random name is selected to borrow the money and he/she will still have to pay a set amount for everyone. Of course, if you borrow money early, then you would have to pay a fee for eveery person who has not borrowed money yet. If you are the last one to borrow the moneym then you would not have to pay any fees. Once everyone has borrowed the money once, the savings club is dissolved. You probably know some people who do this, ask around Chinatown or whereever. Just make sure you are with people you know and trust, it's a big sum of money. We knew some people who were in savings clubs that lent out $75k per month to the borrower.
hmm actually, the OP says it i all credit card debt. tested's got a good point, how does his credit score get that high?
there are good debts and bad debts. I am currently borrowing 0% interest 0% balance transfer loans from CC and putting them in CD or Money market. at 5%-6% return borrowing as much as I can, my mom actually borrowed over 60K! that's like over 3000 bucks a year in return. Oh make sure you pay it off in full when the 0% is up!!!
Yeah, I've heard of people doing this. Forgive my ignorance, but can you explain how you do this? Are you opening up CC's with introductory interest rates, then using a cash advances from them to open a CD? How long before the CD you're opening matures? Are you paying off the CC at the same time the CD matures?
No I'm only making 40k if it was 300k I would have my debt paid off pretty quickly ... the past 4yrs Ive just been applying for alot of 0% intro apr rate and kept on doing balance tranfers onto those so even though the balance are 35k the limits on all the 13 cards are 110k. Thanks guys for the advice so I guess the Debt Consolidation thing is NOT AN OPTIONS since is a negative thing on my credit and it sounds more like a scam. I guess I'll just have to stuck it up these next yrs and work on it one by one slowly.
I'd love to play this game too. Can you break it down for me? How does it effect taxes at the end of the year?
alright...I can't believe that noones mentioned Dave Ramsey yet. He's a debt/financial guy with a best-selling book and a nationally syndicated Radio Show. Buy his Book "Total Money Makeover" as soon as you can. It will change your life. It's all about the basic money principles that your grandparents lived on. You can also check him out on his website www.daveramsey.com Download yesterdays podcast and listen. Basically, you should make a written budget each month. List everything You are going to spend money on, and how much you spend. Start with the basics, food, shelter, electricity, etc. Follow the Budget.(this is the hardest part for the first few months-it gets easier after that though). You will notice that you spend a lot less money if you follow a written budget each month. Then you'll have more money to pay off your debt. DO NOT USE credit cards ever again. Before you start to pay off your debt, save a $1000 in a savings account for an emergency fund. If your car breaks down, use this money instead of credit cards, then replace the money as soon as you can. Then make a list of your debts, smallest to largest. Pay the minimum on EVERYTHING except the smallest debt. Pay as much as possible on the smallest until its paid off, then begin applying that amount (plus the minimum you were paying) to the next smallest. When you do this, you pay off your bills faster, and you see results faster. It makes you actually feel better when you pay off one of the cards...even though its the smallest. Close the account as soon as its paid off. You do not need a credit score to buy a house...that is a lie. You can always find Banks to underwrite a loan. Meaning, they look at you and your finances instead of a FICA score. Live your life to this one rule. If you can't pay cash for it now..you don't need it. When you have NO credit card debt...you have lots of cash to buy things (and invest wisely, and be wealthy). Good luck, remember, being in debt just means your normal. But hey...who wants to be normal when you can be rich down the road? oh yeah..I think you can listen to Dave Ramsey on KTRH AM radio in Houston. Don't know the times though. He's live here in Dallas from 1pm to 4pm every day.
Well, I pay just about everything from my regular CC card with money back, at the end of a month, I transfer money from the 0% interest CC to the regular CC. Then I put the money I saved from the bank into something like ING or HSBC for 5% interest, at the end of the 12 or 11 month, I take the money out and pay the CC card or rotate to a new one. I have been doing this for two years. Sometimes they also give you 1.99% cash advances which you can then put into CD or HSBC accounts again. Make sure that the % of CD or HSBC is higher then the % CC is giving you, make sure to check if they charge you the 3% transfer fee, as that can really cut into your earning. This money you should not use to buy things or stocks, just put it in a safe account and watch it grow, It is beautiful to see it work. At the end of year you pay tax on these as your regular interest.
i dont buy this statement...you do need a credit score unless you are putting 20% down....which in that case you should have good credit...
Remember the interest you earn from the ING accounts are subject to regular income tax. Where the interest/fee you pay to the credit card company are not tax deductible. So the numbers might not be as attractive. The current short term rates are much higher than couple years ago, so I'd be surprised if the zero% credit card teaser rate is going to continue for much longer.
We have about $15k in debt right now. With what I'm making and what my wife makes, we will be able to be out of debt by September as well as put quite a bit a way into savings. All it takes is some self-control in our case. I cannot wait until I make that last credit card payment.
Because they are the worst people in the world to deal with. If you ever get ripped off or someone steals your credit card or anything, CaptalOne will make every effort to pin the blame on you or someone you live with, which means they won't have to eat the loss and are able to pin the bill on you. If you fight them (as my mother in law did), they will report you to the credit agencies for failure to pay and your credit score will get lowered because of that. The company is a total scam. Do you know why they have to advertise that on their premium cards, there are no telemarketers? It's because they used to sell custoer's info to telemarketing firms. I know this because I had one about 7 or 8 years ago and it was the worst experience of my life. The BBB is filled with complaints about CapitalOne. Do a google for CapitalOne Scam and you'll see everything you need to know.
