Posted on May 21, 2009 at 9:40 am I have roughly $32,00 of credit card debt, am behind on a couple of the cards, and at this point am not really sure what to do? Can anyone give me some advice?

Posted on May 21, 2009 at 9:52 am Hello Ice Man- Have you considered talking to a reputable debt settlement company? Considering your circumstances I think a good company could help you out a lot. Here's why- you owe a lot, and you are already behind on a couple of your cards. Taking out a consolidation loan is never a great idea I believe because often these loans are given at such high interest rates. Since you owe over $30 K and are behind, it would take you a very long time to pay a conslidation loan off at a high interest rate, and in the end you would pay back thousands and thousands of dollars more than what you owe right now. Credit counseling would not be your best bet in my opinion because you are behind on payments already and the interest rates are not the biggest problem, the principle amount of debt and the fact that youre behind are. Filing bankruptcy is something that should be avoided at all costs because of the negative impact it has on your credit and future ability to take out new credit. Remember, Chapter 7 and Chapter 13 BK stay on your credit report for 10 and 7 years respectively, and both stay on your legal records for 20 years. A debt settlement company can help you budget a reasonable monthly payment and also negotiate with your creditors to try and settle the accounts for a reduction of what is owed. Credit card accounts must be past due in order for the lender to negotiate, and since you are already behind this option seems to make the most sense. I also recommend filling out a form on this website so you can get a free consultation and maybe some advice as to what you can do to find the right company. If that doesn't sound like something you would want to do, you may want to consult a family member or friend to see if they would be willing to help you out with your finaancial situation. I hope this helps and good luck!

Posted on May 21, 2009 at 9:56 am How far past due are you?  If you're only behind a couple months, then you can still get help from a credit counselor.  They can even have the late fees waived. 

Posted on May 21, 2009 at 10:03 am Right now I am behind 3 months on one card and 4 months on two other cards. What do you suggest? Does credit counseling help people in my situation? Thank you for your input.

Posted on May 21, 2009 at 10:19 am I don't know Debt Guru. Think about it- even if a credit counseling agency can get his interest rates lowered, he still would have to make siginificant monthly payments to chop down $32 K of debt within a 5 year time period (usually how long debt management plans are no?). Since Ice Man is already behind on payments, it doesn't sound like he has the financial ability to do that. Also, that is assuming his creditors work with debt management companies. There is no guarantee and I have heard that many do not. I would have to agree with Zales Shopper on this one- debt settlement seems like a better option.

Posted on May 21, 2009 at 10:32 am You're name is CreditKiller - I can't think of a better name for you.  For one, you assume that this person can't afford to pay just because he's past due.  That's pretty bold.  Plenty of people fall behind simply because they're disorganized and have too many bills.  Second, you bring up the point that creditors don't work with debt management companies.  Have you been under a rock for the past year?  The credit card companies are pretty much begging people to enroll in debt management plans instead of missing payments ever since the economy went south.  You can't read the newspaper without seeing at least one article about this.   

Posted on May 21, 2009 at 10:40 am Ice Man- Can you let us know why you are behind on payments? That would really help identify which option is best for you. Also, what are your interest rates on your credit cards? An average would be fine if you don't know each one... Guru- you make some good points but I am still not convinced. Even if all of his credit cards had 0% interest, he would still need to pay over $530 dollars per month to get through a debt management plan successfully and come out debt free on the other end.

Posted on May 21, 2009 at 10:54 am I am behind on my payments lately because my hours were cut at work (surprise surprise) and I no longer make what I used to. Basically right now I pay about $350-$400 per month to some of the credit card companies, but that is really all I can afford right now and I don't really have any savings.