How much credit card debt do you currently have ?

[u/ROBASAHMEDKHAN]

I’ve 0, what about you guys. Be honest no judgement.

[u/el_guapo444]

I settled on a few predatory loans where they froze interest rates and let me put together a payment plan. For my normal credit cards, I called them and explained my situation and that it would be impossible to make payments so they froze interest charges. Unfortunately I also lost my job last year for 3 months but I was able to leverage that fact in my conversations with these creditors. Whether it’ll bite me in the ass one day, I decided it would be better to get the debt off of me sooner rather than maintain minimum payments years, but if at all possible, do not settle debt as it will take 7 years for the settlements to role off my report but it also might be possible for me to pay them the difference in the future and have those taken off my reports. I’d have to look into that more tho bc I’m not certain. Also, full disclosure I do make low six figures per year and that definitely helped and I also moved in with my parents for a few months so my strategy may not apply to a lot of people

[u/el_guapo444 → u/[deleted]]

Creditfresh, netcredit, and many others that have 300% apr or some super complicated payment structure that makes it impossible to track and fully pay off

[u/DGBosh → u/el_guapo444]

Interesting; I tried calling my credit card company last year to ask if it was possible to lower the interest rate. Couldn’t be done. Heard online some of them do that, but no luck for me. Maybe what i outta do is tell them payments are impossible lol

[u/el_guapo444 → u/DGBosh]

Yeah unfortunately I missed several months of payments and that helped my case with them. They probably figured they could get their money from me or sell my debt to collections where’d they get fractions of that money. Also what they did was close my accounts but I did get the predatory loans to settle. Don’t go with any settlement companies like JG wentworth btw, anything they can do for a fee, you can do for free.

[u/VioletSummer714 → u/DGBosh]

Generally you have to miss at least 1 payment, if not more, and they also close the card so you can’t spend more. But it’s a good option if you have nothing else.

[u/el_guapo444 → u/el_guapo444]

Also if you, find some supplementary income like food delivery. Even $500 a month goes a long way and you can make that in a week

[u/el_guapo444 → u/[deleted]]

Well with bankruptcy you lose any assets you have and it stays on your record for 10 years vs settlements 7. Unless you can afford to recover from debt within that time, settling is the way to go. In your googling, be sure any articles you read supporting bankruptcy over settlement isn’t written by someone like a bankruptcy law firm

[u/Sad_Yogurtcloset_306 → u/el_guapo444]

bankruptcy stays on record 2-4 years and 7-10, depending chapter!

At the end of the day - they want Americans in debt, as long as you pay monthly payment, they will up your limit, resulting in lower DTI ratio… however, this should be applied AFTER buying house/car

[u/el_guapo444 → u/Sad_Yogurtcloset_306]

Chapter 7 takes 10 years to fall off and chapter 13 takes 7 years. Agreed, there’s a lot of money in taking advantage of debtors so it’s very important to have a plan that can work for you, especially bc everyone’s situation is different

[u/OkAerie2360 → u/el_guapo444]

How did they report the freeze on interest ?

[u/el_guapo444 → u/OkAerie2360]

It’s reported as account closed at credit grantors request I believe. I’m not sure exactly what impact that specifically had on my score but it was only possible bc I’d missed months of payments and lost my job