Are you down because of your debt?

Join the club. Being in debt blows. The past 12 months I’ve been learning to cope and deal with the on-going pressure that debt brings into your day to day life. So far I’ve found a few things that seem to lighten the burden. These are actually techniques I’ve been using that are cheap and effective in handling the stress and emotion of being in debt.

12 Ways I Deal With Debt (all 300K+ of it)

1. Burn Stuff - I’m not talking about burning down your bank. That would get you jail, not relief (well, it might give you some satisfaction). Try a 3-hour firelog, or real firewood. Add in a movie and you’ve got a nice relaxing few hours. There is just something soothing about flames. Also, for bonus points, burn all those credit card offers you still get (just don’t burn the plastic. it’s not safe).
2. Give away your sweat - Do you have a charity or cause that you wish you could give money too, but you just can’t spare a penny? Why not volunteer there? Give them a call and see if you can work a few hours each week. You may not be able to contribute with your pocketbook right now, but that doesn’t mean you can’t help out. Volunteering can also put your life and blessings into perspective. (more…)

   I'm 300K in debt. Gulp. I'm 24 and day traded away a fortune. Now I'm trying to crawl back to zero. Why not subscribe to my RSS feed and join me on this journey. You can also subscribe via e-mail. I appreciate tips and feedback! ~ DebtKid

I just got back from a short meeting with my debt counselor at consumer counseling northwest.

I had sent in my first payment about 2 weeks ago, and she wanted to chat about what got accepted and what needed to change.

The Good News

The good news is that it looks like all my interest rates will go dramatically down right away, except for my wells personal line (25K), the biggest debt.

The Bad News

WellsFargo is being lame, and won’t accept me into the plan until a $1000 late balance is taken care of. So, for the next three months, my DMP (debt managment plan) payment will be $1480, and not the $960, as I was hoping.

The Funny News

My conselor, Irena, is just a hoot. She moved to the US (from eastern russia from the sound of her accent) a few years ago, and is really passionate about helping me out. She said some really great lines to me in our past meetings, so I wrote a few down today that made me smile:

“let’s make experiment” (she says this when she pulls up the calculator in windows to run numbers)

“God want you to be safety” (she murmured this one today, I think it sliped because the place is a secular non-profit, not affiliated with any church, but I’m glad she thinks God wants me to be OK)

I just had to write those down because they made me smile.

I had some time this afternoon to work on my payment reduction strategy.

Right now, I’m hating WellsFargo (my own bank of 8+ years), and loving Citibank. Let’s recap

The Ugly (WellsFargo and Chase)

I have 3 lines with Wells. A $500 limit student credit card, which I plan on keeping current, as the payments are low. A 25K personal line, and a 20K business line. I called today to find out if they offer any payment programs on my two lines of credit. Bottom line: nope.

Apprently my personal line needs at least 9 payments before they can consider “re-age”, which, I don’t even know what that means. I did learn no charge off til 120 days, I’m at about 45 at the moment. So I have some room there. My goal is just to stay away from collections at this point. So, I’m going to be doing about a 1/2 payment on the personal line, if I can do it.

The business lady was not helpful at all. She basically said, “in one week, this will go to the legal deparment”. Charge off is at 120 days. I paid a small payment of $285 (seems big now) today. Need to watch this one.

Chase

The Chase lady was no help at all. All her options were, “I would recommend making the min. payment”. Like a broken record that is all she could say. She did tell me that the next “cycle” (billing cycle) would be Feb 16th, and that options might be available then. Humph.

The Bad (WAMU and Citifinancial)

I have a 15K personal line at citifinacial and a 30K SBA line at WAMU. Both are less than 45 days late. Neither have any sort of payment plans available at the moment.

I told citifinancial I would bring $200 to their branch tomorrow and a post-dated check for $300 on Feb 15th. (I’m just trying to buy some breathing room here) So that takes care of them until March 1. It was more than I was hoping ($500), but the best I could get.

My WAMU payment was/is late as of today, so I now behind on it. I have 90 days on this before write off, so this account is getting put very low on the priority list. WAMU didn’t seem too concerned, could be because it is SBA backed and it they have to write it off, they don’t lose much (I think that is how it would work).

The Good (CitiBusiness)

I talked with a wonderfuly nice fellow from Texas in the collections department at citibusiness. We basically did the “how much can you pay on this” dance for a bit…I made a few jokes, we bonded, and he started just telling me what payments would get me down to the 0% level on their repayment program. So I got three of my citibusiness cards down to 0% for 12 months!!! Awesome! This was definetly the highlight of the day. I dropped my monthy minimums by over a thousand dollars by going into their repayment programs. Yes, my credit score is going to suck, but 0% for 12 months is an offer I cannot refuse at the moment! I’ll take it.

Other Creditors

Staples - learned that the rate (APR) is not negotiable until 60 days. I am current on this. No joy here.

Litton Loan (1st Mtg) - I found a good “hardship” phone #, but the dept. was closed by the time I called. That is my big goal for tomorrow, talking to Litton. My payment with them on my 1st Mortgage is around $2500 a month. I need to get that down to $1500 a month for a least a few months. I’m just trying to buy time at the moment without adding more debt to the pile.

So, my monthly payments are now down to $7,469. Still not to my goal of 5-6K. If I can shave off another $1500, that would be a big, big help. I was at around $9,100 to start the week off. So, $1600 in 3 days, not bad. Just gotta get that mortgage down for a few months…

My Business (income side)

Business future is looking good at the moment. We started a new advertising division back in Sept. I testing our concept for a few months, and it worked, so we are selling our services full time now. If I can devote myself to selling for 8 hours a day, I can sell about $300-$400 a day in MONTHLY subscriptions to our services. That is assuming I can keep up our leads coming in as well. As soon as I get all my debt arrangements worked out, I should be posting more and more about my business side of things to get my income up and over 10K a month.

I’m off to a pickup basketball game with my younger brother (he still doesn’t know about any of this…I’m planning on telling him next week). I’m exausted, but a good b-ball game will make everything better!

All my sins…

It’s felt like a trifecta of pain today. After a full work day, I began getting on the phones again to deal with the creditors.

American Express (total balances: $2,783)

I have two AMEX cards. Lines of $500 and $2000. The balances are: $772 and $2011 respectively.

When I reached the CSR (customer service rep), I asked first about loweing the APR. “not possible”. Any hardship or forbearance programs available? “No”. “What can you pay?” “$25/month, I say”. She says that is fine. I was taken aback by this. I asked about the consequences of this, and her only answer was “higher finance charges”. She really didn’t seem to understand what I was trying to do, and while nice, not very helpful. So I paid $25 on each card and will have to come back to those in a week or two (both of the “current amount due” amounts were over $50).

Chase (total balance: $10,579)

What a mess. I calll around 6:20pm PST. I know that they close at 7pmPST, so I figure I have lots of time. I wait on hold, and wait, and wait, and wait.

30 minutes go by. I hang up.

I call back….”our offices are now closed (6:57pm), please call back…”

Grrrr. This is an important card for me to take care of. The balance is: $10,579, but I am quite behind and the amount due is nearly 2K. I have to get this payment down to at least $150/month

Citi (total balances: $26,407)

Another dissapointment. I was hoping to get my 4 citibusiness cards resolved today, but apprently my “new options” won’t be available til tomorrow. Bummer.

I spoke with my father for a good amount of time tonite. He is seeming a little more optomistic about my progress, and hasn’t called the lawyer yet…

Yet.