Should I use a debt management company to pay off $30k in credit card debt?

D

DunmerWyre

New Member
I have around $30,000 in credit card debt spread across 7 cards. The interest rates are extremely high. My total minimum monthly payments are $1,500, but this is not reducing the principal. Two credit card companies suggested I contact debt management companies.

I spoke with two of these companies. Their process involves negotiating with my creditors to lower interest rates and monthly payments. They promise to pay off all debt within 50 months. However, this requires closing all the cards.

Is anyone familiar with this approach? Is it worth it? My calculations show this route would save me over $40,000.
 
I found Greenpath Financial Wellness to be good, very upfront and honest. However, I was able to secure a lower interest rate through Discover on my own specifically, 0.99%. Therefore, I recommend you call Discover directly if you have an account with them.
 
When you negotiate a lower interest rate directly with your credit card company, they typically suspend your card privileges during the repayment period. After the balance is paid in full, your card access is usually restored.
 
Don't do it. That's a disaster waiting to happen.

Just file. Declare bankruptcy.
My brother in law went through it. And in about a year and a half? He got a new credit card. A new car. He was able to start fresh, completely.
It only stays on your report for seven years.
 
It's really positive that you contacted them and managed to reduce the payments, and if the accounts are closed, that's alright over time, as you pay them down, it should benefit you since they're reporting favorably to your bureau. I'm genuinely relieved you avoided bankruptcy. Perhaps the crucial step now is to reflect on how you reacched this point. Consider crafting a strategy to pay it off and, more importantly, to understand what led you here initially, so you can consciously adjust and avoid retracing that path. We all have unhelpful habits we can shift... I hadn't realized I had six subscriptions overlapping from my account, not to mention those Costco trips... It might be about spotting where there's room for change... This approach could set you on a more stable course and help maintain your focus on paying down this debt.
 
I turned to Consolidated Credit when I needed help. Signing up was straightforward they walked me through my debt to income ratio, then worked directly with my creditors to lower my payments. Once everything was settled, I simply made a single monthly payment to Consolidated Credit until I was debt free.
 
Back
Top