Personal Finance

Too much creditcard balance,Need advice

  • Last Updated:
  • Jul 21st, 2017 8:14 pm
Sr. Member
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Mar 9, 2012
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For 200K debts (outside of a mortgage), personally that would be my first bankruptcy regardless of my assets. I would liquidate and hide them.
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May 29, 2006
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there is no way this thread is true. 200,000 in CC debt is like 12000 a month in min payments. OP makes like 4000$ a month after taxes.
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Dec 16, 2005
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skunkyjosh wrote:
Jul 15th, 2017 10:21 am
Bankruptcy is your only option, your income is terrible for all your debts.

Refinance @ 571K @ 2.64% on 360 months would have been your only option but you won't qualify with your debt ratio.
$2,108.17/monthly would be your payment on 30 years. Can you support it? No you can't and you know it. You have other payments (tax, school tax, car payment, etc)
Even if your bank would give you cash-back at renewal, it still won't be enough to make a difference.

I repeat, bankruptcy is your only option.
This is terribly irresponsible. Bankruptcy is far from OPs only option. In bankruptcy OP likely wont be able to keep his house anyway so why go that route?

Better to sell on his own, settle the debt, walk away with significant cash and preserve his credit bureau.
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mech9t5 wrote:
Jul 15th, 2017 10:37 am
This is terribly irresponsible. Bankruptcy is far from OPs only option. In bankruptcy OP likely wont be able to keep his house anyway so why go that route?

Better to sell on his own, settle the debt, walk away with significant cash and preserve his credit bureau.
Sure. Pay everything off with the profit or bankruptcy. Personally, I could live 7 years with 200K net hidden.
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bewiseman wrote:
Jul 15th, 2017 10:52 am
You're actually advocating bankruptcy fraud as opposed to the OP taking responsibility for his own stupid spending, when he clearly has the means to pay with assets he has at his disposal?? Wow! Well, aren't you an ethical fellow!!

The OP doesn't sound smart enough to play that game well enough and actually get away with it. Its more likely he'll get caught and find himself in a vastly worse position.
You're no fun! I wasn't that serious but if he's down for it, there's 8 countries where you can live off $200K (USD) for 30 years as per this article.

http://www.investopedia.com/articles/re ... -years.asp

Reality check would be to sell his property, pay off all debts and rebuild his credit history because he's hurt due to high utilization % so he can buy something again in 2 years--- or just rent for now.
I just don't think it's a serious thread or a serious story.
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Dec 16, 2005
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skunkyjosh wrote:
Jul 15th, 2017 11:00 am
You're no fun! I wasn't that serious but if he's down for it, there's 8 countries where you can live off $200K (USD) for 30 years as per this article.

http://www.investopedia.com/articles/re ... -years.asp

Reality check would be to sell his property, pay off all debts and rebuild his credit history because he's hurt due to high utilization % so he can buy something again in 2 years--- or just rent for now.
I just don't think it's a serious thread or a serious story.
Well if you are gonna commit fraud and run why bother declaring bankruptcy and paying anything back?

Sell all assets and leave the debt. Bank will get their mortgage back but everything else will be free for the taking. $800k less $370k and fees would be around $400k

You could take $400k and not commit fraud, or claim bankruptcy and commit fraud for only $200k... Obviously one choice is better than the other.
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Dec 12, 2009
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bewiseman wrote:
Jul 15th, 2017 11:10 am
Even if you manage to sell your house for a profit, pay off all of your debt, with your bad habits, you MUST protect yourself from YOURSELF! Shoving a ton of cash into your RRSP is a good way to do this.
Interesting concept. I don't know what the rules are for buying your second home ... Couldn't he then borrow from the RRSP to use for a down payment in a few years?
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MoneyHypeMike wrote:
Jul 15th, 2017 10:25 am
Did we get a post detailing all the debts and income?
I do not understand how banks/creditors would give away that much money on such low income.
My total unsecured revolving credit limit is approx. 2X my income. My spouse adds on some more.

Downgrade my job, max out my credit, boom ... We could get to 3X consumer credit in short order. And I'm not even a credit seeker ... just a credit signup bonus promo seeker :)
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MoneyHypeMike wrote:
Jul 15th, 2017 10:25 am
Did we get a post detailing all the debts and income?
I do not understand how banks/creditors would give away that much money on such low income.
Below paragraph comes from Op's original post #1

(Note: We bought this house year 2001 , For $247,000 . We got mortgage from td bank and my down payment $80,000.
Then, after few years we had credit card balance problem , then we switched (refinance) mortgage with rbc $280,000
Then after few years , credit card balance problem again, refinance mortgage with rbc $400,00 (now balance 371,00)
Now, we have credit card balance problem again, Now house value about 800.00)

----

Op's refinance the mortgage twice due to credit card balance problem. He also mention the bank asked him to cancel all his credit card. HIs mortgage is up for renewal in November 2017. His assuming of his house value of $800K remains to be seems. So, looking at his situation what can you say? will the bank/creditor roll his credit card balance into his mortgage again?
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bewiseman wrote:
Jul 15th, 2017 3:09 pm
You have a point, but this is already excessive. Consider that credit card interest is often 20%. Therefore, at 200% of income, 40% of your gross income income is going to interest payments, assuming you're maxed out on your credit cards, as the OP likely is. I realize that we can often lower our interest rates to less than 20%, but this is still an excessive debt payment. I also realize that these limits are supposed to be given to people who DON'T max out their cards, but maxing out cards is more common than you may realize. This is especially true when income drops suddenly which is a part of the argument you presented in your post.
My point isn't that is or isn't excessive, just that it seems easy to get into this situation. I was at over 1.5X getting new cards just for free points and new banks continue to happily extended me very generous limits.

Some of the later cards I got from CIBC and TD were higher limits than some cards I've had for years prior.

They seem to hand out credit like candy, and if your job situation changes I could see how anyone could easily end up with total limit 3-4X salary.

And with some cards on 0% BT or other low offers and lower min. payments you could easily shuffle the same money around to make all the min. payments without actually needing it to all come out of your income.

$200k with 3% min payments would be $6k/mo.

But if some of those are BT offers the min. payments are 1/3 of that. Also some cards may have normal 1% min. payment, not 3%.

It's obvious not indefinitely sustainable ... but you can easily get yourself there and tread water for a bit.

Posters saying "that's impossible" are wrong.

Yes it's impossible to tread water in the middle of a lake forever. OP started in shallow water and drifted into deeper water ... and now he's looking for a lifeline. He didn't jump into the middle of the lake instantly and stay there for 2 years.
POLL: How frequent is your RRSP-matching?
Plastiq: Pay any bill with credit card for 0-2.5% fee (help meet min spending and keep old cards active!)
Rewards program transfer times (e.g. SPG->Aeroplan, Marriott->SPG, Amex MR->SPG...)
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ace604 wrote:
Jul 15th, 2017 4:09 pm
My point isn't that is or isn't excessive, just that it seems easy to get into this situation. I was at over 1.5X getting new cards just for free points and new banks continue to happily extended me very generous limits.

Some of the later cards I got from CIBC and TD were higher limits than some cards I've had for years prior.

They seem to hand out credit like candy, and if your job situation changes I could see how anyone could easily end up with total limit 3-4X salary.

And with some cards on 0% BT or other low offers and lower min. payments you could easily shuffle the same money around to make all the min. payments without actually needing it to all come out of your income.

$200k with 3% min payments would be $6k/mo.

But if some of those are BT offers the min. payments are 1/3 of that. Also some cards may have normal 1% min. payment, not 3%.

It's obvious not indefinitely sustainable ... but you can easily get yourself there and tread water for a bit.

Posters saying "that's impossible" are wrong.

Yes it's impossible to tread water in the middle of a lake forever. OP started in shallow water and drifted into deeper water ... and now he's looking for a lifeline. He didn't jump into the middle of the lake instantly and stay there for 2 years.
But can Op's find a lifeline within the next 4 months? consider his mortgage renewal is in November?
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Jan 27, 2004
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Holy crap. Youre like the real life version "till devt do us part".

Frankly... just spend less. Lets see your budget. We can help balance and critique it.

Cabbage and apples are cheap and nutritious...
Pork neck bone makes fabulous soup and has lots of lean meat in it and $0.99/lb...

Steak is 5.99/lb @ metro on sale if you need a treat...
And laker ice is the cheapest beer if youre having a really rough day.

Meetup.com has great kid play date groups. No need to pay for hockey and soccer...
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cgtlky wrote:
Jul 15th, 2017 4:33 pm
But can Op's find a lifeline within the next 4 months? consider his mortgage renewal is in November?
Don't know.

Basement is supposed to be filled with recent multiple higher priced RFD Hot Deals.
If they hoard like they spend, there might be a glimmer of light at the end of the tunnel.
On Edit: I took the lead from an earlier post and looked up the OP's posting history. There are multiple computers, laptops, monitors, large screen TV's etc. It is hard to imagine a single person buying that much stuff. They would need to take inventory to deterimine a value for a clearance sale

They might get $20K for the car, but there are still 3+ years left to pay.
$188 x 6 x 26 biweekly payments = $29,328 - (2.5x26x$188) or $12,220 = $17,108 still owing
Net on vehicle if sold might be $5K
On Edit That $5K or so could be used to buy an older vehicle freeing up $376 a month in payments.

Things are doable, but it then becomes will it be enough, soon enough to meet that November deadline?
Last edited by ROYinTO on Jul 15th, 2017 5:40 pm, edited 2 times in total.

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