HELP!I'm pouring my heart out here, need advice!*Updated 6/12/07*

[Lyn5]

Interestingly my 20 year old DD applied for a Disney Visa and was denied because she doesn't make enough money. She does have some money from a part-time job. She did get 2 from other companies though.

That's odd, my DD who is 3 and knows her letters, but cannot read, is preapproved for about two airline cards .

 

[dvcgirl]

That's exactly why the credit card companies where pushing so hard for the new bankruptcy laws! But I don't think they are any more to blame than a person who applies for credit knowing they can't make the payments. There are indeed 2 sides to that coin!

Interestingly my 20 year old DD applied for a Disney Visa and was denied because she doesn't make enough money. She does have some money from a part-time job. She did get 2 from other companies though.

I for one am thrilled that there are about to be tougher bankruptcy laws in place. There has been far too much abuse in this area for many, many years. We all seem to know at least one person (we know a couple) who have gotten into financial trouble, file chapter 7 and get to start over again. In most cases, these people don't lose their houses and they often get to keep their cars...and lots of their debt was just wiped clean. Which is why it was called a "fresh start" bankruptcy.

Now, many of those people would have to file for Chapter 13, and will be put on a repayment plan to pay some of their debts back. A court will determine what they can afford to pay.

I can see both sides of the story here. I don't think that CC companies should be sending cards to college kids, but at the same time...hey..they're adults and need to understand the consequences of personal finance and responsibility. Parents need to know what their kids are up to as well. And all adults need to determine the difference between needs and wants.

And when it comes to adults, I think it's unfair to slam the CC companies because they'll give anyone and everyone an additional line of credit. I don't even *know* what our credit lines are on our cards. I'm sure that they're pretty high, but I have no idea. Why? I don't need to know...because I have absolutely no intention of every carrying a balance let alone getting close to the limit. Unfortunately, many see this as validation of some kind...that they must be doing well if everyone keeps sending them these cards. We all need to know our own limits.

 

[nowellsl]

I for one am thrilled that there are about to be tougher bankruptcy laws in place. There has been far too much abuse in this area for many, many years. We all seem to know at least one person (we know a couple) who have gotten into financial trouble, file chapter 7 and get to start over again. In most cases, these people don't lose their houses and they often get to keep their cars...and lots of their debt was just wiped clean. Which is why it was called a "fresh start" bankruptcy.

Me too! They also have to have completed credit counseling before they can file -

 

[crisi]

I, too, see both sides to easy credit. Part of me thinks that credit card companies SHOULD take responsibility for risky credit choices, make them, go out of business. But the credit card business model pretty much lets them do what they want.

I'd have liked to see the bankruptcy laws passed in conjunction with laws regarding usury and maximum fees on credit cards. In other words - you can give credit to whomever you want, you can't change anymore than prime plus 8% (or something). If you cap the interest, that will reduce the incentive for credit card companies to make risky credit choices. Likewise, limit their ability to make it up on fees - the maximum late payment fee should be $10 or .5% of the outstanding balance whichever is greater (or something - I'm pulling numbers out of nowhere here). However, given our current love of the invisible hand and laissez-faire economics that would have been too much to hope for.

 

[dizcrazy]

"I for one am thrilled that there are about to be tougher bankruptcy laws in place. There has been far too much abuse in this area for many, many years. We all seem to know at least one person (we know a couple) who have gotten into financial trouble, file chapter 7 and get to start over again. In most cases, these people don't lose their houses and they often get to keep their cars...and lots of their debt was just wiped clean. Which is why it was called a "fresh start" bankruptcy. "

I could not agree more-I know three people who have declared bankruptcy, and each one is now in debt again! I thought that they would have learned their lesson the first time, or at least be unable to get any credit because of the bankruptcy black mark on their credit report. Alas, they didn't learm the lesson and got credit (one is paying 24% for a new car) What the heck

I do have compassion for people who have financial problems due to medical costs, or a natural disaster like katrina. but not for people who don't know the difference between wants and needs.

 

[MrsPete]

You can use DVC as a goal.

I have to agree; first for the reasons you listed, second because I don't think it's all that great a deal. You can rent points from DVC members for only slightly more than they're paying for their yearly maintenance fee, and you don't have to pay the initial buy-in price. Also, if you're not DVC members, you're free to take advantage of all the off-site promotions and specials that are often very inexpensive. While I love on-site, I also love off-site; it's a very different vacation.

But most importantly, I think the original poster needs to concentrate on NOT SPENDING right now, not setting expensive financial goals for down the road. Focusing on DVC allows her to continue the problem, just in a slightly different format.

 

[MrsPete]

You know, you are a very good customer as far as the CC companies are concerned. You spend quite a bit and you don't pay off your balance every month, and yet you make your payments on time (we can assume). They should be willing to bend quite a bit in order to keep you as a customer. Don't tell them you're having problems. Tell them you've received offers for cards with lower interest rates, and you're considering switching, but of course you'd rather avoid the hassle and stay with your current cards if they're willing to give you a better rate.

This is good advice IF you have the willpower to make the financial changes and follow through with what you know you must do. Credit counselors, etc. aren't really going to do anything for you that you can't do for yourself. They just map out the way to get out of debt -- you have to do it yourself.

On the other hand, some people NEED someone else to show them how to get out of debt and to hold their hand through each step. They need someone to "look over their shoulder" -- kind of like some people benefit from the weigh-ins at Weight Watchers each week. If that's you, then hie thee to a credit counselor.

 

[MrsPete]

Just as an aside, I'm always extra suspcious of anyone using "Christian" in their name or their advertising. Debt consolidation and counseling is the same if you are Christian or Buddhist. If I were going to run a scam, targeting Christians by "being a good Christian" would be my choice of scams. So many really good people, but very trusting people, that I know will trust someone without reservation because they go to the same church.

Perhaps that is a disservice to these people, or perhaps I am too jaded.

I would check out ANY company I planned to use; however, a Christian family might be more comfortable using someone whom they know shares their values. I know that Crown Ministries has been around a while and has a good reputation.

 

[MrsPete]

Christians are the new scam target according to the program.

Sure, some people will use any "in" to find a victim. But in most cases, no one can rip you off unless you allow them to do it. Don't go into anything blindly.

 

[dvcgirl]

"I for one am thrilled that there are about to be tougher bankruptcy laws in place. There has been far too much abuse in this area for many, many years. We all seem to know at least one person (we know a couple) who have gotten into financial trouble, file chapter 7 and get to start over again. In most cases, these people don't lose their houses and they often get to keep their cars...and lots of their debt was just wiped clean. Which is why it was called a "fresh start" bankruptcy. "

I could not agree more-I know three people who have declared bankruptcy, and each one is now in debt again! I thought that they would have learned their lesson the first time, or at least be unable to get any credit because of the bankruptcy black mark on their credit report. Alas, they didn't learm the lesson and got credit (one is paying 24% for a new car) What the heck

I do have compassion for people who have financial problems due to medical costs, or a natural disaster like katrina. but not for people who don't know the difference between wants and needs.

I have compassion for those people too. However, that disaster does highlight a need for a solid emergency savings plan. And on a different topic, welfare reform.

My DH and I come from a very similar backgrounds. Both sets of parents never went to college...but they worked really, really hard...and saved. We were both in the first generation of our families that graduated from college. After years of college, lots of hard work, some luck at being in the right industry at the right time, and being frugal...we've amassed quite a nice nest egg. We've also covered our negatives. We have good solid term life insurance. We have excellent disability insurance. And we have a year's salary as our emergency fund. That didn't happen overnight, but we now have that in place. It's been in place for awhile actually.

And so what I'm saying is that there were lots of lots of things and trips and cars and stuff that we could have bought along the way and let all of the above slide.....but we didn't. We travel and enjoy ourselves, but we don't stay in five star hotels, we look for deals of Orbitz or Hotels.com. When we do need items for the house or for ourselves, we always look for sales. But before even purchasing, we distinguish whether it's a need or a want. And sometimes, you've got to allow yourself some wants. But the "want" has to equal the income and the financial picture.

And even our OP had some medical bills in with her large amount of CC debt. But there was lots of other spending going on there as well. If the OP had an emergency fund in place, perhaps those medical bills would not have ended up on the CC. And not to pick on you OP, because you've been an excellent sport, but had the OP given up Disney trips or extras for her house, she could have had it in place. Needs vs. Wants.

 

[MrsPete]

I for one am thrilled that there are about to be tougher bankruptcy laws in place. There has been far too much abuse in this area for many, many years . . . Parents need to know what their kids are up to as well

I agree about the bankruptcy laws! They're costing us all money, and it's just another form of robbery.

As for college students and their parents, remember that the vast majority of college students are adults -- they're over 18. So they're legally adults. Of course, that doesn't mean that they're ready to handle adult decisions -- it just means that the law sees them as adults. That's why it's so important to teach your children about money management while they're younger.

 

[dvcgirl]

I have to agree; first for the reasons you listed, second because I don't think it's all that great a deal. You can rent points from DVC members for only slightly more than they're paying for their yearly maintenance fee, and you don't have to pay the initial buy-in price. Also, if you're not DVC members, you're free to take advantage of all the off-site promotions and specials that are often very inexpensive. While I love on-site, I also love off-site; it's a very different vacation.

But most importantly, I think the original poster needs to concentrate on NOT SPENDING right now, not setting expensive financial goals for down the road. Focusing on DVC allows her to continue the problem, just in a slightly different format.

Yes, what you're saying is true about the OP. She needs to find other less expensive things to make her happy. Like I said in another post, she can't afford to stay at the Roach Motel out on 192 right now.

On another note, I actually do think that the DVC is a good deal (especially if you pay cash). Well, it was back when we paid 62 a point. Now it's getting a little pricey to buy directly from Disney. We recently sold our membership because we live in Orlando now and do not need it, but we found it was a very good deal. We paid cash and rented out over half of our points each year. Our rental money paid for our dues and passes. So we'd use the other portion of our points, go during low points season and stay in a studio for a week. We sold it, made a few grand...actually have to pay capital gains...lol!

If you're making payments to Disney for DVC though...takes much, much longer to break even. And then it probably isn't the best deal...you'd be better off renting. I'll never understand why DVCers seem so adamant about keeping that rental figure at 10 bucks. DVCers seem to be against renters, and one way to discourage it would be to raise the price. I told a friend of a friend about the DVC point rental thing...she couldn't believe it. She saved $1,200 off of her hotel bill by going that route....

 

[3DisneyKids]

Many of us have now been giving the OP advice for pages and pages (and pages...)

On the one hand, I giveher credit for baring her sould here, but on the other hand...what has happened?

I'd like to know if she has taken any advice? Did you cancel cable? I read that your froze your CCs (good!) but you should CANCEL all but one. Just pay 'em off one at a time.

Are you using the snowball method?

Did you ax the high speed internet?

You've been talking a lot (which is great) but talking about it will not get you out of debt. You must ACT.

 

[CarolA]

And when it comes to adults, I think it's unfair to slam the CC companies because they'll give anyone and everyone an additional line of credit. I don't even *know* what our credit lines are on our cards. I'm sure that they're pretty high, but I have no idea. Why? I don't need to know...because I have absolutely no intention of every carrying a balance let alone getting close to the limit. Unfortunately, many see this as validation of some kind...that they must be doing well if everyone keeps sending them these cards. We all need to know our own limits.

My Disney Visa has $32,000 limit (No clue how you get such a wierd number LOL!)



However, if I ever put more then $10,000 on the car and do NOT pay it below $10,000 I will lose my job!!! So, I don't think I was the customer Chase was aiming for LOL!

It did come in handy when I took the Girl Scouts to Europe and day 1 the staff member lost the council credit card. WHen I got home I had $9,000 in charges on it. (The council mailed me a check as soon as we got home and I paid Chase!) You can spend a lot when you take 12 people to Europe!

 

[sk!mom]

I'm laughing because this is EXACTLY what happened when we bought our first house! We wrote out a list of everything we felt we needed and could afford in a house -- actually, we wrote out two lists: must-haves and wants. When we started looking at what "they" say we could afford, suddenly our eyes grew larger than our stomaches! "They" said we could afford a McMansion! So we started looking at some of them . . . and we liked them! The bank encouraged us to "buy as much as we could, as soon as we could".

This was our experience, also. We finally gave up on our realtor and found our house ourselves because the realtor insisted on showing us houses that we could "afford" but would have truly made us house poor. Luckily for us, we knew how much of a mortgage would be comfortable for us. We didn't want to have a house and nothing else.

Banks do this because most people are going to pay the mortgage first. And if you do not pay- the bank can always repo the house and sell it to someone else.

 

[tlbwriter]

My Disney Visa has $32,000 limit (No clue how you get such a wierd number LOL!)



However, if I ever put more then $10,000 on the car and do NOT pay it below $10,000 I will lose my job!!! So, I don't think I was the customer Chase was aiming for LOL!

Now, Carol, you can't say something like that without explaining!

I read once that people who have recently filed for bankruptcy are actually a target for some lenders, because they know they can't file again for several ears.

 

[CarolA]

Now, Carol, you can't say something like that without explaining!

I read once that people who have recently filed for bankruptcy are actually a target for some lenders, because they know they can't file again for several ears.

Sorry, I work for CPA firm. If we have a credit card from a place we have an audit relationship with then we cannot have a balance on all cards from the company over $10,000. There are LOTS of other restrictions. Trying to get a mortgage is a lot harder since you have to rule out about 40% of the lenders LOL!

 

[MAGICX2]

Many of us have now been giving the OP advice for pages and pages (and pages...)

On the one hand, I giveher credit for baring her sould here, but on the other hand...what has happened?

I'd like to know if she has taken any advice? Did you cancel cable? I read that your froze your CCs (good!) but you should CANCEL all but one. Just pay 'em off one at a time.

Are you using the snowball method?

Did you ax the high speed internet?

You've been talking a lot (which is great) but talking about it will not get you out of debt. You must ACT.

I have several things I am working on right now. You wouldn't believe all the ways we have found to cut corners. My daughter is having surgery tomorrow to replace the tubes in her ears due to chronic ear infections. After we get home from the surgery I have a plan of action in place to get some other things taken care of. I will give a full update either Su. or Mon. But, just know that I have not spent 1 penny since last Sat. I know it's only been five days, but not one cent, not one! That has taken alot for me to do and I am so proud, I am going to see how long I can go. Of course I have to get gas tomorrow! But, no extra spending and I am soooo proud. (Don't burst my bubble by saying big deal. It has been a big deal for me. I probably would have dropped $30 by now if this was 3 weeks ago.)

 

[disneysteve]

My daughter is having surgery tomorrow to replace the tubes in her ears due to chronic ear infections.

But, just know that I have not spent 1 penny since last Sat. I know it's only been five days, but not one cent, not one! That has taken alot for me to do and I am so proud, I am going to see how long I can go. Of course I have to get gas tomorrow! But, no extra spending and I am soooo proud. (Don't burst my bubble by saying big deal. It has been a big deal for me. I probably would have dropped $30 by now if this was 3 weeks ago.)

Good luck with your daughter. I know from experience that it is a very helpless feeling having your child in surgery wondering what's going on.

And congratulations on your spending freeze so far. I think 5 days is a big deal for you! It shows that you are focused and paying attention to your behavior and that's the only way you will ever succeed. Looking forward to hearing your updates.

 

[tlbwriter]

But, just know that I have not spent 1 penny since last Sat. I know it's only been five days, but not one cent, not one! That has taken alot for me to do and I am so proud, I am going to see how long I can go. Of course I have to get gas tomorrow! But, no extra spending and I am soooo proud. (Don't burst my bubble by saying big deal. It has been a big deal for me. I probably would have dropped $30 by now if this was 3 weeks ago.)

Considering that you used to shop to relax and entertain yourself, and you're obviously going through a period where you could use some relaxation and distraction (been there, done that), maintaining the spending freeze is definitely something to be proud of. It's a good first step.