I need credit card help-will I save interest if I split up my monthy payment?

[Daydreamer64]

What is the best way to pay cc payments to try to lower the interest owed?

We get paid two times a month, every two weeks.

Should we pay half of the payment with each paycheck plus a little extra or all of it when due plus a little extra-once a month??

Long story short-sure, anyway, we have always had excellent credit.

We had to move from Ga last fall as Dh was hired for a job in NY, better pay, but we are still trying to sell the house in Atlanta and are having little to no interest.

So we are paying for two houses with all the money that goes with them. We have DMIL living in the Atlanta one to keep it homey and to keep the house from being attacked by no gooders. There have been several problems with the neighborhood with robberies and vandalism sp/.

Anyway, several trips later, looking at houses, and flying in and out of the state as well as some road trips, we moved into the new house.

We'd run my cc up to $17,000.00.

There were loads of problems like of course both vehicles needing major repairs at almost the same time, having the fridge quite working on us the 2nd week we were in the new house when we needed it to keep DS's insulin cold, one child fell and needed stitches, and another fell playing basketball at school and broke one arm and spranged the other, we had a pipe leaking that was missed in the inspection, the furnice needed serviced- you know how things add up with home ownership and kids.

I've paid over the minimum amount due on the cc every month and am/was slowley chipping away at the total owed.

You guessed it, we got a notice in the mail apparently in October, according to the cc people, stating that we needed to refuse the new interest rate of 16.9% raise that started on Jan 1, 2010, through no fault of our own.

Our choice is to close the card and pay off the balance or do nothing and have the rate that went up stay. We have been very blessed and have never missed nor been anywhere close to a late payment in all of the years that we have used this card. So, basically we are being punished for being good customers and making sure that we are with their program. Of course we missed the notice but wouldn't have closed the card anyway because it's our emergency card.

My interest due on the balance was $108 in Dec. The new bill came and the interest owed on the new balance was $239. So my minimum payment was almost $500- that was over a 100% increase in interest charges all while lowering our principle.

We had too much open credit and started to get notices that our "open credit paid off" cards were being lowered to an available credit of around $700 each- like 3 or 4 of them. Ok, we weren't using the cards anyway, just liked having them for whatever but usually putting anything on the cc that just raised our rates.

I can only guess it is due to us having the 2 houses and oweing on both, along with the new charges on my card.

So, we tried to switch to another lower interest card but were told that our ratio of income to out flow was not good enough now and were denied.

So, back to the first question- what's the most effective way to try to slow the interest rate adding up while paying the card down- split payments or a lump sum each month?

 

[Rgltr334]

Have you listened to Dave Ramsey? He has a website and radio program. His philosophy is to pay off all debt and he gives a plan to achieve that goal. His techniques can at least give you some options to pay off your CC debt.

Good luck,

Richie

 

[janette]

Almost all credit cards charge interest based on the average daily balance; it is to your advantage to pay as much as you can as often as you can.

 

[Daydreamer64]

Thanks for the information on the daily interest- I can pay on line so I will put a little on the bill every time that I can.

It's the unsold house that's causing the problem for us- I will check out Ramsey though, you never know what you may learn unless you turn over every rock!.

 

[wvjules]

So you didn't Opt-out of the rate increase?

I would opt-out and pay at the current rate. The card can't have any more charges on it and will be closed when it is paid off. It might be too late to opt-out now though.

 

[TxRabbit]

Citibank used to limit the number of payments per statement cycle that you could make online. I don't know if they still do, I haven't used that card in years. But check it out. It was four. Basically one payment a week.

 

[jenseib]

I too try to pay as often as I can to try and lower it just as much as I can. LOL! It's hard though. And very frustrating at times.

 

[nunzia]

Citibank used to limit the number of payments per statement cycle that you could make online. I don't know if they still do, I haven't used that card in years. But check it out. It was four. Basically one payment a week.

Wow...I wonder if they still do..when I'm working at paying off stuff I will sometimes make more than 4 payments in a month..twice for regular payperiods, then twice for second job paychecks and then ebay, etc...To the OP..I'm sorry..this sure does show us how much of a pain and how little control we have, with CC. It would be so nice to not have them at all, wouldn't it? If you are a ramseyphile you won't, and I do Ramsey for alot, but am just not comfortable using my debit online and for big payments..anyway..yes, since interest is computed daily, every bit as soon as possible applied is helpful.
Good luck and hang in there

 

[Daydreamer64]

So you didn't Opt-out of the rate increase?

I would opt-out and pay at the current rate. The card can't have any more charges on it and will be closed when it is paid off. It might be too late to opt-out now though.

No, we didn't close this card because at the time, the other cards with open credit were dropped to a lower available balance and I was afraid that we are in for a long road trying to get rid of the other house. I guess I thought of the cc as a saftey net if we got into trouble. That it might tide us over if there was a money emergency.

This card was at a zero balance at the start of last year.

We thought we should put all charges house related on it never dreaming that the move and all of the "stuff" that went on with it would ever add up to this much money.

Then all of the emergencies happened and here we are-

I will be sure to make weekly payments as possible and stop doing a lump sum payment each month.

My guess is that this card will also be dropped as I pay it off.

Oh yes, I forgot, moving from a hot area to a snow area required us to buy a snow blower as we are on the lake and couldn't physically keep up with the drive way and the 23 inches we got the first good snow storm for the year- those things are expensive, add that to two vehicles needing to have 4 snow tires for each too!