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Scott,
Help please! I heard you on the radio and what you had to say made
sense to me. I am so far in debt and can't seem to breathe. I have 6
credit cards and I am $25,000 in debt.
I know you hear this all the time,
I have been paying for over 2 years not charging anything and still
cant get anywhere. I cut them 2 years ago, and called the companies
to ask for a lower rate. They gave me like a year with low interest,
and lower payments so my credit reports would not be hurt.
Bottom line, my credit report
looks so bad, we can't even refinance our home. I am in so deep that
if I had a pill I'd take it! When I called a company to help me all
they wanted to do was charge me more money that I don't have. I am
not sleeping, and just don't want to leave my home. I own my own
business, and I am just asking for your personal help. Please,
please help me.
Thank you,
Stephanie
Stephanie,
Thanks for writing (and listening)!
Sorry to hear how much your debt
burden is affecting your health. I can certainly understand how you
feel. Knowing that you owe money, expensive money (at high rates),
can certainly stress-out anyone who wants to make good on their
financial commitments.
As you're probably aware, getting out
from under this debt will not be an easy one-step solution. It's going
to be an ongoing process that will take years of focus, attention,
planning, and work.
The broad picture to getting out of
debt is three-fold:
1) Get organized financially.
2) Manage your current debts efficiently.
3) Get more money!
Since you own a small business, I have
a feeling you're fairly organized. Briefly stated; files,
worksheets, list of all the debts and bills.
It's number #2 that's the killer (no
pun intended).
You already mentioned that you've
tried to call the banks and get them to reduce your rate. You may
want to call back and give them one last chance. If the first rep
cannot help you, then ask to speak to a supervisor. There's much more about
this topic in my next book, Talk
Your Way Out of Credit Card Debt which is available for
pre-order at Amazon.com (shameless plug).
 If they don't lower the rate then you
need to punish them! You need to spank their bottoms, well, bottom
lines.
Apply for new credit. Do it now.
Someone will give you a chance. Even if the rate isn't
that great, meaning that it's not better than your current cards,
get the card anyway and transfer your balance to teach your current
banks a lesson. After that it won't be long before the banks start
competing for your business.
You can read my article, Getting
better, cheaper credit--right now! and apply for new
credit.
Next, correct any errors that exist
on your credit report. You can get a copy of your credit report from
Equifax
or TransUnion.
Dispute anything that you think is not accurate.
The key to all of this is taking
action. Start right now! Start calling right now, start
applying for new credit right now. It's been my experience that it
helps to have the same amount of credit as debt in order to get the
banks to offer you good deals.
The best deals, and I mean lowest rate
offers, will originate from your existing credit accounts, so get
more of them. Don't cut up your cards, because when you do that you're cutting out
your options.
You'll need $25,000 of available
credit so you can transfer all your existing debt to new cards.
Believe me, when those banks that just got paid off realize that
they're not making any money from you they'll send a low rate
offer pronto!
Just be sure to pay on time! There is
no greater sin in the world of credit than being late. As long as
you don't pay late and are active in seeking new credit deals, you'll be
able to reduce your rates in time.
The last step is getting more money. You
have a small business. What do you need to do to make it run better?
What do you need to do to sell more?
I love reading books about marketing
and motivation. The correct marketing can make all the difference in
the world.
Here are a few of my favorites. You can
get them by clicking on their titles:
Lastly, in the scheme of what's
important, your debt shouldn't make you feel unhealthy. Try to get back to sleeping.
Relax. It will all work out. "Everything for the best," as
Jhoon Rhee would say.
One last book recommendation to help
you feel a little better while you're working on your plan is Don't
Sweat the Small Stuff... and It's All Small Stuff: Simple Ways to
Keep the Little Things from Taking over Your Life, by
Richard Carlson.
Good luck! I really hope that helps!
Please keep in touch!
Regards,
Scott
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