Debt Consolidation Loan? Student w/ 10k CC debt, but about to make $
 

I am currently between my first and second year at law school. Currently, I have $11k on 6 CCs ranging from 6.99% to 13.99% interest (sick, I know). I've just been making the minimum payment and they are all just sitting there maxed out.

Now, next summer, I will be making 25k-35k (pretax) working at a law firm. My summer living expenses are somewhere around 5k, so I should have plenty to pay this off then. What I'd like to do, however, is pay them off now. If I do that, then I'll have 1-2k each semester extra, which I can use to begin paying this off or investing elsewhere.

What are my options here?

My credit is good, but I have no collateral, although I could probably get a relative to cosign once I got a firm offer. Thinking some sort of debt consolidation loan, or are those all quasi-scams?

What are my other options here?

My credit is really good considering, since I never miss a payment, is there any way given how crowded these cards are that a company would let me transfer all 11k over to one card with a lower rate?

Do I need to just keep paying the min until next summer when I can pay them off completely?


Any advice would be appreciated.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make $
 

I don't know if you could transfer a balance that big to one card, but best bet would be to try to get it all transferred to one of those cards that is interest free for 12 mos or whatever.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

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I don't know if you could transfer a balance that big to one card, but best bet would be to try to get it all transferred to one of those cards that is interest free for 12 mos or whatever.

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I remember previously I attempted to transfer to one card that was 0% for 12 months and I put down all the info for the other cards, and they set my credit limit at $500 and then transferred only $500 over. Is there any way to apply for one of these cards and basically tell them i want all or nothing?

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

I assume you have access to student loans? Is it possible to take out an additional student loan and pay it off using money derived from that?

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make $
 

The student loan idea is a good one - see if you can get some extra. i assume you have maxed the Stafford loans, but usually you can get the secondary (private/unsubsidized) lender to up youur loan amount.

On the balance transfer, apply over the phone, rather than online, and usually you can get an instant answer. If the amount is not enough to kill a couple of the other cards, you can tell them no thanks at that time.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

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My credit is really good considering

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Are you sure? Have you checked your score? If not, go to www.freecreditreport.com and get your score. I'd be surprised if your score was that good given that you have 6 maxed out credit cards. One of the components of a credit score is your available credit to debt ratio, which in your case would be pretty bad. I not sure what to suggest other than maybe trying to put in an app for a 0% APR card through your bank. I think banks are more willing to extend credit to their customers because it is easier for them to foreclose on your checking and savings accounts than it is for outside lenders.

I suggest posting in the finance forum of www.fatwallet.com . There are a lot of people in there who know their [censored] when it comes to credit cards.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

The last time I checked, my score was 700 and would only have gone up since then.

I have some open credit cards as well, not all maxed.


Guess I'll try the CC transfer and report back on my success.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

bump for any novel ideas?

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

Actually man, if your only cards are the ones that are maxed, you will find it difficult to get a great BT card, as you will have utilized 100ish% of your revolving available credit. Your score is likely suffering.

As to finding out your score, the score given at freecreditreport.com and almost any other site is what is called a "FAKO". If you want your true fico score that the lender sees, go to
MyFico.com

At the site below there are discount codes for purchasing the scores.


Check out Creditboards
tons of great credit info there.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

Best Advice Ever [img]/images/graemlins/grin.gif[/img]

Seriously though. Getting new credit cards to do 0% balance transfers is probably not an option giving your current balances and lack of income. DO NOT DO LOAN CONSOLIDATION. This can have adverse effects on your credit score/report.

Assuming you have maxed out your federal loans (or arnt eligible), you next best bet is probably a private education loan.

You should also take a long hard look at your spending habits and cut back on all unnecessary expenditures. I know you have a lot of expenses beyond what government loans will cover, but I'm guessing you probably have some leaks that need attention. Start this trend now and it will haunt you for a long time... even after you start making good money. My college roommate graduated law school with 35k in CC debt and despite making decent money he has made little progress paying down his debt after 3 years. You dont want to go down this road.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

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bump for any novel ideas?

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Well, if you're willing to get your parents or a relative involved, you can get one of them to get a 0% credit card in their name and add you as a secondary cardholder. They should have no problem getting a 10K or more limit. At that point you could do balance transfers to pay off your other cards.

I could understand them being a little hesitant about that, but it would be very easy for them to do and cost them almost nothing depending on their credit status and how much 10K would affect their credit score. That would probably be the lowest cost option for both you and them, assuming that you could definitely pay off the 10K a year from now. It would be cheaper than them cosigning a loan with you, because obviously you would have to pay at least 6-7% interest on that. It would also be cheaper than them loaning you 10K outright because they'd be losing the 5% they could be getting on that money.

I can totally understand why you would not want to ask parents or a relative for financial assistance, but I think that is going to be your only real option given your credit status and lack of income for about a year. Pretty much I think you're going to have to suck it up and ask for help or just be willing to take the monetary hit. That might not be what you want to hear, but I really don't think there are any creative solutions out there.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

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bump for any novel ideas?

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Well, if you're willing to get your parents or a relative involved, you can get one of them to get a 0% credit card in their name and add you as a secondary cardholder. They should have no problem getting a 10K or more limit. At that point you could do balance transfers to pay off your other cards.

I could understand them being a little hesitant about that, but it would be very easy for them to do and cost them almost nothing depending on their credit status and how much 10K would affect their credit score. That would probably be the lowest cost option for both you and them, assuming that you could definitely pay off the 10K a year from now. It would be cheaper than them cosigning a loan with you, because obviously you would have to pay at least 6-7% interest on that. It would also be cheaper than them loaning you 10K outright because they'd be losing the 5% they could be getting on that money.

I can totally understand why you would not want to ask parents or a relative for financial assistance, but I think that is going to be your only real option given your credit status and lack of income for about a year. Pretty much I think you're going to have to suck it up and ask for help or just be willing to take the monetary hit. That might not be what you want to hear, but I really don't think there are any creative solutions out there.

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Yeah, this was the next route I was going to explore. Since my interest rates are so high, I was gonna offer to repay them plus 5%, and it wouldn't even be a full year. My parents have awful credit, so it'd have to be my aunt, but I need to wait until I have a solid firm offer before I ask her, because I wouldn't feel comfortable until I can say, I will be working X job and making Y money.

Re: Debt Consolidation Loan? Student w/ 10k CC debt, but about to make
 

It seems like the rates you currently have on your cards is pretty low. I was going to suggest prosper.com, but I don't think you'll save much after fees since your current rates are pretty low.
If you have a really close family member with a house, maybe they would be willing to take out a HELOC for you and you could just make the payments on that. They of course would benefit come tax time.