Robert Powell Special to USA TODAY Published 11:43 p.m. UTC Jul 18, 2018 Question: I’m 64. My credit score is about 656. For different reasons over a long period of time — including unemployment and health issues — I accumulated credit card debt of about $50,000. I intend to take out an unsecured personal loan, but I don’t want it to have a negative impact on my credit score. I have a job now and I will pay my monthly payments on time. But what will happen if I cannot continue my payments to the lender? If I should file for bankruptcy, which is worse: defaulting on credit card debt or an unsecured personal loan? If I try to negotiate a reduction of my debt with the creditors, do you think this procedure will be successful and not take too long? And what is a nonprofit debt relief company/agency, and how could they help me? Bottom line: What strategy would you implement to resolve the debt problem if you were in my … [Read more...] about How do I get out of $50,000 in credit card debt: personal loan or repayment plan?
I have bad credit but need a personal loan
Credit scores are needed to qualify for a car loan or mortgage. And the way you establish a credit history is by getting a credit card, right? That's a familiar personal finance myth that has led millions of Americans to get their first credit card -- and risk falling into high-interest debt, experts say. The average American in 2017 had two-bank issued credit cards and carried $5,551 in debt, according to the credit bureau Experian. Collectively, Americans have $1 trillion in credit card debt, more than any country in the world. Here are four ways consumers can create a credit history without falling into the credit card trap. Report monthly bills like rent and utilities Bills like rent and utilities traditionally aren't used to create a credit history – only loans are. But new companies and scoring models are springing up that include monthly bills like rent, said Robert Harrow, a credit card specialist with ValuePenguin. Those bills include rent, cell phone, internet, … [Read more...] about 4 ways to build good credit without using a credit card
Carmen Reinicke CNBC Published 6:00 p.m. UTC Jul 9, 2018 You've watched your children or relatives celebrate college graduation, move to new cities and start first jobs. You might be settling into life with an empty nest, or simply enjoying one less person in the house. That is, until your child brings up student loan refinancing and asks if you will help by co-signing. Student loan debt in the United States has climbed to more than $1.48 trillion, a record amount. The average student loan debt for the class of 2017 was nearly $40,000, according to Student Loan Hero, an online resource for managing student and personal debt. This represents a huge financial burden for 44.2 million Americans and can take years to pay off. More: Borrowing for college? 3 ways to avoid getting trapped in a bad student loan deal More: How some students are lowering or avoiding college tuition and student loans More: Student loans have become our modern-day debtors prisons Currently, interest … [Read more...] about Piggybacking on good credit: Things to consider before co-signing a student loan
By Jason Steele/Credit.com Beyond the cold weather and snowstorms many Americans are facing this winter, a lot of us are also staring down a large tax payment. And when it comes time to pay what we owe, we actually have several choices when it comes to the method of payment. Unfortunately, many of us choose a form of payment that costs more than we thought it would. The cost of paying your taxes with a credit card The Internal Revenue Service authorizes several companies to accept credit card payments on its behalf. While this can seem like an easy way to make a payment, these companies charge significant fees. The fee for credit card acceptance starts at 1.87 percent of the amount paid, and can be as high as 2.35 percent. So someone who chooses to pay a $4,000 tax bill with a credit card will incur between $74 and $94 in fees. These same companies will also accept debit cards at a much lower cost, between $2.49 and $3.50 per transaction. So in most cases, taxpayers who are looking … [Read more...] about Should I pay my taxes with a credit card?
By Jeanne Lee/NerdWallet Most people consolidate debt with a personal loan or a balance-transfer credit card. Others tap the equity in their homes. These options all come with risk. By comparison, taking a 401(k) loan might look benign -- but it could be the riskiest choice of all. Most 401(k) plans allow users to borrow against their retirement savings. "About 1 in 5 of our plan participants do have a loan outstanding," said Meghan Murphy, a spokesperson for Fidelity Investments. Interest rates on 401(k) loans are low -- typically one percentage point above the prime rate -- and interest payments go back into your account. But if you lose your job, you face accelerated repayment or taxes and penalties. Ten percent of 401(k) borrowers default, according to the National Bureau of Economic Research. Of those who leave their jobs with a loan outstanding, 86% default. Even a fully repaid loan dents your retirement plans. The money you borrow won't earn investment … [Read more...] about How to pay off debt with a 401(k) loan: Very carefully