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Posts Tagged ‘credit card debt’

Rental Refi Did Not Work

I am kind of disappointed this morning since I found out yesterday that the refinance on the rental homes would not work.  Apparently, my credit score is not good enough.  Ever since 2008, it has been incredibly difficult to get credit so I will be focusing on getting out of debt instead.

Ultimately, it turns out that the net impact on the monthly cash flow won’t be all that different without the refinance.  That is because I had to have 2 appraisals and one came in below the expected amount.  As a result, I had set aside $10,000 to bring to closing in order to save about $650-$700 per month through decreased payments.

Now that the refinance won’t be going through, I will using that money to pay down a credit card balance in order to save over $2300 per year in interest.  Once I get this card paid off which should be in the next few months, I will save almost $800 per month in cash flow which can be added back into the budget.  So all is not lost with plan B.

Plan C

Then once that card is paid off and I get a little more credit card debt eliminated, my credit score may very well be in a better place that I could refi the rental houses, decrease my interest rate and my term.  I don’t anticipate rates moving up any time soon.  I would think that I have a year or more to get a better interest rate.

If not and rates start to increase, that would mean that the economy is heating up which will only help my retirement account investments in the stock market.  So I look at it as a win-win.

With this behind me for the time being, I can now focus on getting the business transaction complete and meeting my 2 goals for this year which are losing weight and paying off debt.  In fact, I am about to launch a blog solely devoted to working my way out of debt which should bring some increased accountability and motivation to the equation.

I will let you know when it is up and running.

 

Carnivals

Here are the recent carnivals that have included articles from my blogs:

Lifestyle Carnival  – CFM, PT
Carnival of Money Pros   – GPM, PT
Carnival of Financial Camaraderie #66  – GPM, PT
Thanks for reading and I look forward to nailing this debt over the next few years.

 

 

 

 

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8 comments - What do you think?  Posted by Cash Flow Mantra - January 30, 2013 at 9:08 am

Categories: Investing, Credit/Debt   Tags: , , , , , , ,

4 Steps to Getting Out of Debt

The following is a guest post:
Falling into the downward spiral of debt can be the worst thing in the world, especially if you have to provide for a family. It may seem like the hardest thing in the world, but there are actions you can take to get your finances back on track and secure your future. With a little planning, pro-activity and determination, there is no reason why you can’t dig yourself out of the hole and bask in the sunshine of financial freedom. Here are four steps that you can take to make this a reality:
Downsize your property
The fact is, when you’re in debt you have to try and cut all the costs you can. One of the biggest money drain people have is their property, which can be detrimental to your finances if you’re living outside of your means. Relocating to a cheaper area and moving into a smaller property is a drastic move, but often necessary. Selling your house quickly through a property buyer prevents breaks in the chain and allows you to relocate at your own speed. There are many sites out there that proclaim “we buy your house” so make sure you do your research first.
Escape the credit trap
While credit cards can be a necessary evil for those people who are financially stable, credit cards and debt don’t mix. Giving up on reliance of credit cards is a must if you want to get out of debt, even though those cash-back bonuses can be a temptation. Make sure that you halt all recurring payments: so track down everything that leaves your bank account on a monthly basis and carry out an audit to slash as many costs as possible.
Switch bank accounts
Nowadays, the internet is your friend when it comes to researching the best current accounts. There are many popular bank comparison sites that list interest, overdrafts and fees. Finding the right account to suit your situation won’t help you straight away, but it’s going to be a fantastic asset to your financial freedom in the long run.
Get help from a charity
When you’re being suffocated by the weight of debt and you feel like you’re alone, don’t worry. There are many charities that have been set up to aid people who are struggling and will be more than happy to listen to you and offer a helping hand.
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10 comments - What do you think?  Posted by Cash Flow Mantra - March 14, 2012 at 9:41 am

Categories: Credit/Debt   Tags: , , , , , ,

Finding Extra Money for Paying Off Debt

Now that I am seeing some progress in paying off the Discover Card, I am really looking into ways that I can find some extra money to do so even faster.  I am liking the fact that if all goes well, I could have it paid off by the end of the year which was a goal of mine for 2012.  However, if I were to really get serious and apply some extra funds, I could get it done by the end of summer.  That would free up some extra cash flow for the monthly budget, although I would probably work to knock out another debt.

Currently, I am paying $460 per month to the Discover Card balance.  This came as a result of paying the minimum on my other debts.  By not adding to my total debts, the minimum payment has decreased on some of my other credit cards.  So last year, as the minimum declined on other cards, I would only pay that amount and increase the amount to the Discover Card since it has the highest interest rate.  I am getting more bang for my buck.  But now, I want to take it one step farther.

Sources of Extra Cash

I have identified some potential sources of extra cash that can be used to pay off Discover even more quickly in addition to the little technique that I have mentioned above.

Recycling Aluminum Cans

We have a lot of people in our family and tend to drink a fair amount of soda out of aluminum cans.  We recycle these cans.  Last summer, I took in a year’s worth of cans that had accumulated in our garage and received $59 for them.  I also took in some a few months ago and got $21.  I haven’t done anything special with the money.  It is still sitting in an envelope.  I should take that money and make an extra payment.  It will be like making 23% interest on a savings account.

Spare Change

My youngest daughter and I wrapped the spare change that I keep in the jar in the office.  We ended up with enough quarters, dimes, and nickels to fill out $64 worth of rolls.  The rest was put back for the next time the jar gets full.  I should take that money and use it for an extra payment as well.  Coupled with the recycling money, I would have another $144 to put toward the Discover debt without crimping my budget at all.

Google AdSense and Blogging

I have already been using some of the blogging profits to make extra payments.  If you read the last post, you noticed that I was able to make a $400 payment using blogging profits.  Well, February was a good month to me on the AdSense front so I will be getting a check at the end of March.  I should take that check and make another payment since I really don’t have any other great use for the money.  That would knock about $130 off the debt.  Imagine how much progress I will be making once I am getting monthly payments.  This blogging thing has been good for debt busting.

Selling Some Stuff

I think I might be so serious about getting this debt paid off that I might even consider going to the trouble of selling some stuff.  Of course the added benefit of cleaning out the house would be a bonus.  Putting together a garage sale is a lot of work, but I am sure that I could get several hundred additional dollars to put toward credit card debt.  I have also read many things about selling books on Amazon or selling on EBay which might be worth a try as well.

These are just the ways that would work for me in order to make some extra cash for debt repayment.  I am sure there are other ideas and would love to hear any suggestions you might have, things that others have done or you have done yourself.  Help me out with a little brainstorming session in the comments.  Thanks for reading.

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20 comments - What do you think?  Posted by Cash Flow Mantra - March 2, 2012 at 5:12 am

Categories: Earning, Credit/Debt   Tags: , , , , , , , , , , ,

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