I thought I had everything under control - and then I saw the breakdown of my bills. I owed my creditors $152,323.72.
We had lived in our house for 3 years before we started remodeling. We upgraded our kitchen, the master bath, refinished our basement - everything you were supposed to upgrade to get the best ROI on your house. We didn't pull much equity from our house - there were so many low interest rate credit cards that we figured we'd stay with those, since they were LOW INTEREST.
Well, the remodeling was more expensive than we planned, but since my husband and I had good jobs, we figured we would be able to handle the extra expense... And then my job cut my hours and overtime, which was a loss of $2,000 every month.
I couldn't find a second job to help make up the lost income so we started falling behind in all of our bills: all of a sudden our "low interest credit cards" turned into a huge mountain of credit card debt that we couldn't even begin to think about repaying.
They hit us with higher interest rates when we were late on our utility bills (refer to the universal default clause of your contract - they can raise your interest rate if you're late on ANY bills). Then we got hit with missed payment fees, over-limit fees, and pretty much anything under the sun.
I know we screwed up. We spent more than we had, counted too much on everything staying the same and then we didn't pay some of our bills on time. We tried to refinance to pay these off: we don't qualify. We tried a debt consolidation loan: we don't qualify. We don't qualify for Chapter 7 - the bankruptcy that should help us.
We finally were able to get help from our family. We sold our home and repaid the family's loan.
Luckily we had help: who would have helped us if we were still mired in credit card debt?
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There are other options this family could have turned to consumer credit counseling, credit card debt settlement, Chapter 13 bankruptcy - but when you try all the comfortable options, what else do you do?
I'll add my 2 cents to the bottom of most story posts. Do you have any advice to offer?
