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MONKS asked in Business & FinanceCredit · 1 decade ago

Have $25,000 in bills...have great credit..having trouble getting a loan to consolidate...why? PLEASE HELP!!?

I have a credit score above 700..which is really good......make around $34,000 a year...and dont pay rent..I have a credit card that I owe $7000...10% interest...unsecured loan that I owe $5,500..14% interest rate...car loan I owe $13,900 8% interest rate...and I'm NEVER behind on my payments....how can I get a loan to consolidate these bills into one monthly payment with a decent interest rate if I have no collateral??? I applied to bank of america for a unsecure bill consolidation loan for $30,000 and got denied. Do I have any other ways to solve this problem????? Please help me :)

8 Answers

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  • keiko
    Lv 7
    1 decade ago
    Favorite Answer

    If you try for debt consolidation, go to the Better Business Bureau and the attorney general in your state. They can warn you off the rip offs. I've heard that sometimes you end up owing more because of the debt consolidation fees. Be careful and good luck.

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  • 1 decade ago

    Even with great credit, you are not going to get a loan for that large amount of money without collateral.

    I would begin with stop making the minimum payments if you have not already started doing that. Start paying the minimum on everything except the 14% unsecured loan. Throw everything you have at it. When it is paid off, move to the 10% credit card and throw everything you have at that while making minimum payments on the rest. Continue this until everything is paid off!!

    My only other thought is to check and see if your credit card or another credit card company will give you a special deal for 0% for say... 1 year. Then transfer the debt to that card at 0% and throw everything you have at knocking it down. That way you aren't accumulating interest.

    If you are really really really in a pinch and have no cash to spare, you could always sell your car for something less expensive. That interest rate is not the best... possibly get refinance it.

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  • 1 decade ago

    Do you own any real property which could be used for collateral? If not, do you have a 401-K or annuity from which you could borrow? If not, do you have a family member with collateral and good credit who would co-sign with you? If the answer to all of these is NO...then I suggest that you make minimum payments on the ones with the lowest interest rates, and double or triple the payments on the highest interest account, to pay it off first. Then start on the next highest, etc. until they are all paid.

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  • Anonymous
    1 decade ago

    First, the bad news:

    A high FICO score is no guarantee of getting yet another loan.

    You now have so much debt that your FICO is being hurt by your debt/income ratio.

    -------------

    Now, the good news:

    YOU CAN BE DEBT FREE IN 12 MONTHS.

    Making $34,000/year, no rent, and $25,000 in debts.

    Here's how you're going to get yourself out of debt:

    1) SELL THE CAR.

    Buy a $2,000 used car, and drive that until you pay off the rest of your debts.

    2) "I solemnly swear, I will never use a credit card, borrow money, or get a car loan again. And I will put all my efforts toward getting out of the debts I'm in."

    3) Write up a detailed written budget.

    Every month, before you get your paycheck, write down on paper what you will spend your money on.

    4) Make sure your budget is balanced.

    That means (money going in) = (money going out)

    Some of the money going out can go out of your wallet and into your savings account.

    5) Squeeze out as much money as you can.

    That extra money will be the tool to use to get yourself out of debt, and on the way to saving toward becoming rich.

    6) Once you have the budget, and money to work with, here are four goals to hit, IN ORDER,

    First, get current and just pay the minimums.

    Second, get $1,000 cash saved up.

    Buy a $5 picture frame at Wal-Mart, put the ten $100 bills in it.

    Put a sign in the frame: "In case of emergency, break glass"

    You'll use this, not your credit cards, if the transmission breaks.

    Third, go on the attack. Every dollar attacks the smallest debt you have. So kill it.

    Fourth, attack the second-smallest debt, etc.

    Look at this budget, and tell me if it's realistic, assuming you're serious about being completely out of debt in 12 months:

    Salary: $34000 ($2833/mo)

    W-4: Single-1

    401K: -0- (pay off debt first, then invest)

    State Income Tax: 6%

    $2,150 Monthly Income after taxes

    $1200 Savings / Debt Repayment

    Pay the minimum on the credit card, and the rest on the unsecured loan.

    FOOD

    $80 Groceries ($20/week. Beans & rice and Ramen noodles. No steaks. When I was unemployed, I stretched $11/week to feed myself, so I know this is realistic.)

    $-0 Restaurants (The only time you'll see a restaurant is if you're cleaning tables at your second job. No hamburgers.)

    SHELTER

    $-0 Rent (Free Rent - Great)

    CLOTHING

    $20 Clothes (second hand, or one new shirt a month)

    $30 Laundry (Laundromat. If you own a Washer/Dryer, add this $30 to 'debt repayment')

    THE CAR

    $-0 Car Payment (you sold the car and bought a broke guy's car, right?)

    $300 Gasoline ($75/week, one tank a week)

    $10 Oil Change (once every 3 months)

    $80 Repairs (You know something will break, so save this in a separate envelope, and be prepared)

    $60 Car Insurance ($360 per 6 months)

    $-0 Car Replacement (pay off the debt first)

    $10 License and taxes

    UTILITIES

    $70 Electricity

    $20 Water

    $80 Natural Gas

    $105 Phone/Cable/Internet

    MEDICAL

    $5 Doctor/Dentist ($60/yr)

    PERSONAL

    $30 Household Stuff (soap, toothpaste, etc.)

    $10 Hair cut (A $20 haircut every two months)

    $20 Christmas Gifts (Don't put Christmas on Visa)

    $20 Entertainment

    $-0 Vacation

    Once you pay off the debts, that $1,200 will go a long way. Put $500/month into retirement, $400 toward a house/apartment (I doubt the rent-free arrangement will last forever), and enjoy the other $300.

    Source(s): www.daveramsey.com
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  • 1 decade ago

    Start by selling the car and buying a new car with however much cash you have on hand. Then get on a no-nonsense, written budget. The only areas that you need to concern yourself with right now are food, shelter, clothing and transportation. Once those are taken care of, then you can attack your debt. You story is yet another example of why the credit score is a complete scam that the credit industry wants people to buy. The credit score means absolutely ZERO in terms of your financial health.

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  • Anonymous
    1 decade ago

    Credit score and credit report both are equally important to get a loan. So might be there may be something wrong with the credit report. Check your credit report.

    I know a debt consolidation company namely http://ezconsolidation.com where you can get a consolidation loan at a low interest rate so that you can consolidate all your debts into one. You can also try for a debt management plan.

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  • 1 decade ago

    Try www.firstcommandbank.com

    They approve a loan with no collateral up to $25.000 with good credit of course. Good luck.

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  • Anonymous
    1 decade ago

    you cant get a loan because you've exhibited extremely poor judgment in your handling of personal finances.

    Source(s): Your score means nothing
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