Any Advice? Very bad Credit Card debt...

[oz_mark]

Sure, so more interest would only make it worse. Stopping payments will drastically increase accrued debt.

I think Gordo has now stated that he;s sought professional advice - and equally he'll post up for us when / how he's got it sorted (eventually!)

Indeed - that is my take - we'll hear from him again down the track.

 

[QF WP]

Gordo do you have any significant money in superannuation? I believe this can be accessed if you're under 'severe financial hardship.

Given this is in my area of expertise, no he won't. He needs to read and see if his circumstances meet one of the conditions for release, or look at the severe financial hardship information found here. As Gordon has a job and has to have been receiving Centrelink payments for 26 consecutive weeks to be able to apply under severe financial hardship (plus you need a Q230 letter from Centrelink), I very much doubt he will qualify

The maximum amount of funds they will release per year is $10,000. Hardly enough to put much of a dent in his problem, but would relieve a bit nonetheless.

Since the creditors won't really negotiate while your accounts are current, my tactic would not be bankruptcy but simply stop payment on the cards. This will get the creditors into panic mode and they will be willing to negotiate if you threaten bankruptcy. Tell them you're willing to go into a payment plan to pay off a reduced balance if they stop charging interest. When the alternative is to get nothing they'll jump at it IMO.

A viable alternative worth considering.

 

[equus]

It is ashame that these points are not still in the CC acount, you can have converted them to cash with a number of CC accounts.

They still can be converted to cash in effect, even if the rate is not the best available. Even the Qantas FF store has Gift Cards available. Everyone has to eat, and presumably spend either cash or use a CC at a supermarket. Redeeming the FF points for a Coles or Wish card (assuming you do, or can, shop at either Coles or Woolworths/Safeway) will allow you to use the card (which was points) to pay for the groceries. The cash saved can then be used to pay off debt (or at least avoids adding to it).

280K QF points can be converted to $1,900 worth of Coles Gift cards (0.68 cents per point) - not great, but nearly $2K effectively cash in hand.

If there are any points in AMEX MR, the same applies, and the redemption rate is better, up to about 0.8 cents per point, or even better with some of the discounts on offer.

 

[Rick93]

Thanks, that's a great tip, should I need 'emergency emergency' cash.

Certainly hope things never get that bad though....

I lodge my paperwork on Thursday. I'll see how that goes.

regards,
GORDO

 

[KJ Rahe]

Hi Gordon,

My recommendation is to first cut up the credit cards and draft yourself a budget. Determine what you spend your money on and separate them into needs and wants. Until your debts are paid in full you must sacrifice as many of your wants as possible. Example, new set of golf club because your old ones are damaged (this is a want). See if you can save money around you home by cutting back on the things you spend your money on. i.e electricity, mobile phone plan, internet, and go through the list. Drop down phone plans and restrict your calls. Use less electricity and apply these principles to your whole life. It won't be easy. But it takes alot commitment. I mamaged to wipe a 50K debt in 1 year by applying these principles. It was tough Good Luck

You can also call Fox Symes and associates who can help with your debt consolidation. They offer a free phone call service so don't commit straight away but ask questions.

KJ Rahe

 

[vilemerchant]

Hi Gordon,
My recommendation is to first cut up the credit cards and draft yourself a budget. Determine what you spend your money on and separate them into needs and wants. Until your debts are paid in full you must sacrifice as many of your wants as possible.

None of this would work in this case. It might work if you have 20K of CC debt but this guy has 150K. That makes the minimum payments $3000 per month, on top of his mortgage, bills and everything else. The only reason he's stayed afloat is because he can re-spend on the cards after making the payments and do cash advances on one card to pay another etc.

 

[Dave Noble]

I think that he has considered the options over the last month and is taking, what seems to me given the level of debt, the most logical path

After thursday, hopefully he can let us know how his lodgement went

Dave

 

[Rick93]

Hi guys,

Well, I had a two hour session with my 'trustee to be'.

This guy seems to be a 'Mr. Fix it'.

He charges $15,000. though, but I think it will be worth it.

Where am I getting 15K from, given my situation?? Mummy has come to my rescue, but it's only a loan.

If this goes to plan, I'll have her 15K back in less than a year.

$15,000 is a lot of money, but so is my personal debt. ( over 200K )

Now, there's another element, which I alluded to previously.

I have a problem with the ATO ( or rather, they have a problem with me !!)

Without going into it, I have nine ( 9 ) years of fines plus fees to account for.

Mr. 'Fix it' will work on my TOTAL problems, and I will be far better off in the long run.

I used to work 75 hours a week.... week in, week out..... just to stay afloat.

In a few months time, I can settle into a 35 hour Public Service job, have every night at home, have weekends off etc. etc.

My wife & kids only ever saw me come home to sleep. My kids have gone from 'knee high' to teenagers, and I don't really know them !!!

Taking this course of action will give me a life again. I know it's not an 'honourable' thing I am doing.... not paying my debts, and sure, there are many who will call me 'scum', and it's people like me that have caused the economic crisis etc. but I'm also trying to give my kids the father they have grown up without....

It may seem like I'm 'bragging' about going bankrupt, but I do feel ashamed, and I do feel it's not the right thing to do, if you can avoid it..... but I've gone past the point of no return.

My trustee will have to spend some time, sorting out the last ten years of my financial life.

More later.....

regards,
GORDO

 

[serfty]

Cheers Gordon, it's probably too late now but what you are doing could have been done for nothing!

See my 15th January Posts.

 

[Dave Noble]

$15,000 is a lot of money, but so is my personal debt. ( over 200K )

Now, there's another element, which I alluded to previously.

I have a problem with the ATO ( or rather, they have a problem with me !!)

Without going into it, I have nine ( 9 ) years of fines plus fees to account for.

Mr. 'Fix it' will work on my TOTAL problems, and I will be far better off in the long run.

With the other problems, hopefully he can work them out and earn his $15k for you

I used to work 75 hours a week.... week in, week out..... just to stay afloat.

In a few months time, I can settle into a 35 hour Public Service job, have every night at home, have weekends off etc. etc.

My wife & kids only ever saw me come home to sleep. My kids have gone from 'knee high' to teenagers, and I don't really know them !!!

Taking this course of action will give me a life again. I know it's not an 'honourable' thing I am doing.... not paying my debts, and sure, there are many who will call me 'scum', and it's people like me that have caused the economic crisis etc. but I'm also trying to give my kids the father they have grown up without....

It may seem like I'm 'bragging' about going bankrupt, but I do feel ashamed, and I do feel it's not the right thing to do, if you can avoid it..... but I've gone past the point of no return.

Sounds like you will get a life back. I don't see why people would call you scum for taking a thought out approach to dealing with the level of debt incurred. I wouldn't see it as bragging but putting a final chapter to what has been discussed on the thread in what your final decision was

Hope it works out

Just don't fall down the slope again

Dave

 

[vilemerchant]

Good luck Gordon.

 

[Diesellife]

Taking this course of action will give me a life again. I know it's not an 'honourable' thing I am doing.... not paying my debts, and sure, there are many who will call me 'scum', and it's people like me that have caused the economic crisis etc. but I'm also trying to give my kids the father they have grown up without....

It may seem like I'm 'bragging' about going bankrupt, but I do feel ashamed, and I do feel it's not the right thing to do, if you can avoid it..... but I've gone past the point of no return.

regards,
GORDO

Hi Gordon, I'm glad to hear that you are taking steps to get your life back and I'm happy for your kids/wife are able to see you more often.

In regards to bankruptcy, there is no need to be ashamed of. People are more & more accepting these days and perhaps to an extend that they could care less whether you are a bankrupt or not

Moreover, It's partially the banks' fault as well for going over responsible lending... they charge you a premium on interest and accepted the risk involved and now they suffer from the loss - It's all an investment and strictly business.

Perhaps you loss your goodwill but again, your family and your goodwill, which one will you choose? Just be careful not to fall into the same step again as you still have a long journey of life to walk.

 

[drron]

Certainly no bad feelings from me.You have done the right thing.May everything work out as well for you as it has for me.

 

[Evan]

I think its great Gordo has had the guts to tell all of us his issues and resolutions, its interesting to everybody regardless of if they agree or not with what he has done.
I hope it all works out for him.

E

 

[simongr]

Good luck Gordon. The honorable course of action is to do just what you are doing - taking control, ownership and fixing the problem as best you are able.

Good luck to you and you family

 

[Ric]

Gordon, you are doing the right thing. Just make sure you have more quality family time. Good luck mate!

Ric

 

[cove]

Hello Gordon,

Please keep us advised on your progress especially with Amex and the Australian Tax Office as I hear these can be the stumbling block to an early release and a more normal life.

I will get to handle a bit of this over the next couple of years so any up to date info is really helpful.

Good luck with your latest moves.Running a debit cardlooks ok.

 

[docjames]

Good luck Gordo, let us know how you go.

 

[Rick93]

Today, I received a very interesting letter from AMEX.

To date, my AMEX Plat + Gold cards are well overdrawn, and I haven't made a payment on them for about 3 - 4 weeks. ( which must have come to their attention ).

So, today, I received a 'personal' invite, from The Director, to take up a Plat. Charge Card for
$600.00 ( $300.00 off the normal price )

By now, I'm assuming my paperwork has gone through for bankruptcy, and AMEX have been 'notified'.

So, their response? Offer me more credit, in fact a greater level of spending capacity.... NO CREDIT LIMIT !!! One little catch - I'll need to get my other cards in order.....

Sadly, I tore the letter up, and filed it in the 'round filing cabinet' on the floor.

At one point ( not so long ago ), I would have jumped at the offer.... with all the little trimmings.

Those days are gone. I have to be realistic now, and 'rewards' and 'privileges' must come second to responsible spending to keep our mortgage and family going.

regards,
GORDO

 

[docjames]

Well done throwing it away Gordon.

As usual, Amex are useless - imagine offering you more credit when the other ones are overdrawn. Doesnt sound like responsible lending practice to me.