So, I started checking out rates yesterday. I figured with the feds cutting rates, maybe banks would be more open to loans. Turns out, I got turned down almost everywhere except for one main financial. They wanted to pay off the remaining 13k on my car loan and use that as collateral (which is the same value as the loan) but it wouldn’t cover all my debts, so I said no.
Now, some people are reaching out to me suggesting to negotiate with my creditors and stop paying my credit cards. But I’m not feeling that idea. I don’t want to mess up my credit score even more.
Do you think a traditional bank would be more open to giving me a loan? I tried applying to different online places and even Discover (who I already have a credit card with). It’s looking pretty bleak right now. I really want to get this sorted out sooner rather than later.
Sincerely,
Financially Frustrated Flo
Response from THE MONEY MINDER:
Hello There,
I’m sorry to hear about your current financial situation. It sounds like you are taking proactive steps to address your credit card debt, which is commendable. Consolidating your debt with a lower interest rate loan is a sensible approach to paying it off quicker and more efficiently.
Given that you were denied by most lenders and received offers that may not be the best fit for you, such as using your car as collateral, it may be worth exploring other options. Traditional brick and mortar banks may have different lending criteria compared to online lenders, so it could be worthwhile to visit some in-person and discuss your situation with a loan officer.
In the meantime, continue to make your minimum payments on time to avoid damaging your credit score further. Negotiating with your creditors directly is also an option worth considering, as it may lead to more manageable payment plans or reduced interest rates.
Additionally, reviewing your budget and expenses to see where you can cut back and allocate more towards your debt repayment can also be beneficial. Focus on paying off the highest interest rate debts first while maintaining minimum payments on the others.
Remember, tackling debt is a journey, and it may take time and effort to reach your goal. Stay committed to your debt repayment plan and seek out financial resources or counseling if needed. You’ve got this!
Best regards,
THE MONEY MINDER
