Question for the Money Doctors

Question submitted on Mar 12, 2011.

Question

I have a balance of $9200.00 but I am $1200.00 past due. Is there any hope of paying this card off by paying 100.00 a week? Will paying 100.00 weekly help cut down on interest charges?

Answer

Thank you for the question.  By paying $100 per week, it should take you about 26 months to pay off the card (assuming a 20% APR).  So, yes, there definitely is hope for paying the card off.  Paying $100 per month will cut down on the interest charges a little; but more importantly, it will probably make it easier for you to make the payment through cash flow.  Paying $100 per week is easier than paying $433 per month for most people on a fixed budget.  

The $1,200 past due would concern me though because you can continue to incur extra fees and increased interest rates.  If you have the ability to roll the balance into a new card (preferably one with a low APR), then that might be a good option.  If you don't have that option, try contacting your credit card company and making them the offer of paying $100 per week.  Ask if they will waive any late fees and penalties and give you a reasonable interest rate if you make weekly payments.  Most likely they will try to play hardball with you, but be persistent and ask to talk to a supervisor.  If they agree, try to get them to put it in writing.  At the very least get the name and contact information of the person who authorizes the deal. 

I hope this helps.  Good luck.    

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