My quick recommendation is that a Consumer Credit Counseling Service is the first solution you should investigate to solve your debt problems. You will benefit from the free budget analysis this type of debt counseling provides and find out how much they can lower the interest on your high-interest credit cards.
Your 615 FICO score eliminates a debt consolidation loan as a solution. Paying it off on your own is not going to work if you are only able to make minimum payments. Very little of your payment will go to the principal. It is going to be a long and expensive route, unless you find a way to cut expenses or raise income, and then pay more than the minimum payments.
These factors lead me to put a CCCS as the primary solution to investigate.
Speak with a Consumer Credit Counseling Service, now, by calling (844) 432-0140. There is no cost and no obligation.
Consumer Credit Counseling Services
Consumer Credit Counseling Services offer a two-pronged approach to getting out of debt. A good Consumer Credit Counseling Service can help you get of debt faster and at a lower long-term cost. Consumer Credit Counseling Services are especially effective for someone, like you, who has high-interest credit cards.
- Budget and Financial Review- Every reputable Consumer Credit Counseling Service starts by looking at your budget, analyzing your income, expenses, debts, and assets. Budget review is a good idea any time someone is under financial strain. A credit counselor will give you unbiased, outside opinion that is free of the pressure you are feeling.
- Debt Management Plan (DMP)- You are currently making only minimum payments. At that rate, it will take you many years to get out of debt and your accumulated interest charges on your high interest debt will be massive. If cutting expenses and spending your money wisely will not improve your cash flow enough to pay down your debts more aggressively, you need a way out of the “minimum payment trap.”
A Consumer Credit Counseling Service can provide you a way to escape the financial treadmill of making timely payments without seeing your balances coming down. It can provide a way out of the “minimum payment trap.” A DMP could help you greatly, depending on the interest rates the program can get in place with your creditors. The credit counseling firm will tell you in advance what rates they can get in place with your creditors and then offer a monthly payment that includes all their fees. The standard program runs 4.5 to 5 years, far shorter than how long it would take you making minimum payments.
- Reasonable fees- Consumer Credit Counseling Services have reasonable fees that are broken into two parts, an enrollment fee and a monthly maintenance fee. State law caps the fees. Enrollment fees range from $25 to $75 and monthly fees should not exceed $50.
Why Choose Consumer Credit Counseling Services?
Based on the debts you have and an analysis of the available options, I recommend that you speak with a reputable Consumer Credit Counseling Service, to hear exactly what kind of plan can be put together. Here are the main benefits I see for you:
- Professional Assistance -Do-it-yourself solutions, while worth exploring, are tough to accomplish. You can try to lower your own interest by speaking with your creditors, but a credit counseling service will lower your high-interest debt. Your high-interest credit card debt is just the kind of problem that credit counseling works best on. The Consumer Credit Counseling Service will give you a defined plan, so you know exactly when you will be debt free if you follow the plan.
- Reduced Stress - Working with a quality Consumer Credit Counseling Service will reduce your stress. You will benefit from the free financial and budget review.
- Credit Score- Your score is too low to qualify for a debt consolidation loan or balance transfer. Make sure that no payments are missed in the initial phase, when your DMP is getting set up.
- Affordable Payment -You have good income, are making your payments on time, and may even reduce the required monthly payment slightly in the DMP. Not being able to afford the monthly payment is the biggest cause of dropping out from a Consumer Credit Counseling Service. As many as 75% of customers that enroll drop out, mostly due to committing to a payment that they can't make.
- Get out Debt Faster- You probably can accelerate your DMP, because the monthly DMP payment should be smaller than the payment you are making to your creditors. If you are able to free up any more money during the program (money you use for a car payment that ends, for example), then you can finish the program even faster.