I searched for others in similar situations and found a few close matches, but nothing quite like ours.
My husband and I have about $42,600 in credit card debt. We have a combined income of $230,000, with a $4,300 monthly mortgage. Our take-home pay is around $11,000 a month, and we don’t have any car payments.
I’m putting most of our remaining money towards credit cards, but with APRs as high as 29%, we’re not making much progress.
- Card A: $8,600 at 29% APR
- Card B: $16,000 at 26% APR
- Card C: $18,000 at 29% APR
Over the past year, we’ve paid off about $10,000, but expenses for our new home kept us from making more progress.
We’re looking for the best strategy. Some suggest a balance transfer to a 0% APR card, but most offers we’ve found only approve around $5,000. Does anyone know of cards that offer higher limits?
Another option could be a personal loan. I checked SoFi and qualified for a $50,000 loan at 14% APR with a $1,100 monthly payment over 5 years. We’re already paying more than that, so we could pay it off faster.
Or should we stick with the snowball or avalanche method?
I chose to pay off my consumer debt with a personal loan; it’s much simpler to make payments once rather than several times, and the lower interest rate makes it seem less unachievable. In order to avoid ending up here again, make sure you at least freeze or lock those cards and pay as much above the minimum amount due each month.
We are currently contributing about $3,000 a month to them. however a few health and animal-related problems that we overlooked arose. The goal would be to pay it off in two years with ease.
It’s really high that housing accounts for 40% of after-tax income. That will probably result in long-term debt for all of you. I make 190k, which is half of what you guys make, and I still struggle after splitting a mortgage with my girlfriend.
I employed the tried-and-true Dave Ramsey snowball strategy to assist me in paying off debt. Personal loans, in my opinion, are a bad idea since, like myself, many individuals take them out, use them to pay off debt, and then start using the credit card they had just paid off.
I think the person in question doesn’t want to hear that his house is too high, but it actually is, and I’m worried that should things go wrong in the future, they’ll find themselves in a similar situation.
I know I’m not really “helping,” but in my opinion, having such a large mortgage on just $230,000 is a death sentence.
Transfer of balance and avalanche as much as possible. Citi credit cards are useful; I received 8,000 for a balance transfer. If interest is being accrued, a personal loan would be a better choice because, well, the average annual percentage rate will be high. Best of luck
Curious, which Citi card did you choose?
Essentially, the interest is the same. Here, avalanche is not relevant. snowball will be the most effective.