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Personal Loan?

March 19th, 2009 at 06:44 pm

Still frantically trying to save for leave, before baby comes. We have 14 weeks to go, if I carry to full term. We're about $700 behind schedule, but we'll get there. We still have the biggest savings account we've ever had!

Since we've been focusing on saving, we haven't been putting extra towards the CC debt. It kills me to just pay minimum, so I have been doing extra on the highest APR card. But now it seems everyone is jacking up the rates.

We have 3 small cards(still have a very ugly Discover card balance at 13K at 17% and a 2500 Visa at 7.25%) Our BOA is $1080, at 19.99%; Capital One $830 at 22.9%, and Home Depot $1100 at 22.4%.

My question is: would it be in our best interest to get a $3000 personal loan from our local credit union, and just pay off those three? The CU website has 'rates as low as 7.25%', but I figure even if they were 10%, it's still lower than the credit cards. I feel like it would be some load off of our shoulders to pay something off. Or just keep paying minimum and not stress until after baby comes and we see what THOSE expenses are like!

I did recently pay off our Care Credit, and only owe 2 more $200 payments on one loan.

We're making progress, just not as fast as I'd like.

Posted in budget, choices | 4 Comments »

4 Responses to “Personal Loan?”

  1. creditcardfree Says:
    March 19th, 2009 at 07:21 pm 1237490516
    1237490516

    I know a lot of people are getting their rates increased by credit cards. Some of them have a clause in fine print on the letter, that allows you to call and opt out of the new rate. There may be a catch, such as paying the balance off in X period of time. Did you look at your notice?

    I'd check into all of that before getting a personal loan, but it doesn't sound like a bad idea if you can handle the one payment and keep sending in more in the meantime.

    Good luck!

  2. Jessica Says:
    March 19th, 2009 at 08:25 pm 1237494307
    1237494307

    I would never, ever take out a small personal loan to pay off CC debt. If you call and can't opt out like prior person said I would start transfering to a 0% intr promo card. This is only if you plan on paying these things off by the alloted interest free time. Try to find a card with no balance transfer fee. I transfered mine and paid 3% on the transfer amount but it maxed out at $75. I didn't know there were ones out there that didn't have a transfer fee but the $75 was worth it. I was no longer paying interest on the other cards. Again be sure to know the monthly payment (in order to have it paid off by the end of the promo) and make it so you don't get hit when the regular interest kicks in. Good luck and congrats on the baby.

  3. babymakes3 Says:
    March 19th, 2009 at 09:20 pm 1237497622
    1237497622

    Not sure if we can transfer any balances, since the Home Depot and BOA card are both closed. The Cap One card is still open, the rate is going up April 1st, and it can stay at the 14.99% if we close the account. Fine, we'll close it, that doesn't matter. But the rate will still be higher than the CU, which I've had 2 car loans, and 2 personal loans through them, (all paid off). Not sure if we can transfer balances since THEY closed the accounts, or if I even want to get into the balance transfer dance.

  4. Apprentice Bliss Hunter Says:
    March 20th, 2009 at 01:51 am 1237513895
    1237513895

    Personal Loan - a fixed payment over x years. Cut up the cards for good.

    This only works if you don't run up CC balances again - obviously :-)

    Do you think you could handle the repayments on Personal Loan when the baby comes ?

    If you do, I would probably go that route- a lot better interest rate and you've getting closer to being CC debt free....

    Congrats on your pregnancy !! :-)

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