Active duty service member trying to get out of debt.
 

Hey guys, this is my first time posting in here but I'm 25 and am looking to consolidate my debt while improving my score.
I'm active Duty navy (MA a little over 4 years) and have a few loans through Navy federal. my situation is I want to consolidate my debt and finish my car by the time I get married (Feb 2016). When I turned 18 I opened credit cards with no job and rang them up and never paid them until recently. Im am currently getting Creditrepair.com to send inquiries and challenge the credit companies to drop them and improve my credit. Creditrepair.com service is $90 per month
Here is a list of my monthly bill expenses and interest rates for the loans.
Nave Federal VA Home Loan- $129,730 (3.375% interest) $766 per month
Navy Fed Personal loan- $8,000 (17.75% interest) $232 per month
Navy Fed vehicle loan (07 TL)- $12,000 (7.24% interest) $206 per month
Navy fed Credit card- $6310 (owed, limit is $8k) (16.65% interest) $200 per month
I estimate it will take about another $6-7k to finish my car.

I got in way over my head with the loans and such a couple years ago when my credit was really, REALLY bad.. Now its improving and I have a 686 score.

Any help, tips, suggestions or options from some wiser people? I know I messed up but I realize it and I am trying to get it all corrected..

$2580 -- E5 over 4
$667 -- BAH/BAQ
$367 -- BAS
$3614 per month

Even with taxes on base pay you seem to have plenty to pay those bills.

$14,000 in credit card/personal loans is just stupid. (Sorry, but that's it.) Shred your credit card. Stop paying minimum payments.

I'd ignore finishing that car until everything but the home mortgage is paid off. It's not a prioirty whatsoever.

-- Chuck

Trust me Im fully aware how stupid those mistakes were.. I wish I could find a loan big enough to pay it all off at once and have a little left over o finish the car.

refi your personal CC/Loan. Those interest rates are insane. Screw fixing the car. Pay off these loans as quick as you can. You are paying crazy high rates.

Waiting for a few things to fall of my credit report and when they do and my score goes up, ill refinance for sure.

Satansedan,

There was a guy who was in relatively worse shape than you, but the whole forum gave him a shload of advice. You can check out that thread here.

find a unit going on deployment, may be the quickest way out. combat or MEU would be nice.

UT- I was thinking the same Chris thread.

OP- If you have a car and house already, it's likely that the big purchases that are impacted most by your credit score are out of the way for now. Unless you're planning on taking on ANOTHER loan in the coming months, the long term continued improvement of your credit score might be good enough than paying a service that might increase it. Saying that:

You're wasting $90 a month that could go towards one of the loans.
You should freeze the other 6-7K of car work you're doing (unless it's a requirement to get the car drivable, AND it's your only mode of transportation).
There's probably little value in prepaying the car loan you have.
There's plenty of long term value in prepaying your mortgage, however, not until you're out of the debt situation you're in.
You should consider attacking the other loans either by highest interest (you'll save the most) OR by the smallest amount owed (the satisfaction of eliminating a loan and having an achievable goal).

Good Luck. Most important, you have to stop spending and not increase what you owe. If you keep spending on discretionary items, you're battle becomes that much tougher.

G

Not what you want to hear, but sell the car and buy a $500 beater to get you through the time. Follow Dave Ramseys baby steps, and put a budget together so you can follow exactly where your money goes.

^This.

My opinion on debt consolidation is a "hard reset." You have interest coming, every month, and a LOT of it. Drop anything you have that is not necessary and has a good amount of equity in it. If you don't have a lot of equity in your car, you should still consider buying a crap car and selling your current car to get out from under the loan (you will likely still have to put up some cash).

Trust me, it seems like a lot of work but this will be the FASTEST way to get back to your higher standard of living/lifestyle by being poor/cheap for a little while. People that try to "eek" their current lifestyle and make small changes like "I wont go out to eat anymore" or "i wont go to the movies anymore" are just freaking kidding themselves. It works, but it takes FOREVER and a lot of willpower to not do those things for a REALLY LONG TIME... that's where most people fail.

Drop the credit repair crap. Those places (almost literally ALL of them) are well-known to be straight scams. The people who get on board with them have very poor knowledge of finances and think that they can buy people's time and a "low price" that will "pay for itself." Wrong. They're feeding on your ignorance and laughing. Your credit score will improve if you.... surprise surprise... GET OUT OF DEBT or at least LOWER it.

With what you're making, you wouldn't have to go very long living cheap and with a crap car. You could be back in something nice in a short amount of time.

Dave Ramsey's advice is so simple, but it works so well. It's the knowledge we all have and have likely thought about, but never applied. My brother and sister in law turned me on to it. It led to my wife and I becoming debt free besides the house in what seemed like no time at all. My brother and sister in law are out of debt as well. Took them a little longer as they had more debt, but they stuck to it and are loving it now. Tackle the highest interest first and pay the minimum on the rest. Once the highest is gone, go to the next highest interest. Keep adding the money that you have freed up to the next bill. It's called the snowball effect. You would be amazed how fast you can eliminate debt if you put your mind to it.

There is nothing like being out of debt my friend. Keep thinking about all the extra money you would have if you didn't owe anyone money! The stress relief alone should be enough motivation to get you head strung on it. I highly suggest you listen to Ramsey's total money make over.

I'll share my experience as best I can remember for some motivation to let you know you can do it. I had a fancy brand new fully loaded Tacoma (Owed $18k), Medical bills ($15k), student loans ($5k), a 20% mortgage ($18k), and my wife had about ($6k) in credit card bills and money owed to family. I also had 2 motorcycles that were paid for. When my wife and I decided to get intense on this debt we owed, we took drastic measures. I sold the truck and got an older paid for Tacoma. I sold both my motorcycles. We sold her car and got her a beater car. We took all that money and threw it at our debt. The snowball effect really took a hold and fast. Getting rid of the Tacoma alone freed up $550 a month when you added up the payment, property taxes, and insurance. Selling my motorcylces freed up about $10k to help pay off my medical bills. So with the Tacoma gone and the medical gone, that was $780 to throw at my student loans. Once that was gone I had $880 to throw at my wifes debt. Once that was gone we had $1180 to throw at the mortgage. Once you free up all that money it is amazing how fast you can knock out a $10k plus debt. And that "freed up" money is just that, freed up money. That doesn't take into account what you were already paying on the debt.

Everyone's money situation is different, but it doesn't matter if you clear $1500 a month or $8000 a month, the principle is the same. Don't be afraid to let go of something that you may feel is important to you at the moment. You can ALWAYS buy another down the road. And think, instead of owing for that something, you could buy it straight out by just saving for a little while with all that freed up money you will have.