OT' anybody have an experience with debt consolidation??

I know this is totally off topic but I don't have anyone else to ask. My married daughter is experiencing debt problems due to doc. bills and credit card debt for major house repairs and car repairs. She and hubby both work hard and have two small kids that I babysit daily. They are trying so hard to find a way to get the debt down to a reasonable amt. (they owe about 7,800 total). Does anyone have any experience using credit consolidation companies. Any advice on how to best manage this situation so that they can free up enough cash to not feel so stressed. I feel so sorry for them because the doc bills just keep coming (kid had surgery, hubby has chronic back and dental probs.-they are only 28 yrs. old)- I don't have the money to help them but would like to be able to advise them properly so they don't make things worse. Thanks- GG

Go find Dave Ramsey's website and see what is available there. I catch his radio show occasionally when I am driving late in the evening. He is super! I run my finances on his philosophy and have before I ever heard his show.

Don't let them get hitched up with a "debt consolidation company" that will make things worse for them. Dave is always warning about the crooks in the market.

Having a market is a wonderful thing but we consumers have to do our part and know what we are doing.

I am a retired credit manager and I do not recommend those debt consolidation companies........they make good money by taking a share of your payments. I would go and see the bank that you deal with, they are usually eager to help with consolidation and can offer some very good advice. If they own their own home, borrowing against the equity is always a wise decision in the long run. You may pay more interest that way but once you are out from the crunch they could make larger payments to reduce the interest faster.
I wish them good luck, this is not a good time to be in debt due to the economy, but when you are between a rock and a hard place, its the only thing to do. I just got my daughter to do the same thing, now whe's breathing so much easier. Once the economy gains some momentum and she is making more in wages, she can pay off what she has borrowed in a quicker manner.

Debt consolidation companies are often sponsored by credit card companies--
any dirty trick they can pull to put off BANKRUPTCY.
Bankruptcy gets a bad rap; but look how many millionaires have done it!
They just don't want 'us' doing it.

nanwilson-did you mean that your daughter got an equity line?? My daughter and hubby have only owned their home for about 5 yrs- would they have enough equity to get such a loan?? Thanks-GG

So Well wrote:Go find Dave Ramsey's website and see what is available there.
Don't let them get hitched up with a "debt consolidation company" that will make things worse for them.

That hits the nail on the head. I have been listening to Dave Ramsey's radio show for several years and his advice is sound and simple.

They should look at Dave's "Seven Baby Steps" - http://www.daveramsey.com/new/baby-steps/

Very important that they only work on one step at a time in the order Dave presents them.

It sounds like they are motivated but they really need to start listening to Dave's show at least a couple of times per week. He is a great motivator and listening to him will make the Baby Steps easier and even fun.

If they go to the website they can find a radio station in their area that carries his show. You can also listen to the show live on the website and podcasts are available free.

As Dave says, "Personal finance is 20% head knowledge and 80% behavior."

grumpygirl wrote:nanwilson-did you mean that your daughter got an equity line?? My daughter and hubby have only owned their home for about 5 yrs- would they have enough equity to get such a loan?? Thanks-GG

Hi GG
Depends on the value of their home today...have the prices gone down or up..and did they put a substancial down payment when they bought it??????? Get them to check with their lender, rules are different in every area. If they own a car outright that would help them out too, whatever equity they have, they can use. They need to talk to their banker.

nanwilson- They really do not have the money for closing costs or appraisals or anything that might be required to obtain an equity line. They did not have a large down payment when they purchased the property and the prices in this area have risen somewhat but not greatly. I think a talk with their bank would be in order!! Thanks so much for the help. GG