Dear Credit Union - a letter for you

[MichaelD]

*edit*

I just received an email; I got approved for the full amount! This is super news, folks. I will pay off 75% of my debt with this money. *cries at the amount I've charged up over the years*

Folks are telling me NOT TO CLOSE the accounts. I'm no credit pro; duh, I wouldn't be in this mess. But I want to tell them to shove their pretty plastic cards so far into their collective rectum that the cards tickle their tonsils. :evil:

Thanks for your good wishes; Karma carries, even over the internet.

:beer: <--a toast to the well-wishers

__________________________________________________________________________
Dear Credit Union,

You and I have shared a 6-year, intimate relationship filled with wonderful things. You gave me loans to buy a truck and pay things off. I gave you good business and paid everything off early and never missed a payment.

Now, we come to a crossroads in our relationship; a time of truth-telling. I want to finally pay off all my credit cards and close them ALL except one. I need your help to do this. I'm requesting a loan of $xxK so I can pay them all of now, and pay you back at your more than fair interest rate.

Sure; I could pay them off by myself, but that would take years and cost me a LOT more than the loan from you.

So, please help preserve our already wonderful relationship by approving my loan. Thanks and hope to hear from you soon.

In God We Trust, Everyone Else Pays Cash,
MichaelD


CLIFF NOTES
Applied for a personal loan yesterday. Still waiting to hear yes/no.

 

[frankgomez75]

how bout go in there with a gun and ask 'em for a loan... than you don't have to wait for a yes or no
BTW, good luck on your loan, hope it goes thru

 

[erub]

Originally posted by: MichaelD
Dear Credit Union,

You and I have shared a 6-year, intimate relationship filled with wonderful things. You gave me loans to buy a truck and pay things off. I gave you good business and paid everything off early and never missed a payment.

Now, we come to a crossroads in our relationship; a time of truth-telling. I want to finally pay off all my credit cards and close them ALL except one. I need your help to do this. I'm requesting a loan of $xxK so I can pay them all of now, and pay you back at your more than fair interest rate.

Sure; I could pay them off by myself, but that would take years and cost me a LOT more than the loan from you.

So, please help preserve our already wonderful relationship by approving my loan. Thanks and hope to hear from you soon.

In God We Trust, Everyone Else Pays Cash,
MichaelD


CLIFF NOTES
Applied for a personal loan yesterday. Still waiting to hear yes/no.

What are you offering as collateral? HELOC?

 

[CRXican]

Originally posted by: erub

Originally posted by: MichaelD
Dear Credit Union,

You and I have shared a 6-year, intimate relationship filled with wonderful things. You gave me loans to buy a truck and pay things off. I gave you good business and paid everything off early and never missed a payment.

Now, we come to a crossroads in our relationship; a time of truth-telling. I want to finally pay off all my credit cards and close them ALL except one. I need your help to do this. I'm requesting a loan of $xxK so I can pay them all of now, and pay you back at your more than fair interest rate.

Sure; I could pay them off by myself, but that would take years and cost me a LOT more than the loan from you.

So, please help preserve our already wonderful relationship by approving my loan. Thanks and hope to hear from you soon.

In God We Trust, Everyone Else Pays Cash,
MichaelD


CLIFF NOTES
Applied for a personal loan yesterday. Still waiting to hear yes/no.

What are you offering as collateral? HELOC?

personal loan is unsecured, no collateral

 

[MichaelD]

Originally posted by: CRXican

Originally posted by: erub

Originally posted by: MichaelD
Dear Credit Union,

You and I have shared a 6-year, intimate relationship filled with wonderful things. You gave me loans to buy a truck and pay things off. I gave you good business and paid everything off early and never missed a payment.

Now, we come to a crossroads in our relationship; a time of truth-telling. I want to finally pay off all my credit cards and close them ALL except one. I need your help to do this. I'm requesting a loan of $xxK so I can pay them all of now, and pay you back at your more than fair interest rate.

Sure; I could pay them off by myself, but that would take years and cost me a LOT more than the loan from you.

So, please help preserve our already wonderful relationship by approving my loan. Thanks and hope to hear from you soon.

In God We Trust, Everyone Else Pays Cash,
MichaelD


CLIFF NOTES
Applied for a personal loan yesterday. Still waiting to hear yes/no.

What are you offering as collateral? HELOC?

personal loan is unsecured, no collateral

Yup. My "collateral" with them is that I've had more than $40K of loans w/them over the past 6 years and never been late with a payment and paid every loan off early.

 

[KK]

what interest rate you going for?

 

[MichaelD]

Originally posted by: KK
what interest rate you going for?

9.35 which isn't bad for an unsecured loan. And a LOT cheaper than the rate most of my CCs are at. Citibank bought up a bunch of smaller banks last year. They raised the rate on 3 of my cards from 11-13% to 24%! :|

I called their CS to ask why; I've never been late on a single payment! They said basically "It's our purvue to raise the rate to whatever we feel is proper. If you're unhappy, pay off and close your accounts."

Which is exactly what I'm trying to do.

/fingers crossed

 

[KK]

Originally posted by: MichaelD

Originally posted by: KK
what interest rate you going for?

9.35 which isn't bad for an unsecured loan. And a LOT cheaper than the rate most of my CCs are at. Citibank bought up a bunch of smaller banks last year. They raised the rate on 3 of my cards from 11-13% to 24%! :|

I called their CS to ask why; I've never been late on a single payment! They said basically "It's our purvue to raise the rate to whatever we feel is proper. If you're unhappy, pay off and close your accounts."

Which is exactly what I'm trying to do.

/fingers crossed

No that isn't too bad of a rate for unsecured. I'm debating whether or not using a credit card balance transfer offer I got for one off my credit cards right now. They sent some checks that are for 4.99% for the life of the transfer, of course they charge that transfer fee of up to 75 dollars. Still with that fee, it's a better rate than getting a unsecured loan.

 

[MichaelD]

@ KK,

Unfortunately, a 0% or really low % CC transfer isn't an option for me. I have outstanding debt, and until just recently my debt->ratio wasn't too hot...plus, i really don't want another CC.

This month I paid of my truck (the same CU held the note). I was making double payments ($850/mo) to pay it off sooner so I could then kill my CC debt.

I'm hoping the CU takes all that into consideration.

In your case, you've gotta weigh whether that $75 fee equates to less money in the long run with that sweet 4.99% for the life of the transfer.

 

[Hossenfeffer]

I'm gonna try to do a similar thing here before too long, me thinks.

 

[MichaelD]

Originally posted by: Hossenfeffer
I'm gonna try to do a similar thing here before too long, me thinks.

If you have the "spare money" to do it now, don't wait. Every day you wait, the CC companies make money off you.

I've been waiting to do this for more than a year now. Now that the truck is paid off, I can.

I haven't added any additional balance to any of my cards in almost a year; but the damage was done already, unfortunately.

 

[sandorski]

Unless you're talking 10s of thousands, they'll likely approve based on your past performance with them. I'm guessing.

 

[MichaelD]

Originally posted by: sandorski
Unless you're talking 10s of thousands, they'll likely approve based on your past performance with them. I'm guessing.

Tens of thousands? :Q My goodness, I'm not THAT far in debt...yet. That will come when I buy a house...which is why I want to pay off my CCs.

I have a really good plan. Too bad it took me this long to come up with it.

I hope you're right.

 

[spaceman]

TG for Credit Unions.

 

[j00fek]

id otn see why you shouldnt get it, good luck!

 

[frankgomez75]

Originally posted by: MichaelD

Originally posted by: sandorski
Unless you're talking 10s of thousands, they'll likely approve based on your past performance with them. I'm guessing.

Tens of thousands? :Q My goodness, I'm not THAT far in debt...yet. That will come when I buy a house...which is why I want to pay off my CCs.

I have a really good plan. Too bad it took me this long to come up with it.

I hope you're right.

WOW! Posting at 4:20AM?
I think you'll be OK, considering everything your CU should approve it based on your record and if you have a steady job.

Update us when you find out.

 

[b0mbrman]

Originally posted by: MichaelD
@ KK,

Unfortunately, a 0% or really low % CC transfer isn't an option for me. I have outstanding debt, and until just recently my debt->ratio wasn't too hot...plus, i really don't want another CC.

That's too bad. 0% BT is great

Alternatively, have you thought about Prosper.com?

 

[MichaelD]

Hi there. I have no idea what Prosper.com is and I honestly don't want to find out. I have my retirement plan, my mutuals, etc. I'm not a gambling man and dont' do pyramid schemes.

Anyway...I've not heard from them yet. I'm very familiar with this CU; not only 6 year customer but former GF who I'm still friends with worked there almost 3 years.

I'm sure my app had to go to a senior loan officer to make a determination. I'm hoping for the best. I currently have a really big auto transfer going to them every month; was being used to pay the truck.

If they don't approve me, I'm yanking that transfer STAT.

/stomps foot for emphasis

 

[woowoo]

Don't close those credit cards.
Pay them off but do not close them.

 

[Viper GTS]

Originally posted by: woowoo
Don't close those credit cards.
Pay them off but do not close them.

Yes, definitely.

I know the temptation to close ratejacked accounts but don't give in. Keep them open, don't use them at all, & eventually the rates will return to sanity. Buy small items occasionally to keep the accounts active but do keep them open.

Having lots of credit open protects you from ratejacking, companies aren't likely to try it if they see you have lots of credit available. Ratejacking only works if the victim can't avoid it, no sane person will pay 20%.

The open credit lines also keep your utilization low and average age high which is always important.

I got ratejacked by Chase (they're notorious for it) a year ago, thankfully I had relatives that could bail me out. Perfectly clean credit, never a single derog & they jacked me to the default rate. :| Paid them off and threatened to close the account if they didn't drop the rate. Then I closed the account when they wouldn't cooperate. That last part was a mistake, I should have kept it open and developed a pack a month bubblegum habit. I lost an old account and $12K in tradeline. Whoops.

Viper GTS

 

[MichaelD]

Originally posted by: Viper GTS

Originally posted by: woowoo
Don't close those credit cards.
Pay them off but do not close them.

Yes, definitely.

I know the temptation to close ratejacked accounts but don't give in. Keep them open, don't use them at all, & eventually the rates will return to sanity. Buy small items occasionally to keep the accounts active but do keep them open.

Having lots of credit open protects you from ratejacking, companies aren't likely to try it if they see you have lots of credit available. Ratejacking only works if the victim can't avoid it, no sane person will pay 20%.

The open credit lines also keep your utilization low and average age high which is always important.

I got ratejacked by Chase (they're notorious for it) a year ago, thankfully I had relatives that could bail me out. Perfectly clean credit, never a single derog & they jacked me to the default rate. :| Paid them off and threatened to close the account if they didn't drop the rate. Then I closed the account when they wouldn't cooperate. That last part was a mistake, I should have kept it open and developed a pack a month bubblegum habit. I lost an old account and $12K in tradeline. Whoops.

Viper GTS

Hi there. Good news! I got approved. I'll edit my original post for that.

BUT...I've already been ratejacked (I like that word, BTW) so it's too late for me. THAT'S why I want to close them. I was a good little consumer for so many years. I carried a balance most of the time, never paid late. What did I get in return? A DOUBLING of my interest rate, that's what! :| They can *smoochie* my @zz.

Please explain why I should keep these four accounts open.

 

[Viper GTS]

Originally posted by: MichaelD

Originally posted by: Viper GTS

Originally posted by: woowoo
Don't close those credit cards.
Pay them off but do not close them.

Yes, definitely.

I know the temptation to close ratejacked accounts but don't give in. Keep them open, don't use them at all, & eventually the rates will return to sanity. Buy small items occasionally to keep the accounts active but do keep them open.

Having lots of credit open protects you from ratejacking, companies aren't likely to try it if they see you have lots of credit available. Ratejacking only works if the victim can't avoid it, no sane person will pay 20%.

The open credit lines also keep your utilization low and average age high which is always important.

I got ratejacked by Chase (they're notorious for it) a year ago, thankfully I had relatives that could bail me out. Perfectly clean credit, never a single derog & they jacked me to the default rate. :| Paid them off and threatened to close the account if they didn't drop the rate. Then I closed the account when they wouldn't cooperate. That last part was a mistake, I should have kept it open and developed a pack a month bubblegum habit. I lost an old account and $12K in tradeline. Whoops.

Viper GTS

Hi there. Good news! I got approved. I'll edit my original post for that.

BUT...I've already been ratejacked (I like that word, BTW) so it's too late for me. THAT'S why I want to close them. I was a good little consumer for so many years. I carried a balance most of the time, never paid late. What did I get in return? A DOUBLING of my interest rate, that's what! :| They can *smoochie* my @zz.

I know you already got ratejacked, this is how you avoid it in the future. Keep utilization so low that at any time you could BT any of your balances completely. Having a bunch of maxed out cards is an invitation to ratejack because they know you can't go anywhere.

Glad to hear you've got it handled, hopefully in a few months you'll have options to get out of the 9.whatever% they're charging you on the personal loan.

Viper GTS

 

[kotss]

Actually closing all but 2 or 3 credit cards is the way to go. For each card you have open that is considered towards your debt, wether you have a balance on it or not. I recently bought a new house and had hard time prior to the closing due to cash shortage. And for all the extras in the house we put on credit cards. I was able to organize everything to pay off all the credit cards and then started closing almost all of them. This had a serious effect on my insurance. In New York, insurance is now credit based as well as claims based. By closing all but 1 or 2 credit cards, the quoted $900 for homeowners insurance, dropped to 450-500. My credit score also went up. Now I do not have extra payments each month for all the credit cards and will manage the one I have left very progressively. The one I have left is a credit card through the credit union I have used for over 16 years. The rate is 8.9 %. I really do not want or need another credit card, they are just temptations waiting to happen, I no longer give in. I think you did the right thing.

 

[MichaelD]

Originally posted by: Viper GTS

Originally posted by: MichaelD

Originally posted by: Viper GTS

Originally posted by: woowoo
Don't close those credit cards.
Pay them off but do not close them.

Yes, definitely.

I know the temptation to close ratejacked accounts but don't give in. Keep them open, don't use them at all, & eventually the rates will return to sanity. Buy small items occasionally to keep the accounts active but do keep them open.

Having lots of credit open protects you from ratejacking, companies aren't likely to try it if they see you have lots of credit available. Ratejacking only works if the victim can't avoid it, no sane person will pay 20%.

The open credit lines also keep your utilization low and average age high which is always important.

I got ratejacked by Chase (they're notorious for it) a year ago, thankfully I had relatives that could bail me out. Perfectly clean credit, never a single derog & they jacked me to the default rate. :| Paid them off and threatened to close the account if they didn't drop the rate. Then I closed the account when they wouldn't cooperate. That last part was a mistake, I should have kept it open and developed a pack a month bubblegum habit. I lost an old account and $12K in tradeline. Whoops.

Viper GTS

Hi there. Good news! I got approved. I'll edit my original post for that.

BUT...I've already been ratejacked (I like that word, BTW) so it's too late for me. THAT'S why I want to close them. I was a good little consumer for so many years. I carried a balance most of the time, never paid late. What did I get in return? A DOUBLING of my interest rate, that's what! :| They can *smoochie* my @zz.

I know you already got ratejacked, this is how you avoid it in the future. Keep utilization so low that at any time you could BT any of your balances completely. Having a bunch of maxed out cards is an invitation to ratejack because they know you can't go anywhere.

Glad to hear you've got it handled, hopefully in a few months you'll have options to get out of the 9.whatever% they're charging you on the personal loan.

Viper GTS

OK, now I understand what you're saying. One problem w/your line of thinking though. That leaves me a LOT of available/open credit, something lenders HATE to see.

The end-game for this is me getting a mortgage, hopefully a year or so from now. With..a lot of available credit, they may not be so inclined to give me a mortgage.

Does that change your advice any? One thing for sure; I have learned my lesson.

 

[Viper GTS]

Originally posted by: MichaelD

Please explain why I should keep these four accounts open.

1) Utilization. Even if you pay your cards in full every month after the statement closes your credit report will reflect the statement balance. If you have a $500 credit limit and charge $450 every month (and pay it in full the day you get the bill) you credit report will show 90% utilization. Ideally you should be using as little of your available credit as possible. Your credit score plummets as utilization goes up. Under 10% is a good starting goal, but the lower the better (with a minor hook at the end where going from 1 to 0 can actually cause a slight reduction in score).

2) Average age of accounts. If you close all your accounts and just have your personal loan your average age is going to be terrible. Having accounts open for a long time is a good thing for your credit report.

Viper GTS