Just got hit with 10.6k in debt unexpectedly

[Tweak155]

So yeah, long story short... I just got hit with 10.6k in debt I wasn't planning on.

Currently it is at 2.99% for the life of the loan.

I technically have the money to pay the bill but doesn't put me with much cushion in the bank considering I'm only 24.

I was thinking a few options...

1 - Throw 5k at it to reduce the ADB and reduce the interest I'm gonna have to pay.

2 - Pay it off and be near broke at the bank

3 - Just suck it up and pay the minimum balance each month for the next 4-5 years...

4 - Transfer the loan to a 0% for 15mo card and hope I can pay it off.

Ideally, I save about 1k a month. Putting this in a 15 mo 0% BT card would be a bit risky at current income. Although I could cut it in half just about and 0% about 5k for 15 months reducing what I need to pay drastically.

I was thinking there are options I don't even know about, like throwing some of my money in a high yielding investment to out-weigh the 2.99%...

What to do? I might just stop at the bank this week and see if they can offer me anything...

 

[Flammable]

mind explaining how? I'm just interested though

 

[shiner]

Here's an idea...if you have the money PAY IT OFF!

 

[tfinch2]

10k at 2.99%? There wasn't an option to get more?

 

[Tweak155]

Originally posted by: Flammable
mind explaining how? I'm just interested though

Yeah I guess I do mind explaining, its kind of touchy...

Just take it for granted I have to do this.

 

[wetcat007]

Let me guess, this involves you lacking some kinda insurance.

 

[isekii]

Originally posted by: tfinch2
10k at 2.99%? There wasn't an option to get more?

lol i don't know why he's complaining.

2.99% is extremely good.

 

[thirtythree]

Well, if you know a way to make more than 3% interest on your money, go with the minimum payments...

 

[Tweak155]

Originally posted by: isekii

Originally posted by: tfinch2
10k at 2.99%? There wasn't an option to get more?

lol i don't know why he's complaining.

2.99% is extremely good.

I'm not complaining... I just haven't paid interest on a credit card my entire life. Interest is just a waste of money... I just seeing if I have all my options covered.

 

[Demon-Xanth]

You got a car, didn't you?

 

[dquan97]

I vote for paying minimum payments. Now, details...

 

[Capt Caveman]

Did you buy a mail-order bride?

 

[Tweak155]

Originally posted by: Demon-Xanth
You got a car, didn't you?

No.

I'm thinking I will throw 500 at it a month to reduce interest accrued and to also knock it out faster.

I'm starting to think I shouldn't have turned down that 70k job. Wisconsin sucks but so does debt.

 

[HomeBrewerDude]

$10,600 worth of lap dances seems a bit excessive

 

[BlackTigers]

how exactly does 10k manage to sneak up on you randomly?

 

[ManBearPig]

Originally posted by: BlackTigers91
how exactly does 10k manage to sneak up on you randomly?

no kidding...how did you unexpectedly get hit with that much effing debt?

 

[Capt Caveman]

Originally posted by: Kazaam

Originally posted by: BlackTigers91
how exactly does 10k manage to sneak up on you randomly?

no kidding...how did you unexpectedly get hit with that much effing debt?

Sounds like he just relocated. 10k in moving costs is easily possible.

 

[yhelothar]

$10.6k at 3% interest is $26.50 a month, given that your balance stays at $10.6k

You're worrying way too much about this.
Just pay back what you can.

 

[Playmaker]

Originally posted by: BlackTigers91
how exactly does 10k manage to sneak up on you randomly?

24, has money in the bank, good career options ($70k/year at 24) ... sounds like the average "uninsured American" the pres candidates keep harping about.

 

[LostUte]

Since the interest rate is so low, I would only make the minimum payments. Paying interest is not bad if you can get a higher rate of return elsewhere. In addition, that 2.99% will most likely be lower than the rate of inflation for the foreseeable future. Just make the minimum payments until it is paid off.

 

[Bignate603]

I wouldn't put it on the credit card... Way too risky. 2.99% on a $10.6k loan isn't too horrible. If you take 4 years to pay off the debt you'll only pay $659 in interest (I had to go look up a site that does car loan calculations). Spread over 4 years that's pretty good.

Here's some scenarios:

Case 1: You pay the minimum each month for the whole $10.6k over 4 years
Monthly payment: $235
Interest paid over life of loan: $659

Case 2: Pay $5k up front, minimum payments on the balance over 4 years
Monthly payment: $124
Interest paid over life of loan: $349

Case 3: Pay $5k up front and pay as much as you were going to when you put it on a credit card
Monthly payment: $941
Interest paid over life of loan: $48.94
Paid off in 6 months

I would suggest going with case 2 or 3. You can pay it off as fast as you want to, but if there's an emergency you can always just pay the minimums until you get back on your feet. Don't put it on a credit card, if something goes wrong and you need some emergency cash you could end up not paying it all off in that 15 month grace period and getting nailed with a 20% interest rate instead of that nice 2.99% rate. $10.6k with that sort of interest rate is pretty manageable.

 

[shiner]

Originally posted by: BlackTigers91
how exactly does 10k manage to sneak up on you randomly?

The night was dark and moonless. Suddenly from the shadows leapt a debt of $10,600 dressed in black and wearing a pair of well broken in Adidas.

As you can see he have no chance to survive make your time.

 

[Auggie]

lol shinerburke

i'd imagine OP was in a vehicle accident without insurance.

whatever the deal is, I'd throw the 5k at it, unless it's in something that you know will return >>2.99% (shouldn't be too hard to see that that happens).

 

[Vic]

The interest rate is less than the current rate of inflation. No way in hell the OP should dump all his savings paying it off.

 

[aesthetics]

I'm going to swing the other way and guess that there is some sort of unexpected medical bill to be paid. That'd also explain his lack of desire to share.