I'm Here...Just Under the Weather

Just a quick note to let everyone know I'm still here. I usually post daily, but over the weekend I picked up some type of bug. My poor little guy got it too, so we are two happy campers - LOL.

He's already feeling better today so I should be almost back to normal hopefully tomorrow, which is good because that means May 31 updates :)

May Monthly Debt Payments

Here's the May update on the minimum monthly debt payments.

Mortgage: $337
Auto Loan: $258
School Loans: $208
Credit Cards: $743

The grand total for May $1,546 / month. A decrease of over $200 from April!

Just a note, the auto loan will be paid off in September! Only a few months left to go on that one and that payment will be snowballed towards other debt payments as well :)

It Was Hard to do, But We Made a "Fun" Purchase

Part of the compromise with my husband was to spend some money on "fun" things this summer. I admit, I was so focused on eliminating debt that I soon forgot about having some fun. After we put them in our shopping cart, I told my husband to head for the check-out before I change my mind - LOL.

We bought one 2-Person inflatable kayak and one 1-person.



And let me tell you, we took them out today and had a blast!! My son keeps saying, "Thank you for the fun day." It was worth the purchase price to see the smile on his face as we were paddling across the lake.

I have a feeling we will get a great deal of use out of these kayaks and I know they were worth the money. And the best part of all - they were paid with cash!!

I hope everyone else is enjoying the weekend!

A Few Points for those Thinking of Borrowing with Prosper

I have the ability to transfer $8,000 from Credit Card #2 to another card. Unfortunately, the balance transfer offer is only for 6 months but it is at a great rate (3.9%). That can work well if I just keep shifting the funds back and forth between cards to keep that balance at a low rate.

The problem is the remaining $11,000 balance on Credit Card #2. That will remain at 13.99% until the entire card is paid off. I am really considering trying Prosper to get a loan. I was thinking I would use the loan to play in the balance transfer game, but now I am just thinking of keeping it there and paying that loan off first (it probably will be the highest interest rate of all debt but less than 13.99%). Part of me is wondering if somehow I could get the loan funded around 7 or 8%.

I've been researching more things about Prosper and found answers to a few of my big questions that I'll share here:

1.) Will applying to be a borrower affect my credit score? Having inquiries on your credit score can lower it by a few points. With my score recently increasing, I would not like it to lower. But I have discovered that the credit report that Prosper pulls on you (to obtain your public credit rating) does not affect your score! It is initiated by you - so it does no damage to your FICO score.

2.) How much does it cost? The answer here is pretty simple. The cost of the loan is just 1% of the balance funded. With requesting $11,000 my fee would be $110. That $110 would be taken from the $11,000 funded so I actually would be getting $10,890 in my account.

3.) Is there a prepayment penalty? If you pay off your loan before the standard three-year term, you will not be penalized. That is a major plus and that point should always be looked into for any loan obtained.

I did end up registering and I was approved right away to list a loan. I'm still looking into finding a group to join, and still reading lots of literature. And, of course, I still I have to make sure that I want to do this. Part of me is wondering if this is the break that I am looking for so I can get rid of the high interest balance on Credit Card #2.

As usual, what it will boil down to is learning as much as I can and then listening to my gut.

I'll keep everyone updated :)

Calling Them Finally Worked!!

I can't believe it! I called credit card #2 and they actually reduced my interest rate! I sit here amazed. I've called them before and they wouldn't budge. Perhaps they are noticing that I am very agressively paying off their card and decided they better do something.

They reduced the interest rate from 16.99% to 13.99% and my account was technically upgraded to a "new" card to get the new interest rate. It's not a huge decrease - but it's something and I won't complain. Every little bit helps when you are in my situation.

Next step - figuring out my gameplan on how to play the balance transfer game so I can get the rates even lower ;)

A Few Updates from the Night Owl

It's past my bedtime, but I thought I'd mention a few things while they are on my mind.

I haven't posted as much as I would have liked to this week. I guess I just have been a little bummed about having to use my credit card to buy groceries.

But I am happy to report that just a few minutes ago I paid the amount back that I spent and I also sent some extra money to another credit card. Total debt as of this moment - $31,429. This time I made sure I left enough "fun" money in the account to stick to the compromise made with my husband ;)

I also wanted to warn everyone that there may be another make-over shortly. Although I like this template, the small width of my posts is making it difficult to post screenshots. I still owe a post about tracking cash in Quicken, but now I am having troubles getting the screen shots to post so you can read them. I am hoping to finalize the new one this weekend.

As always, thanks for your patience and thanks for reading.

New FICO Score Arrived!

This morning I received a dreaded "alert" from my identity protector program, but it ended up being a very good thing.

My new FICO score was ready, and there was an increase from 711 to 732!

They still quote the same negative factors on my score: the high amount of credit being used and the length of my credit history (relatively short in their eyes). But the balances dwindling on the credit cards has helped to raise the score.

My advice to anyone looking to raise their credit score or to keep it fairly high is to not miss any payments. Being current on accounts has definitely helped me. For an article on what late payments can do to your score, check out this article from Credit Bloggers, which I heard about from Mapgirl's Fiscal Challenge.

The Makings of a FICO Score

Even with all of my debt, my FICO score is 711 and that is considered a good score. According to some literature, I should be able to get a loan with no problem but as soon as lenders see my debt to income ratio (52% - the desirable is less than 15%) I think they head for the hills.

How could it be that my score is so high given all of my credit card debt and other debt?

It all boils down to how the FICO score is calculated (as found at myfico.com):

35% - payment history
30% - amounts owed
15% - length of credit history
10% - new credit
10% - types of credit in use

One thing that has always been a top priority is to try to make sure all payments to debt have been paid on time. There are no late payments showing on my credit report. That right there is 35% of my score and I believe it's the best thing I could have done considering my debt situation. Without that, I'm sure my score would be quite low.

One negative that I always seem to have on my FICO score reports is the fact that most of my credit cards were maxed out. That feels good, I can say were maxed out now :)

With the identity protector program I am on, I will be issued a new FICO score late this month. I am actually looking forward to seeing how much it may raise with the lower balances on my credit cards. I say "may" because you never know, I have found my FICO scores to jump all around in the past (from 706 to 726). I will be a little disappointed if it doesn't raise just a little bit.

UPDATE: My new FICO score has arrived :)

Money, Marriage and Compromising

My husband and I get along fairly well, except for one little thing. We often do not communicate clearly with each other. He knows that I am really trying to pay down debt (I take care of all of the finances), but I didn't make it really clear to him how aggressive I was being. And when I say aggressive, I mean that I am often leaving only a few dollars in our checking account. That action is what led to using the credit card this past weekend.

We did get in a little bit of an argument because my husband does not understand how we can be making more money but still be broke. My reasoning is that I'd rather be broke for a little bit longer now and pay as much as possible to the credit cards. Once they are paid off - they will be money for other things. He would like to use some of the money now to have fun and purchase things we could not purchase before.

And that is where compromise comes in. We still haven't finished discussing all of the details, but part of our resolution is that my husband is not going to quit his job at the moment. He is, however, switching his hours so he will have time to work on his business as well as have the same days off as me (which we haven't had in ages). We are also going to use some of his earnings for "fun" things this summer.

Just like most things, a marriage can be a lot of work. But the compromise thing can help a lot ;)

Two Carnivials and a Festival

My favorite time to get some reading in is at the beginning of the week because of the great carnivals and festivals. Here are the ones that I participated in this week:

Carnival of Personal Finance #49 at Frugal for Life.

Carnival of Debt Reduction #36 at Make Love, Not Debt.

Festival of Frugality #24 at Tired but Happy.

And here are the posts that I submitted:

Could Prosper Help Someone Like Me?
What Hit Me Like a Brick Yesterday
Saving Gas and It's Good for Your Too!

Happy Reading!