Posts tagged with: debt consolidation

Ashley’s January 2017 Debt Update


First, thanks for all the great comments and advice on my Medical Debt Collector Dilemma post!

If you haven’t read the comments, then I’ll give you the update:  I was able to negotiate our medical bill down into 3 equal sized payments to be paid across the next 3 months (February through April), and then the medical debt will be GONE and nearly $2,000 will be forgiven. Some commenters noted how this will ding our credit, but seeing as we’re unlikely to be needing any new lines of credit anytime soon, I’m not too worried about the ramifications. I feel like we’re pretty well “set” with our current debts (great mortgage rate, good credit card balance transfer options for paying off student loan debt) – we won’t be adding any additional debts, hopefully EVER!

I’m kind of excited about being rid of this medical debt. We prioritized it below everything else so far simply because it was at a 0% interest rate. But with the offer to forgive $2,000 of the debt, it had to be bumped up to the top of our priority list (which will change the “debt payment” proportions that I had just posted in our 2017 budget. Oh well, budgets need to be flexible!).

I know there are strong feelings on both sides of the fence regarding whether it is morally “okay” to negotiate down debts as opposed to paying the bill in full. We would have paid the bill in full. That was always our intention. But we also weren’t in any hurry about it with so much student loan debt racking up in excess of 6% APR. The offer to settle for less than was owed was solely initiated from the medical debt collection agency, itself. So I feel like it was a fair transaction. The medical company will receive their payment (much sooner than they would have otherwise, at that), and we will soon be able to cross off one more debt from our  list of debts!!!

One other thing I wanted to mention was regarding credit card balance transfer options. When I realized I would be unable to refinance my student loans away from Navient with one of the big/respected student loan consolidation companies, some of you recommended continuing to do credit card balance transfers. So I applied for a new credit card and promptly transferred another student loan away from Navient. Again – a super controversial thing in the world of debt repayment. I wouldn’t recommend this option for everyone, but I’ve been doing it a couple years now and have had great success with it. I literally only use the credit card for balance transfers (it’s not even in my wallet – it would otherwise be cut up and destroyed because it serves no purpose otherwise). So now I’ve got TWO credit cards designated specifically for doing balance transfers. The balance transfer fees have been low (between 2-3%) and I receive 0% APR as long as balances are paid in full by the due date (which I closely track and monitor and have never had a problem with). So….it works for us. Unconventional? Yes. Would I recommend it for everyone? No. But it’s working for us.

And so with some explanation of our debts (and, specifically, the new credit card balance transfer debt you’ll see), I present to you January’s Debt Spreadsheet:

PlaceCurrent BalanceAPRLast Payment MadeLast Payment Date Original debt, March 2014
Navient - Federal 2 (unsubsidized)$110985.8042January82433 (all school loans, combined)
Navient - Federal 3 (subsidized)$86245.8025January
Navient - 2 (subsidized)$85316.5525January
Navient - 7 (subsidized)$72266.5521January
Navient - 8 (subsidized)$63986.5519January
Navient - 9 (subsidized)$85316.5525January
Navient - 10 (unsubsidized)$97726.552018January
Balance Transfer Student Loan #2$22000% (through April 2017)$800January$7650
Balance Transfer Student Loan #3$45940% (through October 2018)
Medical Bills$55860% (must be paid by April)$25January$9000
Balance Transfer student loan #1$00% -Paid off in March 2016$5937
PenFed Car Loan$02.49%-Paid off in January 2016$24040
License Fees$02.5%-Paid off in April 2015$5808
BoA CC$07.24%-Paid off in June 2014$2220
Mattress Firm$00%-Paid off in May 2014$1381
Wells Fargo CC$013.65%-Paid off in May 2014$7697
Capital One CC$017.9%-Paid off in March 2014$413
Totals$72,560 (Dec balance = 75,171)$3000Starting Debt = $145,472

When I first started blogging back in April 2014, I had $145,472 total debt.

As of January 31, 2017, with a margin of under $200, we have finally hit our half-way mark! We now have $72,560 in debt.

Oh my gosh, guys! I can’t tell you what a huge milestone this is for us! I’ve been blogging for nearly 3 years and we have JUST NOW hit our half-way mark in terms of debt reduction. We likely have another 2.5 years to go (maybe less), so we’re over half-way in terms of the time spent in debt reduction mode. I just cannot even believe it. All the changes in the past three years, all the sacrifices, all the splurges, all the savings and the spending and the analyzing numbers over and over and over again. It just feels fantastic.

I know some have commented that the second half of debt reduction would just fly by. That as soon as we hit the half-way “tipping point” things would start snowballing and debt would just melt away.

I’ve got so far still to go, but I am hopeful and excited about the future!

And I want the debt gone sooner than our projections have it. I want it gone yesterday. I’ve been doing a lot of thinking of ways to reduce savings categories (temporarily) in order to throw more toward the debt. And there’s still some work stuff up in the air that will impact this whole process. I’m optimistic. It’s hard not to be. I may not be able to quite see the light at the end of the tunnel yet, but at least we’ve crested the top of the mountain and are about to make our descent. I can’t wait for the journey downward!

Consolidation Station???


The title of this post has nothing to do with anything, except it reminded me of the lyrics “conjunction junction, what’s your function” (from the School House Rock theme song).

This is a quickie post, but something that may solve some of the high student loan APR issues that I’ve been talking about recently (see discussion here, see list of debts and APRs here).

Any readers consolidate their student loans?

Have good experiences? Bad experiences? What are your thoughts??

I’ve heard that you can only consolidate a single time, but that would be okay with me. My credit has vastly improved across the last year as I’ve paid down my debts so I think I’d qualify for a lower APR. I don’t know the ins-and-outs. Would this impact my income-based repayment? Can I consolidate through the same company I already have or do I have to use some outside company? How does all this work???

For the record, IF (big if) this happens, I would absolutely 100% only do this in order to lower my APRs. I would not start spending money elsewhere or think this means I can pay less toward my student loans. It’s strictly an interest rate thing.

Thoughts? Experiences? Advice?

I assume I’d need to start by calling and speaking to a representative at one of my loan companies (I have two companies:  Navient and ACS). Before I even take that next step I’d just like to poll the audience (YOU!!) and get your opinions on the matter.

Thanks in advance!!!

Advice Wanted!


I’ve been doing a lot of thinking about our debt payoff journey and feel as though I’ve come to a bit of a crossroads. Sometimes having an objective opinion (YOURS!) is just what it takes for me to gain a little perspective or see something from another angle, so here’s the deal….

I’ve been (borderline-obsessively) checking and re-checking my budget/debt spreadsheet, trying to determine the best course of action. It appears that we will be able to pay off the Wells Fargo card much sooner than previously expected (probably by June!!!), and the plan has ALWAYS been to snowball that payment toward our last credit card – Bank of America.

But a careful examination of ALL (of our many, many) debts leaves me feeling a bit unsettled about the decision. I think the money may be better allocated toward a different debt.

To get a big picture, I’m going to break from the mold a little and lay out my debts now (mid-month) instead of waiting until the beginning of June. So here’s the big debt picture (listed by APR – highest to lowest). Note the “Deferment Ends” column. I have listed minimum payments for my student loans once deferment ends.

PlaceCurrent BalanceAPRMinimum DueMin Due (When Deferment Ends)Deferment End Date
Wells Fargo CC$334513.65%8787N/A
Sallie Mae - Dept of Ed$55788.5%0692/10/15
Sallie Mae - Federal Student Loans$45648.25%6262Current (no deferment)
BoA CC$21407.24%3535N/A
ACS Student Loans$213887.24%2524010/28/14
Sallie Mae - Dept of Ed$652367%07372/10/15
License Fees$56232.7%5555N/A
Medical Bills$82530%100100*Still does not include Mayo Clinic bill


My thoughts are totally fragmented, so I’ll lay them out bullet-style.

  • I recently discovered that one of my Sallie Mae Department of Education loans is at an 8.5% APR….ALL of the others are at 7% so I had mistakenly thought this one was 7% too, and had previously lumped them all together. I’ve now separated this debt because it will be my highest interest-rate debt after WF is paid.
  • When deferment ends my plan has been to consolidate my student loans and try to get a lower interest rate. So its possible the 8.5% could be getting a reduction in February.
  • After my Wells Fargo card is paid in full, my plan is to go try to refinance my car loan for a lower APR (currently 7.24%). So its possible I can get this interest rate lowered.
  • People may disagree with this one (particularly as my #1 goal has ALWAYS been to eradicate CC debt), but now I’m feeling less urgency about getting rid of my BoA debt. I feel the money might be better spent going toward a higher interest student loan??? Additionally – any credit gurus out there? I’ve read that if you have $0 CC debt it can actually ding your credit score a little (not as significantly as having too much debt-to-credit, but there’s still an impact). Being as I’m trying to refinance student loans and cars, I’m thinking that leaving a little debt on my lowest APR card right now might not be terrible? (Note: I’m NOT suggesting I stay in debt forever….just saying I may be better served to allocate funds toward higher APR debt currently while I’m playing the credit score game).
  • My ACS student loan deferment ends in October, at which time the payment will increase to $240/month.
  • I’m mathematically-minded so my preference in debt-repayment is highest APR first (regardless of balance).
  • That said, if I were to rank-order my debts in order of the PERSONAL satisfaction I’d receive from paying them off (that whole psychological aspect component), I’d rank: Wells Fargo, Bank of America, Carmax, License, Student loans, medical debt).
  • My current inclination (a rough combination of mathematical and personal satisfaction factors) is to rank order debt repayment as such: Wells Fargo, Sallie Mae (first the 8.5% APR, then the 8.25% APR loan), Bank of America, license, Carmax, remaining student loans (ACS & Sallie Mae 7% APR), and medical debt still dead last.
  • At the same time, I’m trying to think of some strategy to leverage the extra money we have right now. While student loans are still in deferment I have a good amount of extra money to throw toward debts. Once deferment ends my funds will be greatly divided. I’d like to strategize to eradicate some of the lower-amount debts so that – once deferment ends – my funds aren’t being split into 15 different directions!
  • Ever heard of using a 0% APR credit card to pay student loans??? Remember that 0% offer I got that everyone said I should take? I never did (and won’t need it since I’m kicking WF’s butt right now!), but maybe I could use it for the 8.25-8.5% APR student loan debt??? Yay? Nay?
  • Keep in mind we’ve only budgeted $1500/month for debt repayment, though we’ve been putting extra toward debt each month if we have money available after paying our bills.
  • Another couple considerations to throw into the mix just for fun…at some point (before all of our debt is gone), we’re going to have to cash-flow some major expenses: serious dental work for my husband (discussed earlier today), and a new work truck for my husband (if we’re lucky, maybe it will last until next winter….we already had several problems this past winter). Plus all the “baby” related items as our girls grow older – buying the supplies to convert cribs into beds, newer carseats when they outgrow the old ones, etc.

I’ve liked not splitting priorities, so I can focus on eradicating one debt at a time, but I won’t have that luxury much longer, as the minimum amounts due on many of the currently-deferred student loans are going to be increasing within the next 1-8 months and forcing me to split up our finds.

Your thoughts, recommendations, incite?