If you remember, I was searching for a personal loan to consolidate our debt; four credit cards with high interest rates. Well, a lot has happened since then!
I have ADHD or a severe Type A personality; aka – I have a hard time waiting for something when I want it done now. LOL.
Here is the senerio:
- Listed personal loan request with Lending Club…
- Applied to Credit Union to see if the rates would be any better…
- Found out CU loan would be a 2-yr loan, no origination fee (save $186.50) a bit higher payment of $240, but would save me another $300 in interest over LC and I could get it faster.
Well, if you remember I just recieved a raise. Currently, we pay approx $200 on those 4 credit cards. An extra $40 a month is worth saving another $300 in interest to me. Discussed with husband and accepted CU personal loan (8 hours).
- Mind you… Lending Club fully funded my account in 16 hours with 85 investors!. That is fantastic for my peer-to-peer personal loan!
Originally, I was going to cancel my personal loan with LC upon receiving the CU loan. But I already verified my bank account for transfer of funds. Instead here is what my husband and I did (tis a smart move):
- My husband has a retirement loan that is costing us $441 a month with a total of $3000
- We PIF’d the retirement loan
Why this was a smart move.
Former Set Up:
| 4 Credit Cards | @$200 month | Total: $5000 |
| Retirement Loan | @$441 month | Total: $3000 |
| Total Payments | @$641 month | Total: $8000 |
New Set Up:
| CU Personal Loan | @$240 month | Total: $5000 |
| LU Personal Loan | @$164 month | Total: $5000 |
| Total Payments | @$404 month | Total: $10,000 |
| Still have: | $1,800 sitting in bank |
So now the question remains…
We have $1,600 sitting in our bank. I may do one of two things:
- Save up another $1,100 to pay off my retirement loan of $2,700 or…
- Sit in the bank account and let LC to automatically withdrawl their payments as they will be doing
I could apply this as a partial payment to another card… I am not quite sure. What are your recommendations?
BTW, my experience with Lending Club was wonderful! I was quickly funded $5000 with a low interest rate and reasonable payments. I love that it could all be done online. Plus, their customer service is friendly – was able to answer all my questions with ease. If you compare a personal loan rates with your bank institution, you will realize that Lending Club offers very competitive rates. I highly recommend them. And do plan on becoming an investor when my debt tables are turned from ladened to free. 🙂
WOW! I’m so impressed Lending Club got you 80+ investors in 16 hours!!! Sounds like a truly fantastic medium for those who want to consolidate on lower their debt. As a creditor, perhaps it’s a little iffy, but as a debtor, it’s seems like a no brainer!
18 hours was hella fast! 😉
And my husband and I are quite pleased with the results. I really enjoy that it has cut down on the number of creditors to pay! Makes for easy bookkeeping. 😉
Now onto a New Year and eradicating all the money we owe to companies!
MF – Just checking out your “Finance Spreadsheet”, just so I’m clear, you have $72,000 in Credit Card debt or total debt? Credit job whittling it down regardless. You’re building momentum!
We have on last CC of $7,600 and a HELOC at $18K. Then a car, on retirement loan, student loan(s) and the 2 personal loans. So, it is $72K total debt.
I wonder how possible it would be to live on one income? Hmmm… then the whole shebang could be paid off in little over a year. 😀 ‘ramen’ ‘no cell phone’ no satellite’… I would totally do it. Just wish I could get the rest of the family on the same track!
Ah, gotcha. That’s good the CC debt is pretty small then. Living off one income would be good…. maybe one day, and never again! I’d like to tell my wife to save all her money so we can just live off of mine. Maybe in 5 years when we pay off the rental prop in full, so it can actually provide 100% income.
how much cash will you free up monthly by paying off the next smallest debt?
That’s just it… they are all big debts left (See the debt tab in our finance spreadsheet). I am thinking of just holding onto it until I can pay back the LC loan in full – this way it still give the investors time to get there full return on their investment.
btw, kudos kiddo! the light at the end of the tunnel is getting brighter and brighter.
Thank you! It is getting brighter and I have a feeling 2010 will bring some momentum with it.
I hope you had a wonderful Christmas and have a Happy New Years! I so need to go on a diet the start of the new year!
We are living off one income right now. My salary pays for groceries, utilities, and all the other stuff, and hubby’s income is paying our debt (aside from the mortgage and one credit card — those come out of my salary, too.) A year ago I would have thought it impossible, but using a written budget every month makes it work.
Now that I am thinking about it… I want to see what our ratio is on our salary’s versus the amount of debt we pay. I’d like to figure out how much we would need to cut down in order to live on one salary. Hmmm… New task for me. 🙂
I think that is great that you can live off one income and use the other the debt. And your right a budget is a great tool to keep things on track. I know it can be tiresome, mundane, and repetitive but if you want to reach a great destination then it is all worth it! For me… I luv toying with spreadsheets and numbers.
Great job!
I’m also impressed by Lending Tree’s ability to find so many lenders so quickly. My husband has a personal line of credit with a ridiculous interest rate. It’s pretty much our last “credit” account that we need to pay off. (not counting the car or student loan). Because of your success with them, I’m thinking of giving them a try!
Keep up the great work!
Hi Little House, I really did have a great experience. And I did hear about LC quite a while back, but was skeptical about the whole peer-to-peer issue. But once I talk to Rob from LC, he put my mind to rest. It is completely safe as a borrower.
And I am really going strong on paying this debt down. So to save $700+ interest and cut the live of my debt by 9 months is completely worth it to my husband and I.
It’s really cool that you get to see the loan terms right away when you apply too. Then you can chose if you wish to list those terms or not. So, there is no qualms about what you are signing up for.
I am lucking to have the Credit Union as another source. I’ve taken personal loans from them in the past and I was lucky to get good interest rates.
Let me know how it goes if you two decide to give a try. And thanks.. by all means I plan on keeping up the debt destroying work. 😉
Wow, anytime you can lower the monthly payments, it’s a good thing! Maybe you can take the extra $200 toward the debt and pay it off sooner?
We are now going to one income…at least until I can find another part time position…It will be tough, but I’m hoping that we can get our savings account up….
Looking forward to watching your progress in 2010! You can do it!!!
Sharon
it’s a good thing as long as I don’t rack it back up. Which I am NOT! 🙂
I need to take the $200 to firm up the EF and then I will apply it to our snowball schedule (which I need to clean up and revise).
I am going to look into and see what it will take for us to live on one income and use the other for debt. Essentially, we are almost using one for debt. I need to see what the figures are and work at that. If we can pull it off we can see the debt PIF w/in 2 years. I’m for it!
I wish you luck in finding a good part-time job for you. *fingers crossed* And to meeting you 2010 goals (nice list you posted).
Happy New Year’s Sharon! *clink* Here is to a great New Year!
I am type A too and it KILLS me sometimes. Sometimes I get these ideas in my head about money and moving around and then I have to do it. I need to learn to relax! I’m glad things are working out for you! <3
LOL. I am glad to know someone shares how I feel.
And sometimes when I move things around in a fury… that I eventually move them back to square one again. LOL.
I know many people do not use the Credit Union. So, in that case Lending Club offers fantastic rates compared to a normal bank institution. And even so with the credit union. It’s good to compare. But I am happy with the moves the hubby and I made.
Have a wonderful New Year!
A 16hr funding period is very impressive. I really wish I had known you were up for a loan… would have definitely thrown a few bucks your way!
I have to agree – 16 hours was good. Well thank you, Matt. I can’t believe – 85 investors. And there has been some great support through out this LC adventure – it’s been nice.
So now, I still have $1,800 of it in my bank waiting for a home. What would you do with it?
No problem.
I would keep that $1800 in an emergency fund if you don’t currently have one. I like a 3 month emergency fund at bare minimum.
If you feel you have adequate reserves, then I ask if you have a major purchase you want to make in the next year. If so, then save the $1800 and pay cash.
If nothing is on the horizon and you’ve got a solid emergency fund, then I’d use it to pay down more debt.
I would also say it’s healthy to invest a small portion at Lending Club yourself just to tinker with the P2P investing model. I really enjoy it thus far, but I always wanted to be a banker as a kid.
Wow. Congrats Money Funk. I’m going to have to sit down this weekend and seriously go over our numbers regarding consolidation. I’m not sure I fully trust myself YET not to make the same money mistakes and return to my irresponsible ways. As crazy as it sounds, I’m almost paying the high interest as penance until I’m 100% sure I’m totally serious about sticking to debt reduction.
And I say continue on with paying penance if you are not sure. There are days I think about using those credit cards, but I have been good to be responsible to say “NO”. Plus cutting them up and out of my wallet helps, too. 🙂
As you move further on your journey…you will begin to feel more secure. I do, not completely but getting there. But I am okay not using CCs at all right now!
Let me know how your decision pans out.