get out of debt

...will be done within a month! Sooo close!

We always put in more than the minimum payment to our cards, but we also keep buying stuff! Overall I think we’re doing very well though. If all goes as planned with our budget, at the end of this month we’ll have Capital One paid off once again and owe about $1,000 to Best Buy. (We’ve purchased a new monitor and a couple of hard drives on that card lately.) We’ll also owe about $1500 to my parents. We haven’t made a payment to them in a few months but they say they want us to pay off our cards first.

Capital One is once again paid off, and we owe about $900 to Best Buy. Still making good progress. We’re getting a tax refund that we’ll apply to Best Buy, which will speed up the process. =) Almost there!

We bought another new computer, a media server, on our Best Buy credit. Truthfully, I’m not too concerned about it. We bought my laptop in May of last year (at which time my desktop computer became a file server), paid it off, bought my husband’s new laptop, paid that off, now we bought the media server, and we’ll pay that off… and I can’t imagine any other computers we need to buy after that!

Our new computer is pretty sweet in my opinion. You can check it out here. It’s got 2 gigs of ram, a dual core AMD processor, and 320 gig hard drive. (My husband and our friend Mike are in the office right now installing a 500 gig secondary hard drive.)

All it needs now is a bluetooth remote and tv capture cards. We were going to buy them at Best Buy, but the one that we knew for sure would be supported by the software we want to use wasn’t in stock at the store (we had found it on the Best Buy website). It’ll be like Tivo, but better!

The computer, 2-year extended warranty, bluetooth dongle, and the 500 gig drive, came out to about $1,000. We plan to spend another $300 on tv capture cards, and I haven’t researched remotes yet. The plan is to have it all paid off by September. Wish us luck. =)

Our payoff of our Capital One card has posted to Capital One but not to our bank yet. (We pay online, it’s great.)

With my husband’s check next week, we should be able to pay off the rest of our Best Buy card.

So by this time next week, our only debt will be:

Car loan, about $10,000, give or take a few thousand =P (I consider this a cost of living expense, I’ll consider myself out of debt if I just have this payment left)
Parents, about $1,700 (this is a seperate goal)

That’s it! Woohoo!

We paid off the medical bill from when we were un-insured (total of about $750). We paid off the credit card but charged it back up during a vacation. The store card (Best Buy) we haven’t used in a while, so that balance is continually going down. Debt to parents has gone up, they lent us money for our new bed. Totally worth it!

Medical: $0
Best Buy: $866.80 (planning to pay this off completely this month, may take two months depending on how much OT my husband does and how much we eat out)
Capital One: $444.99 (paying $200 this week and the rest on the last check of the month)
Parents: $~1700 (planning to give parents $200 before they leave to Mexico on the 15th)

Right now we’re trying to stick to a budget so that we can be really aggressive on debt repayment. Once it’s all paid off, we’ll treat ourselves a little more, and save a lot more, like signing up for the 401(k) at his work. We’d like to buy a Wii and some sort of media server (possibly convert an Xbox). That’ll be nice treats for us when we’re done.

Until then, we’re planning to go to Disneyland most every weekend, because it’s “free!” (By “free,” I mean we do have to pay for gas and food, but parking and admission are free.) Great way to keep ourselves busy, get some light exercise (the internet calculated for me that we walked about 1.8 miles inside Disneyland last Saturday), and keep from shopping!

My husband’s check was direct deposited last night. It was more than we had expected it to be, I guess he did more overtime than I thought!

I’ve made a payment to our credit card and the store card. I may go to my parents’ over the weekend and give them the remainder of what we’re paying them this month. I will call the medical people today or tomorrow (most likely tomorrow because my husband and I are supposed to go to dinner today).

And I put $250 more than planned into savings. =)

We’re switching from payday every 1st and 15th to every Thursday, so the rest of the overtime is going to remain in the checking account for next month’s rent. Income and expenses will be the same, but our baseline has to go up so we’re carrying over more into the next month.

I’m so so very tempted to use all of the overtime toward debt, but we’re only a month away from paying it off completely anyway, and I want to make sure we go through the adjusting pay without getting thrown off too much.

We’re continuing our very aggressive push to get out of debt. The plan for the rest of this month (this is all balancing out perfectly in my budget spreadsheet!) is as follows:

Medical bill – We have $200 due on the 18th, and then 182.60 as the final payment next month. I’m planning to pay the whole amount, getting this bill off our plate a month early and giving me an extra $200 to work with next month.

Capital One – We owe $300 on this. I plan to pay it off entirely. We seem to do that every month or two. =) This card gets used for “it’s not in the budget but I need/want this now” stuff so that it doesn’t throw off the budget. (An extra tank of gas, date night, replace broken items, etc.) It typically goes no more than a couple hundred dollars then we pay it off, it works for us.

Best Buy – We owe $1066.80 here. Our minimum payment is $10, but it needs to be paid in full by 5/23/07 to avoid accrued interest charges on a 6-month same-as-cash purchase. I plan to pay $200 to this in February, leaving $866.80.

I also purchased something for $130 for my cousin this month. My mom’s taking it to Mexico with her in the next month or so, where my aunt will pay her for it. So mom’s applying the $130 as payment toward what we owe them. I plan to give her $120 more by the end of the month to make a nice round $250.

Then finally, there’s $500 going into savings this month. Saving and getting out of debt go hand in hand, but we’ve been much more aggressive in debt repayment than in savings. Our credit cards charge more interest than our bank pays, so we focused in that area first. (We use savings for one time expenses such as conferences and travel.)

In March, I can hypothetically pay Best Buy $200 (same as this month) + $300 (what I’m paying to Capital One this month) + $200 (our normal monthly payment on the medical bill), + $250 (what I’m paying my parents this month), which is $950. That’s more than what we’d owe! :D

End of March, that’s my goal, then the only debt we’ll have will be parents and car payment. Then we can get really serious about saving! (If we’re putting $950 to toward debt and $500 to savings, that’s nearly $1500 to savings starting in April!)

I’m quite pleased. :D

I got my credit report from Experian today (I got Equifax in July).

Changes since July:

My married name now appears along with my maiden name.
My address I was living at in July now appears, along with my current address. (In addition to the ones that already appeared.)
The car debt is down from ~12k to ~10k.
All “pays as agreed” payments since July. =)
There are fewer publicly viewed inquiries now than in July.
There are more private inquiries (that creditors don’t see) now than in July. That must be why I keep getting more credit card offers than ever before.

Credit score: 672. “Non-prime.” Higher than 33.22% of U.S. consumers.

Could be worse. =) It seems like all of the things that are holding me back here are time-related or the fault of Capital One (who reports my credit limit as $0, skewing my debt to credit ratios). I’ve only credit since about 2.5 years ago and the car loan for about 1.5 years. It seems like if I just keep doing what I’m doing, this will go up pretty easily.

Things to do to increase score, according to Experian:

1. The available credit across your open credit card accounts is too low. Having low available credit amounts on credit card accounts has a negative impact on your credit score.
   As mentioned above, this isn’t as bad as it looks on my credit report. My available credit is mis-represented because Capital One says I have x charged on a card with $0 credit limit. This is apparently a known issue with Capital One. Anyhow, revolving credit balance is being reduced pretty aggressively.
2. Your report shows that the ratio of balances-to-credit-limits across your open revolving accounts, such as a credit card, is too high. Having a high proportion of balances to credit limits on revolving accounts has a negative impact on your credit score.
   Same as above.
3. Your report shows you have too few credit accounts paid on time in recent months. Recent late payments have a negative impact on your credit score.
   I have one 30-day late payment in October of 2005. It’s no excuse, I know, but I had just gotten married and moved to another county, and had no internet access for a good 2 months. I didn’t get the bill, couldn’t check it online, and didn’t think to call them in the flurry of activity and things to do. The only way to improve this point is to wait it out, I haven’t had any other late payments at all on any account.
4. Your report shows that the time since your oldest credit account or loan was opened is too short. Having credit accounts or loans open for a longer period of time has a positive impact on your credit score.
   Another thing I have to wait out.
5. Your report shows one or more inquiries on file. Each time a potential lender pulls your credit report for review, an inquiry is placed on your file. While having inquiries on file does affect your score, the impact is minimal.
   The only public inquiries at this time are the Ford dealership we bought the car at and Ford Credit, both in May of 2005. I guess I have to wait this out too.

Next order of business after reducing debt is to work on establishing a credit history for my husband, possibly financing some furniture in his name, or our next car. Something like that. I was advised that to buy a home it’s better for each of us to individually have good credit than to try to combine his history and mine. I’ve got “non-prime” credit and he doesn’t exist. We have time though. =)

We’re paying $1,000 toward our debt again this month, not counting car payment. It’s been determined that the first check of each month is for rent and the second for debt repayment, so far as the major portion of the check that is.

This month:
$500 to Capital One, paying it off again (after we charged $500 to it to fix our car, in addition to tapping out our savings)
$200 to medical expenses from when we were un-insured
$100 to Best Buy
$200 is stashed in our savings account until the end of the month in case of emergency, but when we get my husband’s February 1st paycheck, that’ll go toward Best Buy (unless of course there’s some emergency between now and then)

At this rate, we’ll be out of our non-car, non-parent debt by the end of March.