Get rid of your credit cards NOW!

[Gumba of Liberty]

Being in debt is one thing. Having credit cards is another. I have about a dozen credit cards with about $200,000 in available credit. I use my credit cards on a regular basis and pay them off completely every month. That is how you use credit cards. If you are foolish enough to carry a balance @ 21% interest, that is your own fault.

So hypothetically, if you had 100K in student loans could you pay off your balance with your credit cards and then file bankruptcy after 6 months?

 

[heavenlyboy34]

Supporting the credit card companies is supporting our enemy!

I may off my balance at the end of every month also hehehe

But I always leave my tips in cash

Not so much if you get a CC from a credit union. Very local stuff.

 

[heavenlyboy34]

So hypothetically, if you had 100K in student loans could you pay off your balance with your credit cards and then file bankruptcy after 6 months?

That would only work if you had a 100k+ limit on your card. Most people probably can't get one of those. (unless they work for the government )

 

[Gumba of Liberty]

That would only work if you had a 100k+ limit on your card. Most people probably can't get one of those. (unless they work for the government )

I fully understand that but would doing such a thing count as some sort of fraud?

 

[Zippyjuan]

I don't think you can use a credit card to pay off a student loan.

Edit- that may depend on the lender. http://collegesavings.about.com/od/studentloanfaqs/f/can-i-pay-student-loan-with-credit-card.htm

If you're in default on a Federal student loan, you can pay your student loan with a credit card. Currently, the Department of Education accepts American Express, Visa, Mastercard, and Discover.

If your loan is from a private lender, they're under no obligation to let you pay your student loan with a credit card. You should check with them on their individual policies.

 

[heavenlyboy34]

I don't think you can use a credit card to pay off a student loan.

No, you cannot. (unless you find a really stupid lender, lol) The statements always tell you who to make the check out to, matter of fact, and usually come with a return envelope.

 

[Noclone]

I don't think you can use a credit card to pay off a student loan.

I'm almost positive you can't. I think you have to use a check card or direct deposit. Most companies still send a monthly bill in the mail. You can write a personal check that way.

 

[dmo069]

So hypothetically, if you had 100K in student loans could you pay off your balance with your credit cards and then file bankruptcy after 6 months?

Yes you could pay your students loans off. I doubt you could get away with declaring bankruptcy under the current laws.

 

[heavenlyboy34]

I fully understand that but would doing such a thing count as some sort of fraud?

You mean spending over the card's limit? It would be fraud, but in my experience the card is no longer accepted when the borrower hits the limit. (unless something's changed in the last 20 years) Usually merchants in this situation tell the prospective customer to come back another time when he can afford it.

 

[heavenlyboy34]

Yes you could pay your students loans off. I doubt you could get away with declaring bankruptcy under the current laws.

If the debt is to the CC company, you could still get away with bankruptcy. If it's to student loan lenders, the law says that such debt can't be discharged in bankruptcy (the lenders lobbied congress for that, btw). This is why student loan agencies can get away with loaning insane amounts of money to kids with no collateral. Any other industry that did this would be called a racket.

 

[dmo069]

If the debt is to the CC company, you could still get away with bankruptcy. If it's to student loan lenders, the law says that such debt can't be discharged in bankruptcy (the lenders lobbied congress for that, btw). This is why student loan agencies can get away with loaning insane amounts of money to kids with no collateral. Any other industry that did this would be called a racket.

That's why I said I doubt you could get away with it.

 

[Gumba of Liberty]

No, you cannot. (unless you find a really stupid lender, lol) The statements always tell you who to make the check out to, matter of fact, and usually come with a return envelope.

You can pay your student loan bills with a credit card. My question was whether you could pay your balance off all at once, attempt to pay your credit card for 6 months and then file bankruptcy.

 

[Zippyjuan]

According to a calculator at Bankrate.com if you put $100k on an 18% credit card the minimum payment would be $2500 a month so if you did that for six months it would be $15,000. They add:

It will take you 571 months to be rid of your debt. In that time, you will pay
$149,422.66 in interest.

http://www.bankrate.com/calculators/managing-debt/minimum-payment-calculator.aspx

 

[heavenlyboy34]

You can pay your student loan bills with a credit card. My question was whether you could pay your balance off all at once, attempt to pay your credit card for 6 months and then file bankruptcy.

Which lender(s) allow that? I've never heard of this. I know some have an "auto deduct" service which deducts the payments automatically from a checking account.

 

[Gumba of Liberty]

Which lender(s) allow that? I've never heard of this. I know some have an "auto deduct" service which deducts the payments automatically from a checking account.

Federal and State of New Jersey (HESAA).

 

[heavenlyboy34]

Federal and State of New Jersey (HESAA).

Damn. Learn something new every day.

 

[Karsten]

I like credit cards. I know a lot of liberty people say "only use cash!" However, at 26 I have excellent credit, and I get 4% cash back on gas, for instance.

 

[RickyJ]

A friend of mine went from nothing to a millionaire by using credit cards. He has unlimited credit now. I guess it just depends on the person.

I bet he he/she has a lot of friends now too. It is amazing what a little money can do to make you popular all of a sudden.