Reply to What to do first? Debt vs Savings/Retirement

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[quote=Anonymous][quote=Anonymous]Can I get a strategy for getting rid of the expensive car that is underwater WITHOUT it ending up as a repossession on my credit report? [/quote]

Yes. After you have paid off the credit card, save enough to pay off the difference between value and debt on the car and get it refinanced to a lower interest rate if you plan to keep the car. If you absolutely can't do that, then throw as much as you can at that payment until you've paid it off. Whether it makes sense to sell it is a hard call since it depends hugely on what you'd replace it with--is that just a luxury sedan, for instance, or is it a truck or minivan or something where you need a specific type of car? Ideally you'd sell it and buy something used but less costly, but that may or may not make sense. Either way you need to knock that debt down, though.

And I agree with others that in addition to having a plan to pay these off (which should include your DH's credit card consolidation debt too) you really, really need to look at where this debt is coming from. Unemployment can take a big bite out of your finances, for sure, but where is your money going to now? Go through your credit card statements (I use Mint for this and like that) to really understand this. Some of it will probably surprise you.[/quote]

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