What would you do? Financials and school

Question

Hi everyone. I have about 18k in credit card debt (used to live with my ex, only had a part time job, versus spending for living)
Now I live at home. I now have a full time job, I still don't make enough but I'm trying to pay my debts. I recently decided the best thing for me is to go back to school. I'm going to university in January. I'm hoping my job will keep me as part time, we do have a lot of part time staff however. I was going to get a consumer proposal but I can't get one and also get government school funding. So I had to cancel that. The consumer proposal was going to really help me out but I need and want to go back to school. I have a bad credit score, roughly 630, and I'm going to see if I qualify for some type of loan but I know chances are slim. I also have a vehicle I need to pay off before I lose my hours $3700 left. I can pay it off before then but that doesn't leave me much time to save money for books. I really don't know what to do to pay my minimum payments on my credit cards, I was thinking about calling the credit card companies and saying I'm going back to school can you lower my payments or something to help me and if not expect me to make barley any payments cause I can't afford it. I really don't care right about my credit score taking a dip, I'm gonna be in school for about 5 years so I have time to eventually get it back up. It is what it is and those are my options. I'm meeting with a financial advisor soon to talk about this but I really don't think there is many options for me. 
What would you do to handle it? Am I being stupid? I want to go back to school for a bachelor degree I am going down a path I don't want so I'm doing school for me and my future.

Answer

That’s not how credit works, credit card companies do not care if you go to school and you can’t simply ask for lower payments. Maybe lower interest but that’s it. You need to pay off your credit cards and truthfully things will only get worse if you don’t. Are you wanting a loan to consolidate credit? Or what? How would you pay a loan when you’re already in debt? Perhaps you shouldn’t made a plan to pay off debt for the next year and then go to school.

Answer

I would do 2 things:
-consider consolidating all your loans. Basically, you find a company that will pay off all your current loans (credit card, car, etc.) And then you only have to pay them a certain amount per month. It'll be better for your credit score than skipping minimum payments on credit cards, not to mention you might be able to reduce your interest rate.
-consider working full time and school only part time via night or online classes. It might take an extra year or 2 to complete your degree, but it sounds like you can't afford to go with that little of an income.

Answer

Are you credit cards still active or has the debt went into collections? If I’m collections wait to pay it back, if not most companies will give you a payment plan especially during this pandemic. When I moved I did it for my credit cards and my car payments. They lowered my car payments from 364 to 90 for that time span and my credit cards to $50 a month I was only at 1200 tho, and my car im only owing just over 2k. So I’m not in debt bad but I do have a finance degree as well and collections can lower your credit when you pay them back and usually mean they don’t have the original contract or you ssn so you aren’t obligated to pay them if it’s not the company you signed the agreement with asking for the money. Never pay back collections.

Answer

What are you going for school for? Is there a more entry level position you can take with vocational training? That way you can earn more money before you pursue a bachelors degree? Are you living with parents to cut down expenses?

Answer

Like others have said, that's not how credit card companies operate. They don't care if you can't afford your bills. Personally what I would do is put school on hold, keep your hours, and work to pay down your debt. Good credit is crucial. It plays a large role in adult life so you should absolutely care if it takes a dip. We all make mistakes and that's okay but it's very important to get your debt in order. Too much debt can impact your ability to go back to school. I would go to your local bank or credit union and inquire about a debt consolidation loan or a personal loan to pay off your credit cards. Loans typically have a lower interest rate than credit cards. They also tend to be a bit more forgiving if you need help paying each month. For example, my husbands credit union offers two coupons to *skip a payment* for those who have loans. So if you're struggling one month you bring them the coupon and they allow you to skip that payment. As a banker for a local credit union we offer payment plans on a case by case basis for our members. If you pay down your debt you may qualify for financial aid. I've been in school part time and I receive financial aid no problem. But too much debt and lack of proper payment can limit these companies from wanting to loan to you.

Answer

Are you going to be able to afford a university? I would work on getting your debt paid off before going back instead of racking up more in school.

Answer

I wish credit cards worked like that lol, but yea they wont care about the situation. in all honesty I would say just keep paying your debt, dont let it sit just cause you think your score is already bad, your credit is EVERYTHING. As you get older you will see how important it is. trust me on this

What would you do? Financials and school

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