Author Topic: Helping Someone Who Has Credit Card Debt  (Read 9856 times)

Offline YaakovS

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Helping Someone Who Has Credit Card Debt
« on: June 04, 2013, 11:01:32 PM »
There is someone I know who's paying a ridiculous amount for interest for credit card debt. He's pretty sure he won't get approved for a Chase Slate or any other balance transfer card. Is there any way that I, with excellent credit and a ton of open CL with 0% APR help him out without killing my credit score?

Offline Nitantnel

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Re: Helping Someone Who Has Credit Card Debt
« Reply #1 on: June 04, 2013, 11:05:29 PM »
You wont necessarily kill your credit score, however the chances are that you will not get approved for another card.

In other words, the second you would pay it up, you would be good to go and apply as much as cards as you'd like.

Offline YaakovS

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Re: Helping Someone Who Has Credit Card Debt
« Reply #2 on: June 04, 2013, 11:08:01 PM »
So the only way it would hurt my score by keeping the balance would be because of credit utilization?

Offline bubbles

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Re: Helping Someone Who Has Credit Card Debt
« Reply #3 on: June 04, 2013, 11:08:16 PM »
You might want to think long and hard before accepting responsibility for someone else's debt. (Not my place?)

Offline Nitantnel

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Re: Helping Someone Who Has Credit Card Debt
« Reply #4 on: June 04, 2013, 11:10:49 PM »
You might want to think long and hard before accepting responsibility for someone else's debt. (Not my place?)
+ 1000

I almost never had a good experience when lending money. Literally.

Offline YaakovS

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Re: Helping Someone Who Has Credit Card Debt
« Reply #5 on: June 04, 2013, 11:11:29 PM »
I appreciate the concern, but I have no concern about getting repaid.

Offline Nitantnel

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Re: Helping Someone Who Has Credit Card Debt
« Reply #6 on: June 04, 2013, 11:16:47 PM »
I appreciate the concern, but I have no concern about getting repaid.

Now honestly, why do you not have any concern? Is that because you are sure you would be getting it back, or because you do not care if you don't get it back altogether.

If it's the first reason, consider the fact that you are dealing with a person that has not been able to help himself for his own sake. Why, for your sake, would it be any different?

Unless this person is your spouse, I urge you to consider this. This has nothing to do with goodwill and the intention to repay you.

Offline YaakovS

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Re: Helping Someone Who Has Credit Card Debt
« Reply #7 on: June 04, 2013, 11:32:23 PM »
Not my spouse, but someone who I care enough about that his interests are my interests. In any case, my plan at this point is to open a Slate card, transfer as much CL from my other chase cards as possible. Then, transfer his balance to the slate and have no APR for 15 months. If at the end of the 15 months he still hasn't paid it off, I'll have him open up his own Slate and take the balance back, or just transfer the debt to a different 0% card and pay a balance transfer fee. Sound like a good plan?

Offline Baruch

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Re: Helping Someone Who Has Credit Card Debt
« Reply #8 on: June 04, 2013, 11:40:47 PM »
Just remember if you get charged interest on his loan, it is Ribbis to collect that interest from him (or late fees) according to all Poskim that I ever spoke to about this.

Offline DovtheBear

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Re: Helping Someone Who Has Credit Card Debt
« Reply #9 on: June 04, 2013, 11:42:45 PM »
Just remember if you get charged interest on his loan, it is Ribbis to collect that interest from him (or late fees) according to all Poskim that I ever spoke to about this.
How can that be? You are just passing on charges?
"להסתובב זה לא אומר להיות חופשי"

Offline YaakovS

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Re: Helping Someone Who Has Credit Card Debt
« Reply #10 on: June 04, 2013, 11:47:57 PM »
How can that be? You are just passing on charges?

It's true you are passing it on, but halachically what is happening is there are 2 relationships here. One is between me and the bank, the other is between me and the third party. Money that the bank loans to me, and charges interest on, is on me to pay. However, the third party can't reimburse that money because he only borrow the principle from me.

Offline YaakovS

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Re: Helping Someone Who Has Credit Card Debt
« Reply #11 on: June 04, 2013, 11:50:03 PM »
Just remember if you get charged interest on his loan, it is Ribbis to collect that interest from him (or late fees) according to all Poskim that I ever spoke to about this.

But unless I am missing something, the way I outlined the plan the only interest that'll get charged that I will personally have to eat is a transfer balance fee only if in 15 months it isn't paid in full AND it isn't transferred to a 0% balance transfer card.

Offline Baruch

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Re: Helping Someone Who Has Credit Card Debt
« Reply #12 on: June 04, 2013, 11:50:45 PM »
It's true you are passing it on, but halachically what is happening is there are 2 relationships here. One is between me and the bank, the other is between me and the third party. Money that the bank loans to me, and charges interest on, is on me to pay. However, the third party can't reimburse that money because he only borrow the principle from me.
אין מזרזים אלא למזורזים ;)

Offline Saver2000

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Re: Helping Someone Who Has Credit Card Debt
« Reply #13 on: June 04, 2013, 11:54:29 PM »
It's true you are passing it on, but halachically what is happening is there are 2 relationships here. One is between me and the bank, the other is between me and the third party. Money that the bank loans to me, and charges interest on, is on me to pay. However, the third party can't reimburse that money because he only borrow the principle from me.
+1 

Well said.

Offline YaakovS

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Re: Helping Someone Who Has Credit Card Debt
« Reply #14 on: June 05, 2013, 12:04:41 AM »
אין מזרזים אלא למזורזים ;)

Ribbis may be my strong point but ivrit isn't... And google translate failed on it as well...

Offline Baruch

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Re: Helping Someone Who Has Credit Card Debt
« Reply #15 on: June 05, 2013, 09:45:09 AM »
Ribbis may be my strong point but ivrit isn't... And google translate failed on it as well...
Basically it's a lashon Chazal use to say that you only are mezarez (give mussar to have zerizus?) to a mezuraz (a baal zerizus?). I warned you about Ribbis possibilities - (mezarez), and you knew about the possibilities and the cheshbon behind it (mezuraz).
All though if you read Mesilas Yesharim, Zerizus is for a Mitzvas Aseh, and Zehirus is for a Lo Saaseh, technically it was being Mazhir a Muzhar.

Offline YaakovS

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Re: Helping Someone Who Has Credit Card Debt
« Reply #16 on: June 05, 2013, 12:35:41 PM »
Gotcha. Anyway, anyone got any better ideas?

Offline Am

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Re: Helping Someone Who Has Credit Card Debt
« Reply #17 on: June 05, 2013, 05:09:27 PM »
How about Co sign for him at a Gemach. It's a terrible path to start heading down but so is credit card debt

Offline Barryg

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Re: Helping Someone Who Has Credit Card Debt
« Reply #18 on: June 05, 2013, 05:17:49 PM »
How about Co sign for him at a Gemach. It's a terrible path to start heading down but so is credit card debt
+1
Or, sign him on as an AU to one or two of your cards that have 0 balance when cycle closes and high credit line. The result (hopefully) will be that his utilization goes down to under 40%. He then should be able to apply for a Slate and Freedom in a 2bm and have no interest on his cc debt.
(A combination of Gemach + AU on high limit card is best as it will spead utilization even more).
If he is married this will be a lot easier as only one has to be the holder of cc debt (drop the other from being AU)...

Offline churnbabychurn

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Re: Helping Someone Who Has Credit Card Debt
« Reply #19 on: June 05, 2013, 05:35:01 PM »
I hope you are aware that most banks will not allow a BT from withing their bank. IE.- You cant BT from a Chase CC to a Chase Slate.
This makes the whole BT game tricky.
Good luck