View Full Version : Debt management?
TeeJayHoward
02-15-09, 07:29 PM
While I'm not technically a poolee, I cannot find another forum to post this in. Hopefully, it's the correct area.
I'm 24, and interested in joining the Marine Corps. I spoke with a recruiter and took a practice exam (90%). I've got an associates degree in Computer Networking and a GED. I'd like to be an 0651, but before I can sign on the dotted line, I've got to figure out my finances.
Right now, I've got a decent job. I make a little over 40K a year, and planned out my finances... Well, rather poorly. I can afford my current lifestyle on my current salary, but not on an E-2's salary. I've got two car payments ($600 and $200), which I'm upside down on. I've also got about $350/month in student loans. Between that and insurance on the two vehicles, ($250/month), I'm looking at $1400/month in debt, plus living expenses. An E-2 only makes a little over $1000/month, right?
I don't want to ruin my credit score by letting the vehicles be repo'd, but at the same time, I can't find a way to join up without harming my credit. Time is running out for me to enlist - I understand that anyone beyond 27 isn't considered for a lot of things. Google claims the Marines offer signing bonuses of up to $30,000, but my recruiter wasn't so confident that I could get anything.
Do the Marines offer any sort of debt consolidation plan? Is it possible for me to follow my dream of becoming a Marine without royally screwing myself financially?
boblasek
02-15-09, 07:39 PM
The only thing I was told is that your credit card interest rates can be lowered to 6% and be suspended until you get out of boot camp. I am in a somewhat similar position as you but not to the same extent. Hope someone can answer this for the both of us.
Capital M
02-15-09, 09:25 PM
You could try selling your car before boot.
lthunder
02-15-09, 09:40 PM
Sort that out before you join. Balance your checkbooks and ask questions, lots.
I don't see anything about wife and kids so I'm going to answer as if you don't have either. Sell the $600 car that means you can put $800 a month on the $200 car, and very soon have no car payment. I "think" you can defer your student loans while in boot camp. Go buy the book, TOTAL MONEY MAKEOVER by Dave Ramsey. It'll answer all your questions about getting out of debt.
hempstead56
02-15-09, 10:02 PM
How about going the reserve route? You still get to be a Marine and you can live your lifestyle you want.
TeeJayHoward
02-15-09, 10:32 PM
Sell the $600 car that means you can put $800 a month on the $200 car, and very soon have no car payment.
I would do this in a heartbeat if it weren't for the fact that I'm upside down on the loan. I owe $26K on the car, and it's currently valued at $16K. It's a shame I've got that damned car, too. Without it, my insurance would only be $100/month or so, resulting in a monthly savings of $750 - Enough to let me become a Marine.
I don't have any kids (that I know of!) or a wife.
Student loan deferment may be great during boot camp, but what about when I get out? The $350/month payment starts up again, and I'll not have the income to cover it.
SlingerDun
02-16-09, 12:04 AM
That car is not going to appreciate is it? I've never owned one that after driving it around a couple years exceeded the MSRP. Sell it before it's only worth 15k,14k etc...good time for a trade in on a cheaper or perhaps even used vehicle and unload the second vehicle (if thats what you mean by having two car payments) unless you absolutely need it. Also a good time to haggle rates with everything thats not fixed and if so double check it... credit card, insurance etc...if you cut even close to 100 dollars a month besides the smaller vehicle payments, thats a substantial savings for a new Marine
--->Dave
Artemis
02-16-09, 12:21 AM
You can look into trading in both of your current vehicles for a used car. Doing this you will still have some money from the previous loans that you will need to pay off but that will go on the new loan and the end result will be that it is much cheaper (payments and insurance). Just something to think about.
TeeJayHoward
02-16-09, 12:28 AM
Sadly, no, the car is not going to appreciate. And there's no way to sell a car where you owe more on than the value of the vehicle.
You can look into trading in both of your current vehicles for a used car. I like that idea... I may have to look into it further. 15K upside down on a 5K vehicle would be a $400/month loan instead of $800 combined. Hrm.
I've spent all day looking at this problem, and I think I might have found a solution. I can pay off the truck ($200/month) in 8 months if I pick up a second job, start walking to work (1.5 miles, PT bonus!), cancel my internet, apply my tax return and both "extra" checks, and cut my food intake in half. It'll be a major lifestyle change for me, but it would definitely allow me to prove to myself that I'm serious about the Marines. It'd be a mental bonus while in boot ("I worked my butt off for this. No way am I going to let some DI get under my skin and screw this up!") and also allow me 8 months to memorize the boot camp prep guide (http://www.leatherneck.com/forums/showthread.php?p=310669#post310669) and get in shape.
Something I was wondering about while watching a video on youtube today - How much does altitude affect your running ability? If I do a 10 minute mile at 5,000 feet, does that translate to a 9 minute mile at sea level? Or does it affect it at all?
Also, should I start training my internal clock to wake me at 5:30 instead of 7?
Take em both down to the local dealership and leave the keys in the ignition and a note on the seat that says "YOU CAN HAVE THEM, I'VE JOINED THE MARINES"
0231Marine
02-16-09, 06:49 AM
Have you thought about taking out a loan to pay the difference of your vehicle loan and pay off some of your debt? That way, you'll get out from under your car and you'll have a monthly payment on your loan that you can afford. You can pay a $10,000 loan for about $300 a month over 5 years.
That's if you qualify of course.
thewookie
02-16-09, 08:02 AM
What are you driving for $600 bucks a month?
Doesn't that seem like a stupid decision now? $600 bucks a month for one auto, without considering insurance, what a waste; that's half of my mortgage payment each month and I live on an acre with a private pond. I laugh at some of these car payments that I hear people talk about: worst money decisions that people make, generally revolve around autos that we spend fractions of our life in.
I'm pretty sure the Marine Corps is gonna pull your credit and make sure you honor your debts, and that you can continue to honor them once you're serving our fine Corps.
So, the idea of turning in the keys or getting repoed the "regular" way doesn't seem to brite to me. Or at least I don't think it will help you, it might shut the door entirely.
Because you're upside down, you can't sell the auto's and get someone to finance the unsecured remaining debt, unless you're willing to pay 10-20% interest rate for that now unsecured debt. And since credit has dried up, I doubt anyone, even at ridiculous interest rates, is going to let some guy without any assets to finance over 10k in unsecured debt.
Sounds like you're screwed to me. Go Army, maybe then you can get some slackers bonus and pay for that debt.
Another reason why I have never, and will never, buy a new auto. Even if you buy them one or two years old you can almost always stay ahead of the rapid depreciation (unless you do something really dumb and stretch the payments out for 6 years)
Live and learn.
0231Marine
02-16-09, 08:16 AM
What are you driving for $600 bucks a month?
Doesn't that seem like a stupid decision now? $600 bucks a month for one auto, without considering insurance, what a waste; that's half of my mortgage payment each month and I live on an acre with a private pond. I laugh at some of these car payments that I hear people talk about: worst money decisions that people make, generally revolve around autos that we spend fractions of our life in.
Try $720...LOL!:bunny:
thewookie
02-16-09, 08:26 AM
Thanks Marine, so many numbers my math got fuzzy - $720 a month that's even more gross!
Another point, you're realistically not going to be able to sell that car/truck either, or I doubt it - especially the one that you're down 10k. Cause when you sell it the bank is obligated to release the title to the new owner, the auto and the title go together, so, at that point your debt to them is now/ or would be unsecured, and because of that, I highly doubt they'll release the lien on the title - meaning you can't sell either. Maybe they'll work with you on an unsecured loan but it's not likely, my bank would not, for sure. The only way we would release the lien on the title is if you came to the table with 10k or the difference between the selling price and the note balance.
Got a rich uncle?
I suggest you start reading a Dave Ramsey book.
davblay
02-16-09, 08:44 AM
Try $720...LOL!:bunny:
Please tell me that is not a VW Jetta or Honda Accord!
Dave
SGT7477
02-16-09, 09:48 AM
Take em both down to the local dealership and leave the keys in the ignition and a note on the seat that says "YOU CAN HAVE THEM, I'VE JOINED THE MARINES"
Watch you credit go to hell in a heartbeat.:D
I think it is absolute lunacy to give up a lucrative job and a fancy set of cars for the chance to sleep in a sandy hole and eat MRE's.
If you want to do it don't expect the military to bail you out of debt. There has been some excellant suggestions on how to get yourself financially squared away but don't expect the military to do it for you.
0231Marine
02-16-09, 10:56 AM
Please tell me that is not a VW Jetta or Honda Accord!
Dave
That would have to be one souped up VW or Honda!
My payments are for my Cadillac's.
http://www.leatherneck.com/forums/album.php?albumid=266&pictureid=2011
http://www.leatherneck.com/forums/album.php?albumid=266&pictureid=3650
While I'm not technically a poolee, I cannot find another forum to post this in. Hopefully, it's the correct area.
I'm 24, and interested in joining the Marine Corps. I spoke with a recruiter and took a practice exam (90%). I've got an associates degree in Computer Networking and a GED. I'd like to be an 0651, but before I can sign on the dotted line, I've got to figure out my finances.
Right now, I've got a decent job. I make a little over 40K a year, and planned out my finances... Well, rather poorly. I can afford my current lifestyle on my current salary, but not on an E-2's salary. I've got two car payments ($600 and $200), which I'm upside down on. I've also got about $350/month in student loans. Between that and insurance on the two vehicles, ($250/month), I'm looking at $1400/month in debt, plus living expenses. An E-2 only makes a little over $1000/month, right?
I don't want to ruin my credit score by letting the vehicles be repo'd, but at the same time, I can't find a way to join up without harming my credit. Time is running out for me to enlist - I understand that anyone beyond 27 isn't considered for a lot of things. Google claims the Marines offer signing bonuses of up to $30,000, but my recruiter wasn't so confident that I could get anything.
Do the Marines offer any sort of debt consolidation plan? Is it possible for me to follow my dream of becoming a Marine without royally screwing myself financially?
you can freeze a lot of payments, and i would recommend you call ALL of the people you owe money to and ask them if they would roll the payments onto the end of your payment schedule... most will ask for proof of enlistment and ship dates... they should all accommodate you, though you'll have to do most of the leg work. Anyone not willing to help, you should ask someone you trust to make the payments and give them a limited power of attorney to just make that/those payments. This is your best option in my opinion.
I would do this in a heartbeat if it weren't for the fact that I'm upside down on the loan. I owe $26K on the car, and it's currently valued at $16K. It's a shame I've got that damned car, too. Without it, my insurance would only be $100/month or so, resulting in a monthly savings of $750 - Enough to let me become a Marine.
I don't have any kids (that I know of!) or a wife.
Student loan deferment may be great during boot camp, but what about when I get out? The $350/month payment starts up again, and I'll not have the income to cover it.
dump the car for what you can and get a loan to pay the rest off over a 4 year period... it'll be about 240 dollars a month on 10,000 with your other car as collateral. That will be paid off by the time you reenlist.... or get out. That's the best route I think... and you'll get LCpl quick enough that you shouldn't need to worry about E-2 pay for long... besides if you can have all your payments put to the back of your repayment schedule, you'll have about 3,000 dollars of un-used case after boot camp... that'll lower your 10,000 dollar loan amount and you'd have it paid off in 2 years.
SlingerDun
02-16-09, 03:11 PM
And there's no way to sell a car where you owe more on than the value of the vehiclehttp://www.leatherneck.com/forums/images/icons/icon3.gifSure it happens everyday.... Customer say's to dealer: I have a vehicle (or two) for trade in on one, in return with a lesser monthly payment. This is what i "should" be able to afford $______"should" i join the military. Show me what you got?
On a personal note i think it's a great idea consolidating and reducing that debt as much as possible before enlistinghttp://www.leatherneck.com/forums/images/icons/icon14.gif You damn sure don't want the debters anvil around your broke ass neck accruing penalty interest 1/2 a world away and not much you can do about it, as Sgt. Bulkyker mentioned: Sleeping in a sand hole feeding on MRE's
--->Dave
JoeSzynal
02-16-09, 03:58 PM
TeeJay whatever you decide to do make sure you've got this issue squared away before you enlist. To be perfectly clear you should not enter the Marine Corps with any sort of debt or an idea that the Corps will go out of their way to take care of your debt because they will not. This is how it should be because if they did that would attract more of the wrong type of person.
You've got plenty of time to clear this up. You can enlist on or before your 29th birthday. I enlisted at 28 and got all the same opportunity as everyone else. Height and weight may be restrictions for certain MOS's/Units, but age is not a limiting factor for the most part.
I am on terminal leave now and I EAS on March 6th. Every platoon I have ever been in there was at least two to three Marines struggling with money/debt problems. They loose out on promotions and awards all the time. They also get their reputations tarnished when creditors start hounding the command, calling the company office, calling the 1st Sgt., sending notices etc. It turns into a real mess and sometimes leads to involuntary allotments placed on your paycheck among other things. I've been witness to NJPs caused by Marines being negligent with their debt.
Something to think about. You've heard it before on this board i'm sure. The Marine Corps is not going anywhere. Get your house in order now while it is easier to do so.
Semper Fi.
SlingerDun
02-16-09, 04:03 PM
dump the car for what you can and get a loan to pay the rest off over a 4 year period...Well i see only a couple problems with that: borrowing against debt to pay off debt tends to snowball and is often enough dismissed altogether because there is nothing to show for it (out of sight out of mind) until the collectors attack and legitimate resources are severely damaged then what, borrow again? It's the foremost reason statute on student loans are no longer defaultable, it was so convenient to skip out on them especially if your 125k PHD was in philosphy and you worked for minimum at Pizza Hut.
Debt loans are historicaly proven to work about as good as the stimulus packs that we are and have been in the past told to accept as workable like it or not, its dismal.
Like a second mortgage without a house you will have nothing but payday loan sharks circling your position. Which could happen anyway without a sharp enough pencil and "living within your means" discipline.
If he trades down vehicles he still has payments and insurance but also has something tangeable and of use.
,
--->Dave
TeeJayHoward
02-16-09, 04:27 PM
Some very well written/educated posts on this board. I like it!
I do feel that I should mention, I am not looking for the Marine Corps to bail me out of my debt. I signed that piece of paper saying I would pay, and I feel obligated to stand by that signature. I am trying to, as Cpl JoeSzynal put it, "get my house in order".
Thanks for the advice so far - Keep it coming!
lthunder
02-16-09, 08:06 PM
You're screwed. You're either a Marine or in debt. Take the advice and trade it in the cars or end up living in them with shaving cream all over the windows. You'd get better chow in the Marines from what you are talking about.
You're screwed. You're either a Marine or in debt. Take the advice and trade it in the cars or end up living in them with shaving cream all over the windows. You'd get better chow in the Marines from what you are talking about.
that shaving cream will dissolve.... it'll last maybe 20 min....
PaidinBlood
02-17-09, 01:24 AM
Thanks Marine, so many numbers my math got fuzzy - $720 a month that's even more gross!
Another point, you're realistically not going to be able to sell that car/truck either, or I doubt it - especially the one that you're down 10k. Cause when you sell it the bank is obligated to release the title to the new owner, the auto and the title go together, so, at that point your debt to them is now/ or would be unsecured, and because of that, I highly doubt they'll release the lien on the title - meaning you can't sell either. Maybe they'll work with you on an unsecured loan but it's not likely, my bank would not, for sure. The only way we would release the lien on the title is if you came to the table with 10k or the difference between the selling price and the note balance.
Got a rich uncle?
Uncle Sam, he's hoping....:D
http://backspace.com/notes/images/uncle_sam.jpg
isn't that an anti-war poster?!
who the hell made that! I want his spleen.
PaidinBlood
02-17-09, 01:51 AM
isn't that an anti-war poster?!
who the hell made that! I want his spleen.
Tell you the truth I didn't look at the context from which I ripped it. I just wanted a graphic representation of how broke ol' Sam is. Come to think of it, the caption does cast a seditious tone over it. I'll keep a keen eye out for his spleen as well! (and his gallbladder, if I can manage it...)