For those who are judgmental, she is aware she screwed up.
There is so much good advice here already.... I’ll just toss out what I did after I got stuck with all the debit in the divorce (some 30k worth of debit my ex ran up).
I went to a california based company called PBS and they negotiated my debit down anywhere from 50-80 %. Yes there was a fee to pay them.... yes I had to pay what they negotiated.... no it wasn’t easy and it trashed my credit for 3 years. But I am debit free, I own my house and all 3 of my vehicles. I may not be “Phat” but I am much better off than I was. I also wont ever have another credit card as long as I live... I have learned my lesson... sometimes they only way we, as humans, can learn is to be beaten with a stick.
I once got into a bit over my head in credit card debt.
The credit card company kept upping my limit without my permission, until I had a limit of almost 12 grand.
What I did to get it under control was everytime I made a payment, I would phone them up and get them to lower my limit as much as I could, even if I only managed to lower it by a dollar, after payment. I would keep it up until it was cleared.
If I had two or more credit cards, pick one to pay off and make minimal payments on the others. When you have one paid off, take that payment and apply it to another credit card.
Since the interest, as high as it is, isn’t disasterous if you do skip the occasional month, i skipped the occasional month of payments, so I could pay as much as possible on the one credit card, because you always play catch-up.
ping
How good a friend is she, how much do you trust her, and how much money do you have?
IF you have a lot of cash sitting around that is earning essentially nothing, you could loan it to her to pay off her high-interest debt, and have her pay you 5%.
The key to getting out of debt is to replace high-rate debt with low-rate debt, but of course it’s harder to get low-rate debt if you look like a bad risk.
Dave Ramsay’s program has been used successfully by a lot of people to get out of debt, and he has online a list of things to do. Rules like which debts to pay off first, how to cut back on spending, etc.
But in the end, what I have often found is that people without money and access to money find it costs a lot more to live than people who have money and access to money. That’s where friends and family come in — people who personally trust you, and have money, can provide temporary assistance where a cold, impersonal bank won’t.
It’s the simple things sometimes. Like struggling with monthly repair bills for an old car because you can’t buy a better car; in the end, the per-year costs could be much higher for the repair bills, but you can’t get out from under it because you don’t have the money up-front to invest in capital improvements that will lower your monthly expenses.
Things like insulating your home — over 7 years you can pay back the expense, and after that you are living more cheaply; so maybe a parent might “invest” in the upgrade for a child’s home, rather than giving them so big an inheritance when they die.
I’ve got dozens of more radical things to try. For example, if a person has good friends, see if you can move in with them for a month. You don’t get rid of your house or apartment, but you can turn the heat down low, and your monthly expense drops (it doesn’t cost your friends hardly anything more to light and heat their home whether there is another person or not, and eating for 3 is marginally cheaper per person than eating for 2).
If you could find a place to co-habitate for 6 months or more, you might be able to rent out the house,or sublet the apartment, or get out of the apartment lease, saving thousands of dollars.
Eat crappy food for 6 months. Most of us are overweight enough that we could probably stop 3/4ths of our food budgets for 6 months, and come out in better health at the other end, while again saving thousands. But even if you can’t, buying really crappy food won’t kill you for 6 months, and even if you don’t enjoy the taste of the food as much, you won’t die.
Cut your own hair. Buy clothes at thrift stores. Heck, buy most everything at thrift stores (my family does these things, even though I could hire a butler to do my shopping for me — and that’s part of why I COULD hire a butler to do my shopping for me).
Get a 2nd job. I have a cushy engineering job, but last fall I worked at Kings Dominion as a halloween haunt monster. Paid 9 bucks an hour, made about a thousand dollars I didn’t really need — but it was a job, available, and they never seemed to get as many applicants as they were looking for. If I could do that for fun, a person in serious trouble could give up watching TV at night for 6 months and work at McDonalds instead. The extra $5000 or so may not seem like much, but it could be the difference.
Do NOT have her use one of the debt management companies that promise to lower her payment without bankruptcy. While they WILL negotiate with the companies she owes, her credit rating will be destroyed, the management company will take about 20% off the top, and the companies negotiated with will report that debt to the IRS as income. The IRS, in turn, will come after her for more taxes.
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