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<<< can I establish any positive credit in this situation?... I am in debt about 12k to a bank for my student loans. (My father got me into this when I didn't know better.) I don't make a whole lot of dough so if my car needs new brakes, or I need new glasses, etc., the payment sometimes has to wait a week. After a few years of this and several late payments, this bank is rubbing red ink all over my credit rating. I'm doing my best here and I constantly communicate with the bank, letting them know my situation and when the check is in the

1) Don't let this get in the way of your relationship with your father. He's only human.

2) Do whatever it takes to get that payment in on time.
Probably the best way is to get DIRECT DEPOSIT of your paycheck into your bank account and authorize the bank to send the loan payments automatically. When you record your paycheck in your checkbook, record the automatic payment on the next line and subtract it out right away. This way your balance reflects how much is really available. This works great if you get paid monthly. If you get paid every two weeks, subtract out 1/2 payment for every check you enter (in months that you get paid 3 times, transfer the extra 1/2 payment into a savings account).

3) Live on the rest. Make yourself believe that thats all you make. I know, this is the hard part. It might even require sacrifice. A diet of Macaroni & Cheese, hot dogs and lots of frozen veggies supplemented with peanut butter & jelly for lunch isn't so bad. Oatmeal and a cup of tea at home instead of a donut and coffee out(to make up for all the fat in the mac&cheez) will save you about $20/month. Give up smoking ($30+/month). Get a roommate($150+/month).Check out the LIVING BELOW YOUR MEANS message board for more. Heck, maybe you'll even be able to save up a few bucks in a savings account.

4) Banks don't like to hear that the payment has to wait. They don't care what the reason is. Do the above 3 for SIX MONTHS and then call the bank. Tell them that you have mended your evil ways (ie: you set things up so that the payment will automatically be sent on time) and that payments have been made on time for the last 6 months and will be for the rest of the loan term. Tell them that you would like them to remove the red marks on your credit rating (or at least have TRW and the others make a notation on your file that you have been good for the last 6 months and have mended your evil ways.

5) When everyone is happy again (except you because you've been chowing so much mac&cheez that you're turning orange), THEN apply for a credit card.

6) When you get your credit card, make a promise that you will ALWAYS PAY OFF YOUR ENTIRE BALANCE EVERY MONTH. No exceptions!! (Yes, I realize that I'm yelling at this point, but I can't help myself. Paying interest to a credit card company makes my blood boil. It's the ROAD TO RUIN (by the Ramones - you can find it at If you want to buy something and you won't be able to pay it off the same month, wait for it. It's good for you. It's called DELAYED GRATIFICATION and it builds character. (There's not enough of that in this country, but that's another topic).

7) When you're all out of this mess, you'll be a person who is in command of your life and of your wants and desires. Then go and thank your father for indirectly sending you to Financial Boot Camp. Believe me, you'll be well ahead of people who don't learn this lesson until much later in life.

8) While you're going through this, look for things to enjoy every day. There's lots of crap out there, but if you don't let the crap get all over your glasses, you'll see a lot of beauty and have a lot of fun.

9) Remember, you asked for this advice.

Good luck,
Bob B.
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