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Brian Jones*, like a lot of newlyweds, found himself ready to take the plunge and buy a house. But, like a lot of people, the 37-year-old Jones, based in New Jersey, found himself up against a roadblock thanks to his mediocre credit score (certainly not your friend when you are trying to get a mortgage) and the roughly $8,000 in debt he was carrying on two credit cards (one with a 16.99% interest rate).
“It literally felt like a black cloud that was following me everywhere,” Jones told The Money Manual.
He certainly isn’t alone – Americans are up to their eyeballs in debt, and Jones’ level of debt isn’t out of the ordinary. Americans are carrying $1.038 trillion in credit card debt, and the average U.S. household has $8,412 on credit cards.
Still, Jones didn’t want to be just another statistic, so he found himself exploring the options to try and pay down his debts and get his credit score up. That’s when he came across Tally, an app for iOS and Android that helps its users monitor their credit cards in one place, makes credit card payments on their behalf from a line of credit at a lower interest rate than their credit cards so they end up paying down their higher interest debts first.
“I was hesitant to get a new line of credit based on my finances, but a New York Times article on the service really piqued my interest,” he shared. “I knew I needed to do something.”
Per Jones, he ultimately thought he had nothing to lose and decided to give Tally a try. He says the sign-up process was simple, and he just had supply Tally with some basic information about himself and his credit cards.
“Within minutes I was approved for a $4,000 loan,” he says, which he used to pay off some of his higher interest debts. His Tally credit line came with a lower interest rate — 15.4% — versus 16.99% on his higher interest credit card, which might not seem like a big difference, but can translate into saving thousands of dollars over the life of a balance.
Thanks to that credit line from Tally, he was able to cut his credit card debt in half, which had an immediate boost to his credit score, too (one of the ways a person’s credit score is calculated is based on their debt to limit ratio, or, how much debt they are carrying compared to how high their credit limit is).
“Within a month, my credit score jumped ten points,” he said, taking Jones from the high 600s to the low 700s.
From there, Jones used Tally to “start chipping away at my debt” by making payments on his behalf.
Since joining Tally in February of 2018, Jones has reduced his overall debt load to roughly $6,000 (and shrinking). Along with carrying less debt, he’s lowered the interest he’s paying on it. And, he’s seen a dramatic increase in his credit score.
“I’m definitely less stressed,” Jones attested. “Now I’m monitoring my credit score about once a month rather than stressing about it every day.”
He’s also in the process of closing on a house with his wife, and his next big financial goal is to be completely debt free as far as credit cards go in the next year.
“I’m on a really good path,” he said. “I see myself being debt free excluding my mortgage next year.”
*Brian’s last name has been changed in this story to maintain his privacy.
All Photos: Carolyne Loreé Teston For The Money Manual
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