I've got caught up in subprime loan mess. I missed mortgage payments and could not keep up with credit cards payments due to increase in mortgage. Almost all of my cc's and my wife's cc's were charged off as of 06/08. I started receiving collection letters and I am trying to find the best way to deal with the mess. I am talking about 10+ CC's and several thousands in debt. Also the credit cards kept charging late fees and over the limit credit fees, so the original amounts double before they charged off the cc's. What would be the best plan of action in dealing with this mess. Should I try to negotiate, lay low, start validation letters, try to settle, etc. Please advise.
Is BK an option? Do you have the funds to settle? The former is almost a better option if possible in many ways.
CC mess Hi, thanks for the reply, I filed BK 2000, discharged 2001 (chapter 7). I read, I believe on kiplinger, that CA buy debts for 2.5 cents on a dollar. If that is the case, I could settle all my debts maybe for 10 cents on a dollar, I don't know, what is your experience in this matter? What, do you think, are my options. Please advise.
You could file chap 13 and have court protection while you pay off there are other way's just wait and see what other member's with more experrience have to say
You might consider credit counseling to pay minimum amount on the cards but each of them will be updated to show that you are in credit counseling on the credit report. Least it does not show as long as chapter 13 bankruptcy it can come off as soon as the account is paid.
I had credit counseling aot of time's they drop the interest rate's very low.However some ca's will not deal with them and use the default rate so you barely pay the interest a tiny bit goe's on the prin.I also had one recommend bk 7.Our troubles were much worse after rent we had 300 dollar's for heat food and med.however thing's are looking up just got my first card at 7.99% will pay for winter oil live in rural idaho had to lower our living standards
You have to really watch them credit counseling companies and make sure that they in fact have a deal with the creditor, you can call the creditor to confirm payment agreement with the credit counseling company. Also make sure on the amount they are charging and the due day. If the credit counseling company pays after due date then ask creditor to move due date so not to be late.
cc mess Thanks for all your replies. The matter with cca is that I don't trust them. I think , I could handle creditors myself, I don't get scare by their tactics. Although, I have a few questions. Are CA's allowed to charge interest?, Should I initiate contact myself or wait as much as I can to start negotiating the debt.? I've read past posts where people advise to dispute everything, but the post are very vague, full of holes. Somebody needs to come up with a strategy to follow on how to deal with these CA's. Like I said in my previous post, I've read in a financial magazine about these CA's and how much they pay for bad debts. I would love to get some insight in what is the best way to settle with these people, you know, a footprint to follow and get rid of all of the bad debts in lieu of removing the collection accounts from my credit report. Now the other question is, what happens with the information that the original creditor reported, is going to be in my CR for 7 years, or Is there a way to get rid of charged off accounts. Thanks every body for your inputs.
I've never had to deal with a CA, so I can't tell you the best tactic. I will say, though, that what they paid for a debt makes no difference in the amount they have a right to collect.
I had a home foreclose on me, I could not pay my credit cards and I ended up moving and getting remarried so I have a different name now. The collection agencies called for months but after my phone got shut off that didn't matter any more. I periodically get letters and a few even got judgments against me. I am now 4 years out of default on these accounts so I have another 3 years of reporting on the original creditor listings and the collection agencies listings. The only thing in my case that made things bearable is the fact that I am now on disability and my income is exempt from garnishment. I am not worried about what accounts showing up on my full credit report that gets shown to companies if purchase exceeds 150,000 insurance exceeds 150,000 and employed for 75,000 or more. I know I won't be seeking money that high for any reason job or purchase. The only problem is the judgments they have a 20 year SOL (Illinois here) and even though they drop off of the report in 7 years they will be kept in public records for 20 years and anyone can look that up. My point is I will wait out SOL on the rest of the accounts then I will come back in and dispute them with the credit reporting agency to try and get them deleted, but if I can't I am just going to let them drop off. I am not actively seeking new credit or services at this time. I don't have car insurance in my name and utilities are for the most part not in my name. If you can't pay, that is likely the course that will happen to you, only difference is if garnishment is allowed in your state then you might have a problem also income tax can be garnished depending on the type of debt. You don't have to worry about a lien against the property since you no longer hold it. You might want to close out your savings account and just pay with money orders what needs to be paid. Cause once you go into collections they are going to try to garnish your savings / checking accounts. You can change your phone number, close your checking account and move that will throw creditors off from finding you if you want to try to lay low and wait out SOL. If you do get a collection letter, you will want to send debt validation request. See if you can stall them, if they verify then you want to try to make payment agreements. Collection agencies don't always follow the payment agreement, if after a period of time they are not satisfied with the progress they will up and sell the account to a new collection agency. There are a few different things that can happen.
That is correct after 7 years it will drop off weather paid or not. But you can always dispute sooner to try and get it deleted.
But just because it's deleted doesn't mean they can't still try to collect. And if you have a judgment against you, they can still take action to levy bank accounts and/or wages, if your state law permits.
