Since I was hit with a bombshell of a situation by my wife a couple of days ago I've been reading a lot of things on this site. I've never had any credit problems so sometimes it's like reading Chinese. A quick rundown... My pregnant wife finally came clean that for the last 3 years she has had credit cards & accounts that I knew nothing about. Even though we are both professionals and make a comfortable middle-class living our marriage has been spiraling down for some time and I'd say 90% of our problems can be traced directly to money. Currently, she has about $6K owed on a Wells Fargo Visa & $4K on a Bank of America card. I now have access to these accounts and am blown away by the record of transactions. Anyway... Relationship & trust issues aside (that's another forum, right?), I am considering helping her out of this problem and would like a bit of guidance as to what steps to take. My credit is pristine - last time I checked my score was in the 800's. I don't want to hurt my own credit by putting her debts under my name. I'm certain her credit is pretty shot at this point. She has her credit reports coming to find out for sure. The 2 cards she is battling with she has done okay keeping up with the payments. She has bounced cash back & forth between the two as well as hide money from her salary to help her habits. Both have rates in the 22-25% range, which is killing the balances of course since she makes minimum payments most of the time. There are dozens of late fees on each card but she has seemed to always make a payment even if it's 30 days late. On to my questions - Should I call these companies and try to negotiate a deal to pay them? I have the ability to pay a large chunk of this right out of my account but with the economy like it is and my employer laying people off I'm hesitant to do so because that is my emergency money. What I am trying to avoid is making small payments and getting pounded by the interest rates. I don't know if this is even realistic, but is there any way to get the companies to make a deal with me to agree on paying a portion of the amount owed to them without adding more and more interest on top of it? At this point I don't care about my wife's credit rating. Once this is fixed she will have the job of building it back up. By poking around on this site a bit it almost seems like it's better to actually default on the payments for a period of time so that you can then negotiate a deal. My wife making minimum payments on 22% interest seems like a credit card company's wet dream. Should I stop all payments on these cards and wait to make a deal? As I have time I will be reading other stories and advice on this forum to figure out how to proceed. Any help you feel like giving me would be greatly appreciated and I thank you in advance.
First of all - since the cards that you mentioned are in her name only no credit credit card co. will negotiate with YOU. You don't have any signatory interest in those cards. If you/she stops making at least minimum payments (defaulting) creditors and collection agencies will start hounding her, possibly getting default judgments against her - garnishing her pay, and possibly freezing her/your bank account. I hope your bank account is not a joint one.
Okay, so what are the chances they will negotiate with her? What type of deal should she attempt to get that is realistic at this point, if at all? We do have a joint savings account that I just nearly emptied by moving that money into an account owned only by me.
That really depends how hardnosed/assed the creditors are and how much she owes to each. But these days - of banks begging for bailout mony - I just don't see any banks/creditors giving her much of a deal.
You are putting the cart before the horse here. Late fees don't necessarily translate to 30+ day late marks on her reports. You need to see exactly where she is before you develop a plan of action. Your wife is pregnant, and your marriage is spiraling down, as you indicate - laying out cash right now may not be the wisest choice. So many things to think of.
I think you may be able to speak with the companies because you are the spouse. If not, she can get on the phone and give authorization for you to speak with them. If they are only 30 days or less past due at any given time you probably won't get much of a deal at all. They're loving the 22% at 6K and 4K. If you speak to Bank of America and explain the situation they may suggest you seek the help of a CCCS. From what I remember when I worked there they reduce the IR to 0 on the plan. Wells Fargo I don't know. If you stop paying so that they're farmed out into the industry you'll see the balance increase drastically from late fees, over limit fees and higher IR's. You could then work a deal with those guys if you pay in a lump sum. I would guess the balances would double and they'd offer you at best half off so you're in the same spot now.
If your our not on the card they will not discuss it with you,nor should they just because you call and say i'm the spouse and i want to talk about my wife's problem shouldn't get you in.This is a privacy matter.I tried with one company and went all the way to corp headquarters and still didn't get anywhere.And a company that would give that info out might give it out to anyone.
