I have $20K debt on a 9 year old visa card upped from 13% to 27% cuz I was just one day late making minimums about 3 months ago. Never been late before, and my FICO is around 720s. I lost my job 5 months ago too, and hate that what's left of my nest egg is partially going to credit card instead of me and my family. So I moved overseas to my wife's family to relieve financial pressure since they're helping us out for now. I'm trying to find a job here locally till I can fully support my family again, but this credit card is dragging me down. Is it smart just to write a letter to my credit card company asking for some kind of negotiated settlement as payment in full and close the account? If so, when is the right time to do that? Advice?
Are you still an American citizen, or did you change citizenship? If you're no longer an American citizen, as I understand it, the OC / CA has nothing to go on. Failing that, I assume the statute of limitations for court action is tolled until your return. Meaning, if your home state has a five-year SOL and you leave at the end of the first year, then they have four years starting from the day you return in which to file suit. I may be completely wrong. This is an interesting one, though. I'd love to see some of the more experienced members weigh in on this.
I am a US citizen and will continue paying my taxes from abroad. At 27% on a $20K balance, that is almost $500 in finance charges every month. Some may judge me about ditching my obligations to the balance, but I need that $500 to help my wife and kids now. The bank has already made $$$ of interest off me over the past 9 years as a never-been-late customer, so I don't feel that bad. I'm willing to pay up to $4000 to the bank to settle and close the account now. If they don't bite, then I guess plan B is to run out the clock (if indeed that is true in my case as you pointed out) with the hope that they don't sue and with the sadness that my good credit will be damaged. Oct 19 is my next min payment that I will miss for the first time.
If you're going to such lengths to avoid it, why not just declare bankruptcy and be done with it legally?
Sigh... i'm not well versed in bankruptcy, but i have this perception that it takes a lot more time and effort (and possibly lawyer fees) than just simply ignoring the credit card bill. And my understanding is that bankruptcy does more damage to my credit score than being delinquent on one credit card. For example, if a prospective employer were to check my credit, then I'd rather have one blemish than a complete disaster. Not sure if that makes sense, but my gut says to keep cash with the family and try my best some way to work out this debt.
If you have $4000 in the bank and can settle,then try to settle.However you can file bk for under 2,000.Yes you'll have a bk on your records.Millions of us will before this is over.The creditors are on for seven years from first missed payment.The bk is on for 10 years.Over time the impact of the bk will lessen.Remember if they get a judgement it stays for 10 years or longer,if it can be renewed in the state you lived in.So if and when you come back they can still try to collect.Leaving the country wouldn't make this go away.The creditors are like elephants with long memories.Remember at this time your family comes first.
