Credit Card trouble............?

Question

Got myself in a little over my head with the credit card thing....any suggestions on what to do to get out with out filing for bankruptcy????

Answer 1

PLAYING THE CREDIT GAME
If you live in the U.S., whatever you do, DON'T PAY THESE BILLS OFF WITHOUT FIRST READING WHAT I WROTE BELOW!!!

HOW BILL COLLECTORS WORK
When you have bad debt that goes into collections (after being late/unpaid for 180 days), these debts are sold off to bill collectors (essentially, scum bags run by the mafia). The original bank or creditor is no longer collecting it. Instead, it gets auctioned off to scum bags who buy it for pennies on the dollar. What they do is they turn around and try to scam you for the full value of the original debt PLUS interest and penalties, which can almost double or triple the original balance.

To get these removed from your credit report or to pay it off, you have several options:

DON'T NEGOTIATE WITH TERRORISTS OR SCUM BAGS
Whatever you do, don't negotiate with so called "non-profit" credit counseling agencies! They're in bed with debt collectors, and are run by scum bags and mafia! I'm not kidding. I'm dead serious. They're run by the same people as the debt collectors!!! And they charge ridiculous fees, a certain percentage of your balance. Non-profit my fat buttocks!

TELL THE SCUM BAGS TO SUCK IT!
Send a cease-and-decist letter to the bill collectors, which basically tells them to shove it. This is mentioned in section 805c of the "THE FAIR DEBT COLLECTION PRACTICES ACT".

Here's an excerpt:


----------------- except from FDCACT Section 805c -----------------

"(c) CEASING COMMUNICATION. If a consumer notifies a debt collector in writing that the consumer refuses to pay a debt or that the consumer wishes the debt collector to cease further communication with the consumer, the debt collector shall not communicate further with the consumer with respect to such debt, except --

(1) to advise the consumer that the debt collector's further efforts are being terminated;

(2) to notify the consumer that the debt collector or creditor may invoke specified remedies which are ordinarily invoked by such debt collector or creditor; or

(3) where applicable, to notify the consumer that the debt collector or creditor intends to invoke a specified remedy.

If such notice from the consumer is made by mail, notification shall be complete upon receipt."

----------------- except from FDCACT Section 805c -----------------


By law, the debt collect must return the debt as unpaid/uncollected to the original bank/creditor and destroy your records, or they can take legal procedings against you. They are allowed to contact you in writing ONE LAST TIME to inform you of their actions (ie. if they are suing you, if they're returning the debt to the collector, if they're going to run off and cry to their mommy, etc.). Unless you've got valueable assets, the most they'll do is probably terminate the collection.

If you don't know how to write a cease-and-decist letter, there's plenty of websites that will provide templates for cease-and-decist letters.

NOTE: This does NOT apply to the original creditor, only debt collectors. Legally, you will still owe the original creditor!

REMOVING THE NEGATIVE ENTRIES
After a little over 1 month of sending the cease-and-decist letter, contact each credit bureau where you have these negative entries and request to have these debts verified/validated. The credit bureau will then contact the collector and the collector will be unable to locate your records (per having destroyed your records after the cease-and-decist letter), and the credit bureau will be forced to remove that negative entry.

Once the entry has been removed, contact the original bank/creditor IN WRITING and arrange to make FULL payments in return for a "paid as agreed" entry on your credit report, OR simply removing the account from your credit report altogether. Make sure you get this agreement from them in writing before sending even a dime to them!

THAT'S TOO MUCH WORK, I JUST WANT TO PAY IT OFF
If you don't want to deal with all the steps above, simply contact the creditor/collector IN WRITING and get them to agree to mark the entry as "paid as agreed" or remove the negative entry from your report in return for full or settled payment. Make sure you get this in writing!

I'M A LITTLE BASTARD SHORT AND STOUT...
If you're a little bastard and simple don't want to pay, just wait until the statutes of limitation pass and then you're scott free and they can no longer collect a dime from you. Of course, there's your guilty conscience and the ghost of Christmas past that will haunt you for life!

Also, if you choose to be a bastard and you own any valuable property or have any large amounts of cash stashed in a financial account (such as a house, an expensive car or boat, stock brokers, IRAs, savings, checkings, EXCEPT for 401k's and perhaps 403b's which are protected from creditors), there is a chance the creditor or debt collector could sue you. This really depends on the state where you opened the account.

As for your credit, it takes 7 years from the date the account went into collections to fall off your credit report. Don't make any payments or disputes or requests to verify/validate a debt unless you intend to pay it off! You could easily screw yourself over!!! If you make a partial payment or unsuccessfully dispute or verify/validate a debt, it'll reset the 7 year clock.

For a list of statutes of limitation for debt, check out this website:

http://www.bankrate.com/brm/news/cc/20040116b2.asp

ONE LAST TIP
As an additional tip, by law, debt collectors cannot threaten or harass you. This includes neighbors, friends, family, and empty threats of lawsuits or arrests. If they do, they're violating your fair credit reporting act rights and you can sue the MOFO's for violation of your rights!

To learn more about your rights under the "THE FAIR DEBT COLLECTION PRACTICES ACT", you can either read the FTC's tip page below:

http://www.ftc.gov/bcp/conline/pubs/credit/fdc.htm

Or check out the Wikipedia entry here:

http://en.wikipedia.org/wiki/Fair_Debt_Collection_Practices_Act

If a bastard debt collector is harassing you or violating any of your rights, file a complaint! Be sure to document every phone conversation, snail mail, or harassment you experience.

https://rn.ftc.gov/pls/dod/wsolcq$.startup?Z_ORG_CODE=PU01

CAN ANYONE TESTIFY TO THIS?
In my own personal experience, I owed over $30k in debt that I couldn't pay off due to being laid off during the dot-com bust. The collectors want over $60k after penalties and interest. I laugh in their face. I haven't paid a dime and I sleep very well at night. I only have 2 more years to go before I have a perfectly clean credit, and 1 more year to go before I'm off scott free (I live in Oregon --- the statutes are 6 years). I guess I took the bastardly approach! But whatever. I don't see the difference between being a bastard and filing for bankruptcy; they're both bastardly!!! Just that a bankruptcy will screw you over longer (10 years instead of 7). Doesn't take a genius to figure out which option is easier.

Just an FYI, even with my bad debt, I just bought a new car for 14.9% APR through CitiFinancial. Not bad!

Answer 2

Do you have more than one card, or did you just go spendhappy, nopay on one card?

You could look into credit counseling or debt consolidation. They can help you figure out a relatively low payment that is agreed on by the creditors (something the creditors won't do just with you) and you.

Then, let nothing stop you from keeping that payment schedule. Making those payments on time eventually helps clear your credit report to a point where you can start over, and DON'T get credit cards when you start over.

This is just one big bandaid in a way, but you may could look into getting a personal loan, as long as your credit isn't THAT awful and pay the creditors off individually from that, then make your payments for the loan only. I don't know if that's really possible, though, since you don't say just how bad your credit is.

Answer 3

If you have more than one credit card, figure out who is charging you the most interest, then who is charging you the highest minimum payment. Talk to your credit card provider(s) and see if you can reduce either the interest and/or the minimum payment amount until you are through this immediate situation. Then, target one account to pay off in full. Do not miss ANY payments, ever. Your most important asset in life is good credit. Good luck!!

Answer 4

Yes! A major factor in FICO scoring is what is called your credit "utilization" ratio. That is, the amount of credit you have outstanding vs. your credit limit. Here's why getting close to your limit is bad: When people are not in financial difficulty, they generally pay off their credit cards monthly or leave a small balance. The closer you get to your limit demonstrates that your expenses are exceeding the amount you have the ability to pay off, and so this affects your score. If you charge more than 60% of your available credit limit, this will drop your score slightly. However, charge over 90%, and your score will tumble!

Answer 5

I have 3 articles I think you should read. The first one is about choosing a credit counseling agency, the second and third one will give you valuable information about bankruptcy and the options you might have at your disposal should you not want to go that route>

http://financialbasics.blogspot.com/2006/12/selecting-good-credit-counseling-agency.html

http://financialbasics.blogspot.com/2006/12/understanding-types-of-bankruptcy.html

http://financialbasics.blogspot.com/2006/12/bankruptcy-tips-and-helpful.html

Hope that helps

Answer 6

don't look at the total balance, just take it one minimum payment at a time. they are usually smaller than you think. if you're not sure, then call the # on the back of your card and ask them. or, you could ask for a settlement, it will put an R5 on your credit rating, but it sure beats a bankruptcy. basically all an R5 is is that it shows that you made a settlement.

Answer 7

quit focusing on the interest. focus on paying off the balance. pay off the smallest card and then use the money you used to use to pay that off to pay off the secodn smallest card which has now become the smallest card. when you pay off the balance ont hat, move on to the NOW smallest (third smallest card and work your way up and eventually you'll be working oyur way up to the fish cards. it is going to take a long time but you'll fele a sense of accomplishment and the the interest will go awayafter you pay off the cards becuas its determioned by the balandce. you'll still hav eto pay the interest because thats hoe the card companies make their money though. look at each check you write to the card companies as eing one step closer to financial freedom. use your avialible resources to pay your bills. when youw ant entertainment, try to get it for free if possible. leanr where you cna cut expenses to dru up extra money to pay credit cards off but don't go without food clothes and shelter. (please note this does NOT mean s ashopping spree--it means if you actually NEED a new pair of jeans because you ahve outgrown your jeans and you cna't patch them up go get some! or the washer tore up your shirt, get a n w shirt. THAT is an emergency.) learn to buy clothes on clearance at 70% at thrift stores because 70% is considered a NORMAL price and you cna get an even BETTER deal and the clothes cn be somewhat nice! (Again don't go splurge. use resources wisely.)

Answer 8

You need to make more than the minimum payment, or you will never, ever get your credit cards paid off. And STOP using them. No more. Period. There is no "emergency" worth hanging on to them for. You're just kidding yourself if you say you're just keeping them "just in case." Cut them up and throw them out.

Answer 9

oh hun i feel your pain. im 19 and within the first 8 months of being 18 ive racked up 7500 buckaroons in credit card debt. im trying to slowly pay it off. just never pay the minimum payment. if you just pay that your just paying the interest. try and pay at least double of the minimum payment. AND DONT USE IT UNTIL YOU PAY THE WHOLE THING OFF!
good luck.

Answer 10

Try meeting with a credit counselor. Find one that is recommended by the BBB.

They can frequently get you lower rates and payments.

Answer 11

Look up credit counseling agencies. Good ones will call your creditors and negotiate new rates until pay off. In return, you cut them bad boys up.