I'm 23 now but I have a $4,000 debt from when I was 18.I racked up charges on a Visa card and had lost my job so I couldn't pay.They kept rasing how much I owed so I just never paid my debt.I got a call from a lawyers office allowing me to pay them or have them sue me.The only type of monthly payment they will take is $350 or more.I can not afford to pay that.My boss told me it might be a scare tactic since my statute of limitations is almost up.Has this ever happened to any one else and do you have any advise for me?
2006-12-21 07:03:30 · 25 answers · asked by katzgto67 2 in Business & Finance ➔ Credit
They won't sue you.
Get together $2000 and offer them a "settlement in full."
Don't give them access to your account and don't do anything until they make the offer in writing.
2006-12-21 07:05:57 · answer #1 · answered by Sir J 7 · 1⤊ 0⤋
More than likely the caller wasn't actually from a lawyer's office at all, but instead with a collection agency hired by Visa. I got a call like that once from a collection agency regarding a debt I had been making monthly payments on.....The guy started off by telling me the lawsuit had already been filed, but backed off when I started asking some very specific questions about the lawsuit.
He finally conceded there was no lawsuit and then started negotiating a settlement amount with me (less than the full amount owed).
Unless you've already been through that process, that's probably where things stand with your situation right now too. Some of these independent collection agencies are downright brutal over the phone and will say just about anything to scare you into agreeing to something.
I very much doubt any attorney would double as a bill collector, so the fact that this person wanted you to make payments directly to him is a pretty good indicator that he wasn't a lawyer.
Believe me, they will take less than $350/month from you if you can set up a regular payment schedule and stick to it. These people are ruthless, but once they see that you're not trying to get out of a debt that you're responsible for, their attitude changes. They're hired to collect -- not incur more expenses by filing a lawsuit over such a relatively small amount.
I know it's scary, but just talk to them....it may take some work on your part, but they WILL eventually listen to you.
Obviously after 5 years this has already had a negative impact on your credit rating, but it will be much more damaging if they charge you off.
Whatever you do -- do not, I repeat DO NOT get involved with any sort of credit counseling business.....you'll end up losing a ton of money to them and your debt will never go down. Also, don't fall for any "big loans with no credit check" scams.
Just talk to the person who calls you and let them know you want to pay your debt, but can't afford 350/month....ask them directly for an alternate plan. I promise -- they'll offer other ideas.
Good luck to you.
2006-12-21 15:37:06 · answer #2 · answered by moonshadow 5 · 0⤊ 0⤋
I have dealt with this problem for an ex and it's really simple. Typically at this point the credit card company no longer has anything to do with the card and they have sold your debt for pennies on the dollar to a collection agency. Call the number on the mailing that you receive, typically a pink or green form letter wanting to collect the debt. You want to ask for a "charge off". This is a reduced amount of what you owe, typically 40-60% of the amount owed. Then once you have settled on an amount you can work out payments that you can afford with the company.
Please note two things: 1)A charge off will still show up on your credit report for the next 7 years. A bankruptcy however will show up for 10 years. 2)The IRS may (I stress may) bill you for the taxes on the difference between what is owed and what is settled. In the eyes of the IRS, the bank "gave" you the difference of what you owed as a gift and this is taxable.
2006-12-21 15:24:14 · answer #3 · answered by Jeffrey H 2 · 0⤊ 0⤋
Scare tactic!
Credit card debt is unsecured debt. You offer no collateral on the debt, so they can't go after any of your assets for repayment. Never, ever go to a credit counselor. They are scams and charge you more fees to do what you can do for yourself. Also, no need for a lawyer. Again, more fees charged for what you can do on your own.
However, they can take you to court and the court may garnish your wages. But that is RARELY done.
You should set up a repayment plan with them. Most company's will settle for 40 cents on the dollar. Offer them $1600 as payment in full. If they accept (be sure you get their acceptance in writing before paying them a dime), this will reflect negatively on your credit rating but at least you will be done with this. However, if you don't have the money to pay off the bill, offer them a repayment plan. Ask for a reduced monthly payment and reduced interest rate. Most company's will accept a 1.5% interest rate from you.
2006-12-21 15:16:06 · answer #4 · answered by kja63 7 · 0⤊ 0⤋
I have two suggestions:
1. The best thing to do is go to a credit counseling service. There are Consumer Credit Counseling agencies in most areas. It is a little bit of work to find a good one, but pick an agent that is a non-profit agency. They'll work with you and your creditors to help you set up a payment schedule and help rebuild and protect your credit. These counseling groups are great and usually work for a donation each month. I highly recommend this!
2. If you want to fight your CC company, get a lawyer. It would be an expensive and uphill battle, and you'd still end up owing it. But it is better than doing it on your own.
There are folks out there who prey on people in financial stress, so be careful!
2006-12-21 15:45:23 · answer #5 · answered by twicewise 3 · 0⤊ 0⤋
Well I assume your credit is already bad because of this particular thing, but what I would have said is to get a personal loan and just pay off the $4,000. Or you could try to get a loan from someone you know and then at least they wouldn't sue you. Other than that I would tell the lawyers the whole situation and see what they think you should do. $350 a month does sound like a scare tactic to me.
2006-12-21 15:07:04 · answer #6 · answered by mojo2093@sbcglobal.net 5 · 0⤊ 1⤋
If you have accumulated too much debt, filing chapter 13 could work and no one that you owe can bother you at all and you would have to pay 1 amount per month for all the companies that you may owe, but like everyone else said consult a lawyer first.
2006-12-21 15:13:13 · answer #7 · answered by .:MS. LADI:. 2 · 0⤊ 0⤋
Don't worry...it's a type of harrasment. They will not lose not time nor money to sue you for $4000. At least not too soon. They will call you and keep asking you to place an amount of money monthly but they will not sue you anytime sooner. In the meantime, you might wanna try some credit repair.
2006-12-22 11:00:07 · answer #8 · answered by lilo 4 · 0⤊ 0⤋
Every one told me even lawyers that the credit card companies can't do anything so I blowed them off for years .Then I came home one day with Levy's on stuff I could not move anything they were going to sell my vehicles for 5k in debt ? So I went and filed chapter 7 and it stopped all calls any the levy .but I also had 70k in medical bills so if I were you I would just try to pay it or go to CCC..
2006-12-21 15:29:12 · answer #9 · answered by ? 2 · 0⤊ 0⤋
It is possible that is a scare tactic.
The best thing to do is contact a lawyer and explain the situation. They can offer the best advice. Plus, if the credit card company does decide to pursue the lawsuit, you will need a lawyer.
Good luck.
2006-12-21 15:08:33 · answer #10 · answered by brnxbombercutie 1 · 0⤊ 1⤋
It wasn't a lawyer! Some credit collection companies use fraudulent techniques to try and scare you. The fact of the matter is that $4000 is not worth them suing over and if they were going to sue they would have done it a long time ago. A charged off account falls off of your credit report after 7 years, they are trying to scare you before it falls off. Charged off accounts are often sold in bulk to individuals who then try to collect from you, I would just ignore it.
2006-12-21 15:10:44 · answer #11 · answered by Jacy 4 · 0⤊ 1⤋