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Help. I am trying to settle my credit card debts without the help of a company. I owe discover card 11k. I did a balance transfer of 11k to them in 2006. So they say I am not eligible for settlement. Is this true? They say that they are ready to charge off my account, it has been near 120 days I think. They say they will then send my account to an attorney and he would probably go after our property. They offered a payment program with reduced interest. What should I do?

Posted: Thu Sep 18, 2008 8:04 am Subject:

I'm not an attorney but unless it's secured debt, I don't think they can go after your property. They can sue you and get a judgement and garnishment. I would probably have to take the payment program with a reduced interest.

ok, thanks for your advise, I appreciate it. Anyone else know about Discovers practices on Settlement? Thanks.

Posted: Thu Sep 18, 2008 9:11 am Subject:

In general a balance transfer has nothing to do with settlement. They might have some company policy but there certainly is no law about it. They charge off at 180 days by law. At that point they will probably send it to a collector that will hound you for months or maybe years and eventually somebody might sue.

I would at least consider their repayment offer before you default. They are offering you a hardship program which generally reduces the interest rate for a year or so. I don't know what they offered but I would push for a really low rate like under 9% and I would also make them remove all fees and penalties to date since they are junk fees. If they are not willing to do that or if you have no money then you will probably be forced to default. Once you default or maybe even before you default they will probably be willing to settle at a percentage of the amount owed.

Posted: Thu Sep 18, 2008 9:32 am Subject:

Most creditors I don't think will settle before an account gets charged off. Because while it is open, it is sitting as an asset on their books and they have to account for it on their balance sheets to the shareholders. If they settle before their policy deems it to be bad debt, the shareholders see them as "giving the house away" (or an otherwise unjustifed loss). Funny how time changes things... after 120 days then they deem it as bad debt and will charge it off. Their policy may let them settle then, or they can still refuse and sue for full balance.

On small balances (say $1000-3000) they won't put a lot of collection into it and rather just sell the account off. However on large balances, in your case $11k, they usually will send it to their attorney for a lawsuit.

A judgment can act as a lien against any property you own, depending on state law. If you own a home, they can register their judgment with the county recorder and then you cannot sell the house until the judgment is paid. Or suppose you have a car that's paid for; they can motion to attach that car (or any other assets they find) to the judgment and a judge can order a seizure for the benefit of the creditor. I think that is more or less what they were alluding to when they said their attorney would go after your property.

If they are offering you a payment plan with reduced interest, I would take it. Doing a civil court search on Discover, they do sue a lot of people, so I don't think they're bluffing.

Thank you all for your help. I live in Colorado, I don't know if that changes anything. I was hoping to settle on all my credit card debts because we have so many. What would a debt settlement company have done if I wasnt doing this on my own? Would they have been able to reach any better deal with discover card? Discover did offer one year of reduced payments and 9.9% interest.

Guest · Posted: Thu Sep 18, 2008 5:40 pm Subject:

"Or suppose you have a car that's paid for; they can motion to attach that car (or any other assets they find) to the judgment and a judge can order a seizure for the benefit of the creditor."

If you sold that car to a family member before they sued you, can the CC company still go after it? For example, if you have a car that's paid for worth $5K, can you sell it for $5K to a family member. Then use the proceeds to pay rent, bills, etc. (before they sue). Can they still go after the car?

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