Debt Settlement Questions
Date: Wed, 11/01/2006 - 10:33
There is also another debt, orginally with Chase for around $15000. They have a collection company trying to collect the debt for them and Chase will not talk to us. They have not sold the debt though. The collection company originally contacted my sister with all kinds of threats that they could take her husbands 401k, their house and garnish his wages. She agreed to settle with them for 80% and let them withdraw from her account in a couple of weeks. They were going to get the money from the 401K. I had her talk to a lawyer and the lawyer said they couldn't touch her husband assets since the card was in her name and the only thing the could do was but a lien on the house and told her not to cash out the 401k but to call the collection agency back and try to get a better settlement.
She called them back and told them that she was stopping the withdrawl because she wasn't going to have that much money in there and because they had lied to her about what they could do (which I understand is even illegal). They offerred them 30%. At this time the collection company said that they were only authorized by the card company to accept 80% and that if she stopped the payment that offer was withdrawn and she would owe the full amount again.
Questions I have are:
Hasn't the card company already written the debt off since that collection agency has it and can't the collection company settle for pretty much whatever they want?
Will the collection agency come back and try to negotiate with us? If they don't, what are our other options to get the debt settled?
About your account with the CA, you may take the advice of a deb
About your account with the CA, you may take the advice of a debt counselor because your negotiations with the CA don't seem to arrange anything in your favor. The debt has to be paid, either you pay to Chase or to this collection agency (after you have checked them validating your debt). It sounds that Chase has hired this CA to recover the money. If they can't collect (because of the terms you mentioned), they will report Chase about your delinquent file. You have to avoid getting sued if they start thinking that way.
Talking about your sister's debt with MBNA, I will ask you to think carefully before involving yourself in it. You already have your debts to pay and your sister's debt will be an added liability. Make sure that you don't mess up everything at the end. MBNA is quite tough in working with people's arrangements. Talk to a counselor. He will advice you the best way.
I cannot fully answer all of your questions because I am learnin
I cannot fully answer all of your questions because I am learning as I go by my own experiences and the experience and advice of others on this site. I would suggest registering with this site and taking advantage of the free consultation with a debt counselor, as they will be able to discuss your sister's situation and explain the options available.
I know that some people choose to bypass the collection agency and try to work with the original creditor for a settlement. The main thing is to get everything in writing before sending anyone any money.
Here is a template that you/your sister can use to send to original creditors to try and work out a settlement on your own.
http://www.debtconsolidationcare.com/letters/sample17.html
You may considering having your sister register with the forums.
You may considering having your sister register with the forums. This way she will be contacted by a credit counselor who can discuss her finacial situation.