Do I talk to the debt collectors?

I think you should try and work something out with your creditor before they are sent to outside agencies because that is a different ball game that you definitly want to avoid if you can.

Also a creditor doesn't need to use scare tactics. Generally what they say comes to pass. They are either going to sue you or send it to an outside collection agency and not necessarily in that order if your balances are worth the effort of sueing you.

By the time your credit cards go to an outside agency the balance is due per the contract you signed with them when you took posession of the card and swiped it that first time.

Please take FYI's advice as she has knowledge on this subject. It won't do any good to just ignore them because they won't go away and it might make everything worse for you in the end.

ladybug

I'm with FYI you need to speak with them before a CA gets them. Since you are behind now, they may even let you get on their hardship programs and drop or lower the interes if you agree to pay them monthly.

A couple of cards had done that for me in the past when I told them I wanted to pay them off, but couldn't because the balance kept getting higher because of the interest. This helped me to pay off our credit cards.

The don't go away, and CA aren't as nice sometimes as the OC. I have found that if you truly seem to want to pay your bill, but can't, alot of them will work with you..Good Luck..Karen :D

You might be surprised what you can work out with the original creditor. Generally when you show a willingness to pay and explain what might be hampering your ability to pay, they may be able to work with you. If they know you want to pay it off but you just have certain limitations they will generally try to work with you to get some kind of payment plan worked out (within reason of course)

Here's the bottom line: Things are already strained between you and the OC. If you talk to them, what's the worst that they can do?

On the other hand... If you don't talk to them, you know things are gonna get worse.

Keep these out of collections. That is a mess you want to avoid.

Tell them your situation and see if they'll set up a repayment plan that you can afford. A lot of times they'll waive overlimit fees, and late fees. Sometimes even freezing the account so it doesn't accumulate more interest so that you can get it paid.

Collections will kill your credit, and if you think your phone rings off the hook now, just wait.

okay wulf and jcemt talked about talking to them and working it out..

I agree in most cases...

it is in your best interest to TRY and talk.... but the amount they say you owe...no WAY don't pay!!! deduct the interest rates ... and then agree to pay it...and get proof you paid it..don't ignore phone calls..they will hound you for the rest of your life and your grandchildren to follow! if you are a very strong person you can ignore this after the c/c collection limit...most people will choose to pay and get them out of your life for good!

Err. Socks, the poster's still dealing with the original creditor. Best not to ignore it.

I didn't make myself very clear I guess ..
I was trying to say pay but try to talk down what they are saying you owe

I've decided to send them a letter at 30 days, 60 days and then I will talk to them before I'm 90 days. Sometimes Chase has been known to send you to collections by 90 days.

I work with credit cards after they are 90 days due. By the time you card is almost 90 days due you will have to pay the total due to keep it out of 3rd party collections.

I very recently spoke with a woman who sent in 75 dollars to pay down on her card because she thought that would keep it from progressing to a 3rd party agency. It didn't because she was still about 200 dollars shy of her paying the total past due balance. She was extremely upset and I can't say I blame her. She didn't know the in's and out's.

If you can work out something sooner you need to do it.

Another thing, it's not only when you are 90 days late they send it to collections it's when you have had a past due balance for more than 90 days. So if you are blindly mailing in payments but not covering the past due then it will still go on to 3rd party collections.

Sometimes you will be able to enter an agreement with the creditor and set up payments by post dated checks through their system that could stop late fee's and potentially lower the interest.

I wouldn't proceed by letter at this point. I'd pick up the phone and call them. [I'd still record the call, but I'd call them.] Lotsa times, I get a more favorable reaction on the phone or in person, than via letter or email. Once I had something nailed down, I'd confirm the details in writing.

Just curious, but why would you record a call with your creditor?

Couple of reasons:

I use the recording as a reference. Helps me remember what was said, by whom.

Also handy for taking notes, without being distracted by writing while talking/thinking.

I agree that you should definitely call them. Let them know what situation you're in now, and you might also see if they are willing to defer a few payments, or reduce the minimum payment to something you can afford.

Ignoring them is the worst thing you can do right now, it just screams, "I'm not gonna pay you!!"

I'd much rather deal with my CC company than a collection agency, anyday!

Can a collection agency take your house if it is paid off and you have no mortgage on it? Can they force you to "refinance" so they get their money, if you are unemployed?

Not entirely certain on this but I know that many states consider property exempt from judgments. They cannot force you to refinance your home either (as far to my knowledge) Even if you did reside in a state that would allow anything to be done with your house in regards to a judgment unless the amount of your debt was more than the value and/or equity of your home the most they would be able to do is place a lien on the property.

That would just mean that if you sell it the lien gets taken out of the proceeds before you are paid. Did a collection agency threaten to take your home? If so who was the agency and what state do you live in?

[quote=ram.gree]Can a collection agency take your house if it is paid off and you have no mortgage on it? Can they force you to "refinance" so they get their money, if you are unemployed?[/quote]

In most cases, no, unless you've used the house as collateral. It varies by state, though. As JCEMT said, usually all they can do is lein it. Lots of places, they can't even do that.

Thanks for all of your replies. I owe a total of $30k in credit card debt & am trying to settle it down to $15k. Is this best done with the original creditor? Will they settle or does it have to go to collections in order to do this?