The dreaded payday loans and filing Bankruptcy

I live in TN. I have filed for Chapter 13 Bankruptcy & included my storefront & internet payday loans. They have all been sent notice from the Bankruptcy Court to file a claim but only 3 have responded. You can usually speak with an attorney for a free consultation to know the laws in your state.

Payday loans are unsecured debt and can be included in BK just like any other debt.

i called and talked to an attorney today and they told me you can include paydayloans with bk. i have a consultation on friday. they told me to add up all my debt before i go in. so far i am up to a little over 18,000. sadly enough 9500 of that is payday loans. i know i have no one to blame but myself. hopfully it will work out though. i'm tired of living the life of debt. i mean i seriously have been busting my hump trying to pay things off but it seems like the more i pay the more behind i get, not to mention for the last 6 months we have been paying 1300 every two weeks just to renew the payday loans. some have slipped but the majority we've kept going. but we cant do it anymore. debt makes a person want to just dissapear.

i kinda had a crazy day, i had a consultation with an attorney agency today about my situation. didnt take long for them to decide i definetly qualify for chapter 7. i had to talk to a paralegal, so everytime a serious question came up he would have to run and ask the attorney then come back and tell me. so we talked about price and agreed on a retainer fee and he said let me ok it with the attorney i'll be right back. so like 15 minutes later he comes back and said i need to pay double what we agreed on for the retainer, then said i would need to make two more payments of 500. i was like no way, then the guy took off with my drivers license and debit card. finally somone diffrent came into the room with my license and card and i literally snatched it out of his hand and ran out the door. i literally felt like i was at a car dealership.

after that bad experiance i wasnt feeling too confident, but i called an agency who set me up with an independant attorney who contracts through their website, they guy acually turned out to be pretty cool, he was straight up and didnt beat around the bushes. after i got home i googled him and didnt find 1 negative article about him, i acually found a few good articles about some of the work he has done in the state. and was also almost 1k cheaper than the 1st attorney i went to. so i went back and paid the retainer fee. i'm feeling pretty good about my choice.

the first attorney i went to was a big flashy attorney office who has those commercials on late at night with the cheezy jingles, the attorneys walk around with their big ol suits on and drive their bentleys and ignore all the people waiting for them in the waiting room. it was really a bad experiance. i feel sorry for the people they take advantage of and screw over, they litteraly set up a sting operation and wont let you out the door until you agree to give them tons of money. i'm just glad i got out and didnt let them pressure me to the point i gave in. it really worked out for the better.

Crazy experience. When I hired my attorney, I had a consultation with him personally on the phone, which lasted about 30 minutes. He gave me the total price, and the retainer, which was only $50. In fact, he let me give his number to my creditors before I even paid him the retainer. That seems to be the benefit of going to a local attorney, who has been practicing bk law here for almost 30 ears.

its been a few weeks now and i'm still glad i made the right choice going with a down home attorney and not the big flashy putting on a show attorney. for the most part the creditors are leaving me alone. i still get 2-4 calls a day but i am slowly weeding them out. and thats not bad considering we defaulted on 11 payday loans a few weeks ago. it was the biggest burden lifted off our shoulders. i'm not happy about filing bk but between the payday loans and the other stuff thats been following me around for the last 5 or so years its finally a relief to get my life back and be able to start over. i mean my whole family has been suffering for years because of the choices i have made and its not fair for them to have to suffer for my stupidity.

update: i am now approaching the 90 day mark since i defaulted on everything, my attorney told me we would file around the 120 day mark so we got about 30 days left. everything is just sitting in line and waiting. i'm ready to get this over with. but i already feel better knowing everything is in place and we are just playing the waiting game. and by the way cash one who i posted about earlier told me i would be served within 48 hours, still havent heard squat from them.

I have been reading your posts, and you make me feel so much better. Our situation is almost identical to yours. We did go to an independent atty last week - they were very nice and understanding. We too, have about 15 PDLs, none of which we've defaulted on. I am curious - have any of them called your employer or references? I need to keep my job and having them call my boss would be the last thing I could stomach! Also, did you need to send letters stopping ACH withdrawals, etc., or is the atty handling all this for you? Thanks!

thanks for reading my post. we had over 9k worth of payday loans total. some defaulted, alot were still current. the best advice my attorney gave me was "stop paying them" he said "thats how you pay me is you quit paying them". i know it seems like an endless black hole but just hang in there and you will start to see light at the end of the long tunnel.

now as soon as you stop paying them you will feel a burden lifted from your shoulders, but you also get a stress of another kind. these people are bounty hunters, they will do whatever they can to try and "trick" or "scare" you into paying. the best advice is stay strong. they will call you repeatadly. they will call your job, and your refrences. there are things you can do to prepare or try to lessen the blow, alot of them when i gave them my attorney info they pretty much backed off. there were a few sticklers that continued to call. i sent the cease and desist letters, some wont abide by it, some dont have to. but i dont feel like i wasted my time. second tell your boss you are having some problems but its being taken care of, but tell them you might get some calls and if they could please tell the person its not ok to call you there then it might help. as well as your refrences, just tell them if anyone calls asking questions about you to tell them wrong number or somthing, it will slow them down. also if you happen to get a call while you are at work just continue to tell them "do not call this number" and hang up on them. eventually they will get the hint. now dont let all this scare you, i would say after the first week or two is when the storm hits, but it will really slow down and be easier to work with once things start getting sorted out. they will also tell you they are taking you to court, chances are they are blowing smoke. just tell them to call your attorney and hang up on them.

so all in all in the end it is definetly worth every second and penny spent because you are taking your life back into your control. and i dont believe you can put a price on being able to live happy. good luck and let me know if you have any questions.

Been there done that. PDL are what caused our down hill spiral into a Chapter 13. About 3-4 years ago, I got caught in the PDL cycle, it went completely out of control and the next thing I knew I could not pay my other bills and was barely able to keep my household expenses above water. I needed up "stop" paying, however I stop paying everyone, paid off all but 3 PDLS, and filed BK at the end of August and yes those 3 PDLS were included in our case.

It was a bad situation, and a BIG learning experiences!

Good Luck, Reny

i filed bankruptcy because of large bills and payday loans (if only i had known those loans were illegal and i overpaid them!) stupid me got into debt after that but am almost debt free (just one more debt that junk buyers keep buying and not validating and some odds and ends with monthly bills).
good luck, please keep up with the updates.

Thank you all. I am just so darn worried that these companies will bring a summons to my work - ugggghhhh how humiliating! My lawyers says that once they get wind of him, they probably won't bother with a lawsuit, as they know it will go away with the BK. They have gotten so much of my $$$. I hope they will just back off. Very scared right now.

Did you have any of these: Payday One, Salary Fast, Integrity Advance, Check n Go, Checkmate, Money Tree, Ace?

i did have payday one and ace cash express. ace called a few times but eventually stoped. i havent heard anything from payday one. i do believe most will leave you alone after you give them your attny info. just remember to stay strong. you can do this.

Also if they do harrass you after you are in bankruptcy protection, you really can sue. my lawyer wanted me to after a loan company kept calling me and telling me to pay my bills (they lied and said they recieved a discharge) but i was so worn out from filing (plus i mostly filed because of medical bills so i was not feeling healthy) that i just kind of gave up.. plus i do not think he really was honest about how much money i could have made through suing them.

Bastoops: Were any of your current PDL's on an automatic withdrawl system with your checking account? We have 2 that automatically take the interest payment out of our account when my husband gets paid, how do you get them to stop?

I'm wondering if this is where I am headed. My husband and I just got married in July, and he has a bad credit history due to some credit cards he had back when so everything was put in my name. We also went to get a loan from Citifinancial to consolidate some of them. We owe them $6,800 and most of our payments go to interest. We cannot buy a house without a huge amount down or better credit and I don't see that happening anytime soon. I have some current credit cards that we are defaulted on because we got stuck in the payday mess, getting one to pay off another, or getting one because we coiuld not make rent or the vehicle payment that month. My question is, when you file bankruptcy do they take your vehicle lease also. I am still paying on my vehicle through my bank and owe for two more years. We share our vehicle, my husband and I, and this is all we have. I don't want us to lose our jobs because we cannot get to work? That in turn will make us loose our home also even if we are renting. What would you suggest. My payday is this coming Thursday so I need to know whether I try to go talk to the payday people and close my bank account, or if I need to go talk to an attorney. Please give me any advice you may have.

I also have the same question, How do you get the online payday loans to not take money out of my account? They are due tomorrow so I have to call tonight and see if there is some way I can cancel the online business, or even postpone it so I can withdraw the funds from my account. My and my husbands paychecks are direct deposit, so It's going to be difficult. Please give me some advice.....Thanks

Kristi,

My attorney suggested that we CLOSE our bank account - but FIRST OPEN A NEW ONE. We are in a bit of a different situation - ready to file BK, BUT, the only way to stop them is to switch bank accounts. Go to a bank that you don't owe any money to for any reason. Then you can work with the PDLs on YOUR terms. If you end up filing a BK, you WILL be able to buy a home eventually. And NO, your car does not need to be included in the BK. You can keep your cars. Get a really good lawyer, and I suggest not a "commercial" one that you find on TV ads in the middle of the night. :-) I searched for "debt negotation attorney" and found a wonderful one. Good luck!

You need to close your bank account, but FIRST open one at a bank where you do not owe any money. Many of the "interest only" or "rollover" PD loans are ILLEGAL in many states. Check with Shazzers - she will give you great advice on this. If illegal in your state, my understanding is that you are only liable for the principle - no interest. So, for example, if the loan was $300, and you've already had interest deducted in this amount or more, you are finished paying them. Ask the companies for their lending license in your state. Bet they won't be able to produce one!

Thanks for the info. I do however have one more question. The only vehicle my husband and I have is through a loan at the bank where I have my checking account. I have already closed out the old account and got a new account number with the same bank. There is no way for anyone to get that info and withdraw cash, so I am good there. But, our paychecks are both direct deposit into this account. Would it be best to cancel our direct deposit for now until this whole thing blows over. Will bankruptcy effect my checking account? We are going to continue paying the car loan off, but I want to make sure I have all the details so I can atleast act like I know what I am doing to some point. I really want to keep in good standing with this bank because they will be my only life line once this is all done.

hey. sorry it took me so long to reply. you did good by closing your bank account. they will not stop hitting it until its closed or destroyed. you shouldnt have a problem with your direct deposit going into your new account. as far as the vehicle you really need to speak with an attorney. from what i understand all they care about is the equity you have in the vehicle. and if you are filing joint with your spouse then you are allowed a little more for a vehicle. chances are if you are still paying on it then you dont have alot of equity built up in it. we have 2 vehicles, one paid for and the other one we are still paying for, but since the one we own is under the "value" we are allowed, we get to keep it, and the vehicle we are paying for has no equity so we get to keep that one too. bankruptcy wont affect your checking account. although i do remember my attorney telling me that when they acually file my case we are only allowed to have 300 balance in our checking account. i'm getting ready to pay the rest of my retainer soon, i am just getting all the paperwork together to turn into my attorney, they have to have 6 months worth of pay stubs, tax returns, bank statmens, titles to vehicles. there is a whole bunch of stuff you have to give them and i put it off to the last minute. if you have any other questions i am glad to help with what i can. i will keep you updated on the whole process as it unfolds as well, because i've never been in this situation before either.

We have stopped paying everyone and the calls are outragious. But, we go on the 13th to pay the total fee and I guess file the paperwork. I have already gathered all my info, and showed our lawyer everything at the consultation. I didn't have 6 months worth of paystubs, but just faxed them to her yesterday. I'm just terrified of getting into trouble for hot checks or something for all the payday loans we have. They have tried to send them in, but they all got returned due to account closed. My bank is being really nice about it. So, I guess if there is a maximum amount of money you can have in your checking, I will need to go withdraw my funds shortly after the direct deposit goes in the bank. Thanks for the info, and yes let me know how things go for you, and of course, I will keep you updated on how the process goes for us. Take care.

Hi Kristi,

Sorry it took me so long to reply. We have two car loans, and our attorney tells us that we will be able to keep both - as long as we make the payments by "reaffirming" them after the BK.

As for the direct deposit, we STOPPED all DD and carry live checks into our new bank. Seems to be fine. We, too, have a car loan at the bank where we closed the account, and they've been great. They did tell us to file BK asap, so that if the PDL companies try to sue, they won't be able to garnish any bank accounts. Once you have a BK filed, the bank/credit union should be 100% supportive.

Hope that helps. Good luck.

We have since filed our Chapter 13 and no one has attempted to contact me since this has happened. I was told that if we ever wanted to get any new credit we would have to pay a fee to our Trustee though. It's a pretty hefty one of $300 something. My question is does this fee apply to something like a home phone. We only have cell phones, and I really want to get rid of the texting etc, and just have basic cell phones, and get a home phone. But, in order for you to get a home phone they usually check your credit. Will I have to pay the fee to get a home phone? Surely since it is a utility I wouldn't. Does anyone know anything about this???

Thanks
Kristi

Okay here is what you need to do, first get a new bank account while your credit is good. Next cancel your bank account with all of your payday loans then just don't pay them. These payday clowns can't do anything nor did the BofA, because the account was closed. The payday places will call like crazy and also send letters but they can't do anything I had 15. Now I can say that I paid them and they couldn't find my check, or a family member got a hold of my check book and I didn't want to turn them into the police. Or you may tell the truth and say they were ripping me off and I'm not going to pay them, also do be scared to turn pdl to the better busines bureau. You can say things like they tried to charge me with two loans and I only had one, they raised the fees and what ever non honest stuff they did to you. Best thing to do is let your boss know you got in a little trouble, like I had to bail my mother out of jail, or I lost money on a bet or my car blew a engine or my kid in college had to come up with a few grand in a hurry or the would be kicked out of college and that is why I took out 15 payday loans.

I am trying to file bankruptcy on my online payday loans,but the one attorney I have seen says he must have their physical adress to contact them.I have no idea where they are located,and they wont give me a adress....help!!!!

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i agree, the BBB has most of the addresses here.. a problem i faced was with lenders who had overseas addresses.

hey everyone its been awhile so i just wanted to give a quick update. we hit a little snag in the road but are now back on track. we will have our attorney paid in full within the next few weeks. they said after that they will have my case ready in two weeks, then i review everything and once i turn it in they will have it filed. its been about 9 months since we decided to go this route so we are definetly ready to get it over with. i'll let you guys know what happens during the process, its the first time we've had to go through this and i know there is alot more people out there who are in the same boat as me but not sure what to do. so hopfully my experiance can be used to help people.

finally got it done. my attorney is paid in full and my paperwork is turned in. the hard part is over. they will be contacting me in the next week or two to go over my petition so we can file it. it should go pretty fast from this point on considering how slow the last few years seemed to go. thanks everyone for your support and i'll keep the process updated.

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you can say that again. its definetly a chapter of my life that i'm ready to put behind me and forget about.

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hey everyone, its been pretty slow going so far. they say they will have my petition ready no later than 7/27. then i just have to approve it. so hopfully within the next few days it will be ready to file. i need to take my first class this weekend. i havent done it yet but i'm getting ready to. but other than thats its been pretty quiet around here. i'll keep the process updated as it goes.

hey, just wanted to give a quick update. got our counceling class done. it wasnt that bad. it said allow 30 minutes. i'd say it took about an hour to an hour and a half. i didnt rush threw it though. i was hoping i would learn somthing new. although it did give me some pointers to brush up on and start incorporating again. so all in all it wasnt bad.

i also got my rough draft petition. i got pretty much all of the paperwork and questionairs filled out. they pretty much got everything on my credit. the creditors they missed were mainly payday loan companies, many illegal lenders so their info was not on my credit. i went through tons of letters and bills and got most of the info, there are about 4 companies i need to call and get the amount i owe, and the account # so my attny can update my petition. i'm dreading this part, but i know i have to do it. i know they will give me a hard time. i'm not sure if i should just lie and tell them i need this info so i can pay them, or just tell them straight up i need it for bankruptcy. i know they can give me a hard time, but can they really deny me this information? i'm just trying to figure out the best approach. i was hoping i wouldnt have to call them, but i dont really know how else to get this info from them. any advice would be helpfull. so basically thats it. as soon as i get this info from the last 4 creditors i'm missing, i'm ready to turn in my rough draft, they will type up a final. then i have to have 1 final meeting with my attny and then its ready to file. hopfully it will go by fast. i know the worst is over, and still have a little ways to go. but can finally start seeing light at the end of the tunnel.

I'm gonna be defaulting on 6 PDL this week... when they start calling me if I tell them that I am gonna file bankrupt (even though its a lie) will they work with me better?

brokeasajoke- i dont think it would make a diffrence in the way they work with you. most companies dont recognize bankruptcy until you get the acual case # anyways. i had a few places that quit calling, but the majority of them are still calling me. the best advice i can give you, if you truely want to try and pay them back you need to call each individual company and find out what kind of arrangments they can work with you.

Alright i got my creditor list done. i dont know why i dreaded calling the payday loans so much. probably because i spent the majority of my time trying to get them to quit calling me and then i had to turn around and call them myself. but it acually went pretty smooth and fast. not one of them gave me a hard time. i just asked for the info and they gave it. end of call. couldnt have been easier. now i have to meet with my paralegal on friday to go over the final petition and then we should be ready to file anytime in the next week or so.

met with my paralegal yesterday. gave her all my remaining info. we decided to go ahead and file on wed the 25th. i ended up getting served a court summons a few days ago from one of the payday loans. i thought at the time it was kind of funny. my paralegal also said she thought it was funny. she said it cost them 500.00 to take me to court, i only owe them 612.00. i dont know if they are banking on me paying for the court cost as well. but it seems like its not really worth spending 500 to make 112. after all the time and effort. but either way it doesnt matter because i have 20 days to respond to the summons and i will have my case # in a week from today. she said as soon as i get my case # they cant touch me. but she said my case was pretty simple and easy and she expects it to go very smoothly and no problems. so that is good to hear. its been a little over a year since i decided to go this route. and finally not only can i see light at the end of the tunnel but i can see myself nearing the light at the end.

Paralegal is wrong....the court and legal costs are assessed to you in judgemnet so it really wouldnt cost them anything.

thats what i figured. but since it will never get that far, do they still have to eat the fees or do they only pay if they acually end up taking me to court. i mean the've already started the process. dont they have to pay upfront for the filing, and then if they get the judgment they include the court cost in the judgment.

With your bankruptcy filing, they end up eating the fees.

alright, tomorow is the big day. just a little over a year since i decided to file. but a good 7 years in the making, so you can imagine the relief. especially here lately as things have been getting crazy. i'm not really nervous. just ready for it all to be over with. got my paperwork ready, got my appointment in the morning. everything is set to go.

and, i finally got my case #. whew. great timing too, not only did i get served a court summons last week, but i guess yesterday there was a guy harrassing my inlaws saying he was an attorney and was asking them all kinds of questions about me. i called him back after i got my case # and unfortunatly i got his voice mail. but anyways the hard part is done. my attny said i will get a letter from the trustee in about a week, i need to fill out the questionaire and send him any info he request, take my other credit counceling class, show up to my 341 meeting, and after that its just a waiting game. fingers are crossed everything goes smooth and i get a discharge letter in the next few months.

still havent got the letter from the trustee. my 341 meeting is scheduled for oct 1st. i did get a diffrent letter from the trustee saying there were 3 creditors that his letter got returned as "undeliverable". basically it said if they dont recieve proper notification then there is a chance they wont be discharged. i contacted my attorney and he said not to worry about it, that he will handle it. so thats basically it. just waiting around for the meeting to get here.

tomorow is the 341 meeting. i'm kind of nervous but i know it will go by quick and painless. hopfully. i'm still battling with some creditors that keep calling me and sending me letters, i told my attorney and all he said was "give them your case # and they will leave you alone" well, atleast 2 of them havent. i kind of feel like once i give them my case # they hurry up and sell the debt to a diffrent collection agency so they can get out from under it. then the new collection agency starts collecting on it. its just a big cycle. today a lady called from florida claiming to be with the maricopa county check and fraud division and said we were in big trouble. doesnt make sense why a county in arizona would outsource their work to somone in florida? haha. anyways wish me luck as i am ready to get this over with.

wishing you good luck

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thanks Bakerjon, the 341 meeting went quick. we were the first on the list and i was in the chair for maybe 3 minutes. it seemed like alot longer but i know it wasnt. my attorney prepped us pretty good on the questions the trustee would ask. we went over them a few times before the meeting. after he was done asking and no creditors showed up he said no further questions or info is needed at this time. i guess thats a good sign.

Paul, thats a good question and i'm not sure. i wish i would have known before the meeting that i could have said somthing to the trustee about it. i continue to answer the phone and give them my case #. it feels like to me they are playing hot potato with the debts and selling them as soon as i give them my case #, and then its a new collection agency calling. i think we took care of that lady that was calling the other day saying we were in big trouble, she hasnt called since our last convo yesterday. alot of them are payday loans. i talked to this guy a few days ago and he couldnt even tell me who the origonal creditor was he was trying to collect on. but he hasnt called since then either.

I'm still waiting on the paralegal to send me the info so i can take my 2nd credit counseling class. they say as soon as i get that class done then all i have to do is wait 3-6 months to get a letter in the mail from the court. its been a long journey and hopfully will be wrapping up soon. thanks again everyone for your support and help through this tuff time.

Quick update. not a whole lot to update. filed 8/25, had 341 meeting 10/1. all is pretty quiet around here. hopfully will get a discharge paper in the next month or two. trying to be patient. although i am enjoying the quietness for once in my life, i feel like i cant really start moving forward until we get the notice of discharge. i guess its been about 3 1/2 months since we filed, a little over two months since the 341 meeting. i know they say it can take up to 4-6 months before it gets discharged, is that from the time you file or the time from your 341 meeting?