Just starting out and need advice

Date: Mon, 10/17/2011 - 04:51

Submitted by rinth
on Mon, 10/17/2011 - 04:51

Posts: 16 Credits: [Donate]

Total Replies: 7

I'm just starting out on debt settlement, most of our issues started when our son had a catastrophic illness and I had to leave my job and relocate for his treatment for six months while my husband continued working and caring for other children. The credit card debt piled up while we were supporting two households on one income. Thankfully our son is healthy today, but we are struggling with the financial after effects. I'm back to work, but we can't keep up with minimum payments. I contacted them all and asked about hardship and it wouldn't lower our payments, which defeated the point. I also checked into credit counseling and again couldn't lower payments enough to make a difference. Chase offered me immediately to settle at about 80%, which I declined as we don't have the money. After the first of the year we are planning on taking money out of my husband's small 401k to settle. Also, we are not settling my husband's cards, we are trying to protect his credit and he's not authorized on any of mine.

I stopped making payments two weeks ago and the phone has started ringing. I haven't spoken to anyone since the payments became late. What is the recommendation for talking to them, should I talk to them weekly, monthly, not at all? Also, if anyone has any suggestions for these specific creditors, I'd appreciate your input. Can we expect to settle for 50% or less on each of these?

Here is what I have:
Chase $7k
Citi $6k
Discover $4k
Target Visa $5k

Thank you in advance for any advice or suggestions!

Personally I wouldnt be touching any 401k. You will have penalt

Personally I wouldnt be touching any 401k. You will have penalties and tax implications to deal with.

Have you thought about consulting a bankruptcy attorney? Discover, Target and Citi tend to be rather agressive and you are running a risk of getting sued before you settle.

lrhall41

Submitted by SOAPLADY on Mon, 10/17/2011 - 05:02

( Posts: 17315 | Credits: )

Thanks for the info. I'm hoping to avoid getting sued, but it's

Thanks for the info. I'm hoping to avoid getting sued, but it's not the end of the world, we've faced much worse! We have looked into bankruptcy and have decided to not pursue it. With any luck we will be able to avoid using the 401k if the settlements are staggered a little or if we can break it into a few payments. What would you recommend about communication with these companies? Thanks again!

lrhall41

Submitted by rinth on Mon, 10/17/2011 - 05:22

( Posts: 16 | Credits: )

good luck!

Hi --

I am dealing with chase now -- my acct charges off in two weeks so I am much further past due than you -- at the early stages I would just call them once a month and let them know your hardship --

they will try to bring you current -- they will also offer payment plans --
around 90 plus days you can let them know you have X amount of dollars and try for a settlement --

I settled with citibank for 30 percent -- 3 payments in may of this year --
discover I settled for 50 percent -- 1 payment (they do sue) --
good luck!

lrhall41

Submitted by chrissyhen1 on Mon, 10/17/2011 - 06:55

( Posts: 151 | Credits: )

Thanks for the info, this is very helpful. I'm really happy to h

Thanks for the info, this is very helpful. I'm really happy to hear you've settled with Citi for 30%! Were you about 90 days past due with Citi when you settled? Did they offer it over the phone or mail?

lrhall41

Submitted by rinth on Mon, 10/17/2011 - 10:02

( Posts: 16 | Credits: )

All settlements are done over the phone. No creditor will negot

All settlements are done over the phone. No creditor will negotite thru the mail.

lrhall41

Submitted by SOAPLADY on Mon, 10/17/2011 - 10:08

( Posts: 17315 | Credits: )

Ok, I thought it was mostly phone, but I have a friend who recei

Ok, I thought it was mostly phone, but I have a friend who received an offer from Target Visa through the mail, however she had refused to speak to them on the phone. She had no available cash to settle, so after two years of not responding to anything they finally sued her last month. Now she has to make $50 monthly payments, plus attorney fees, until it's paid. The only positive is that at least it's not accruing interest any longer. I didn't ask how much the attorney fees were.

lrhall41

Submitted by rinth on Mon, 10/17/2011 - 10:20

( Posts: 16 | Credits: )

it was all done over the phone -- don't be afraid to talk to t

it was all done over the phone --

don't be afraid to talk to these people -- they do this for a living -- it is their job -- so don't be nasty to them -- it's just how they earn their living --

I've spoken to a lot of different people -- some are nice -- some not so nice --but most of them are courteous --

I did receive some offers in the mail -- but I did get a better settlement when I called over the phone -- you need to call them anyway since if you are going to get a settlement you have to have them mail you a letter confirming everything before you hand over the money. I have also had these settlement letters faxed to me as well.

Most of my settlement offers were done at 150-210 days past due -- the later the better.

and end of month usually better to call in --

good luck -- let me know how it goes :):D

lrhall41

Submitted by chrissyhen1 on Mon, 10/17/2011 - 11:16

( Posts: 151 | Credits: )