Getting out of Debt?
fantana06x asked:
I currently have 6 seriously delinquent/charged off accounts totaling about $9,000 and one $11,000 car loan that is current and paid on every month. This is technically my only revolving credit. I can’t get a loan anywhere and am denied any type of credit and i don’t own a home. I need to get my debt settled and want to know the best way to to that. I’ve heard conflicting information on charged off accounts. What is the best way to handle these accounts? In particular, I have about 3 accounts with balances over $2,000 that are charged off and some sold to outside collection agencies. My oldest debt is about 3 years. I’ve even heard that charged off accounts should just be left alone as if they will disappear with time! That can’t be true?
I currently have 6 seriously delinquent/charged off accounts totaling about $9,000 and one $11,000 car loan that is current and paid on every month. This is technically my only revolving credit. I can’t get a loan anywhere and am denied any type of credit and i don’t own a home. I need to get my debt settled and want to know the best way to to that. I’ve heard conflicting information on charged off accounts. What is the best way to handle these accounts? In particular, I have about 3 accounts with balances over $2,000 that are charged off and some sold to outside collection agencies. My oldest debt is about 3 years. I’ve even heard that charged off accounts should just be left alone as if they will disappear with time! That can’t be true?
Is it better to consolidate all my debt with a non-profit debt consolidation company?
If i choose to negotiate myself can I negotiate directly with the original company for a lower pay off or do I need to negotiate with the outside agency?
Jose
Tags: 3 Years, Consolidate Debt, Non Profit Debt Consolidation
July 14th, 2009 at 2:17 pm
Jill
honestly just go to oprah.com she has done so many shows on problems similar and more drastic then yours.
July 15th, 2009 at 11:15 pm
Jason
get an accountant or whatever.
write out a table and get organized.
use cash more than credit.
don’t worry, i’m in deeper =[
July 16th, 2009 at 11:06 am
Wilma
if its been turned over to collections just don’t pay, wait 7 years and it will all disappear.
July 19th, 2009 at 7:34 pm
Heather
just leave and dont get caught
July 22nd, 2009 at 7:24 am
Monica
I think you need to see some professional people to help you on this… but only if you are serious and ready to deal with the issues.
Consumer credit counseling comes to mind.
It’s going to be years before your credit is repaired, and professionals can help you make that repair much faster.
Of course, that assume you don’t have a pile of cash available to pay everyone off.
July 24th, 2009 at 9:02 am
Ted
Some of the research I have done online in an attempt to help a friend has proven that yes, debts will really fall off after 7 years. While it’s not a great solution, sometimes it’s virtually impossible to pay off debts when you are in over your head. One bit of information I read about this is that if you even speak to the company that is trying to collect (or the collection agency) that you can potentially start over the 7 years, so if you aren’t going to pay off the old debt then I wouldn’t talk to them.
Also, the more research I did about debt consolidation I found that most people say don’t do it. They say that if you have gotten this far into debt already that it will be very tough to make a payment to a consolidation loan. I think what may be the best approach would be to run your own online credit report and see what debts are on there- you can do this for free without subscribing to anything at this link:
and I would pick the most recent debt and work on paying that off, once that’s paid move down to the next one, and the next one and so on. Do NOT quit paying on anything that you are currently paying on though. Just start paying on the most recent debt and work your way through it. Once you have been doing that for a while either you will get caught up, or by the time you get to the debts lower on the list some of the old debts may begin to fall off. And whatever you do, don’t get into any more debt! You can have this all resolved within a few years if you stick to it.
Good Luck!
July 27th, 2009 at 1:21 pm
Ricky
get jars. (or envelopes)
one for food
one for rent
one for utilities.
one for your car
one for clothing
Now. How much do you make per month, you have to take 50$ per week and set it aside for groceries. If you spend more than that (per person) per week, you are WAY overspending on food. (this includes any take out, movies etc)
if you are spending more than 40% of your income on rent and utilities, you are going to have to move to a place where you reduce that or you are going to have to make more money
Any extra money that you have you will HAVE to put down on the debt because the interest on the debt is killing you. Getting those paid off is your priority!!!!
Sell the car, is my advice, and take public transportation. Vehicles depreciate as soon as you drive them off the lot.
July 29th, 2009 at 7:59 pm
Christina
I had a great deal of debt in the past. It was close to impossible to pay off all the debt I carried. At one point it reached $27,000 + in just credit card debt, Starbucks wasnt really helping. I needed a way to pay off the credit card right when I had money in my hands. For example, you have $20 instead of spending it you pay it toward the bill. But your having a problem holding on to cash till the billing cycle… Find a IPPP Payment location near you. Pay any amount at anytime. This really helped. from personal experience I ended up spending the cash only to have just enough for the minimum payment. I hope this idea helps, try not to lean towards bankruptcy.
August 2nd, 2009 at 4:34 am
Nellie
I used to work for a third party collection agency for Citibank in California 8 years ago. Our agency was the third placement of deliquent accounts. We received 45% of every dollar collected. If your debts are 3 years old they are probably in that range. The first thing you should do is pull your free credit reports and see if a collection agency has placed the debt on your report. If they have during negotiations make a contingency to pay is that they remove it.
As for the original debt yes it should fall off your report 7 years from the charge off date. Some creditors will refresh the last activity date when you pay off the debt so that is tricky one.
What I would do is take the newest charged off account. Call the collection agency and offer .40 on the dollar. They will immediatley pull your credit report to look for inquries to see if you are trying to buy anything. MAKE SURE YOU HAVE NOT APPLIED FOR A CAR OR HOME LOAN. No one will discount your debt if they see that.
Call from a phone that you do not mind other creditors finding because once you make contact they all will soon find you.
Stay away from debt consolidation companies. They will charge you. The one thing you want is a letter from the original creditor or collection agency on company letterhead detailing exactly what should happen.
I would bet in some cases you could settle your debt and get them to agree to not indicate “SettlementAccepted” on your credit report. An ideal end would be to have the debts paid or settled and to have the credit company just refelct a paid charge off account w/o reflecting a date refresh.
Good Luck. There is a lot of ways to do what you need to hopefully others give you advice and you can decide what is best for you.
August 4th, 2009 at 3:29 pm
Carolyn
What you need is a plan. The last thing you need is a loan or settlement. A debt management program like Consumer Credit can help you but it’s not easy. You don’t want charge offs, bankruptcy, etc. If you can’t negotiate your own management program with creditors, check out the non profit organization below:
August 8th, 2009 at 3:21 am
Sandra
There’s nothing a consolidation company can do that you can’t do yourself.
If the original company has hired the agency to collect the debt, then you can negotiate with the original company.
But, if the original company has sold the debt, then they have already been paid, and you have no choice but to negotiate with the collection agency.
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Now here’s the real reason your finances are a mess: Your $11,000 car loan.
SELL THE CAR!!!
There’s a six-minute video on this web site that talks about how turn car payments into wealth:
August 10th, 2009 at 12:04 pm
Jared
The biggest problem is that getting one big debt consolidation loan won’t help if you don’t correct the problems of overspending that got you into the situation in the first place. What typically happens is that people consolidate, then something happens (car engine blows up, kids need braces, etc) and you end up putting that on a card and end up owing even MORE than prior to consolidating!
I like Dave Ramsey’s approach to personal finance. He defines a 7-step program for personal finance in his “Total Money Makeover” book. The 7 steps (known as “Baby Steps” are:
1) $1,000 to start an Emergency Fund
2) Pay off all debt using the Debt Snowball
3) Three to six months of expenses in savings
4) Invest 15% of household income into Roth IRAs and pre-tax retirement
5) College funding for children
6) Pay off home early
7) Build wealth and give! Invest in mutual funds and real estate
There’s not enough space to go through everything here, but the idea is to build an emergency fund that you can use to handle unforseen issues that might come along.
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August 10th, 2009 at 9:25 pm
Charles
Opt for a debt consolidation loan: The easiest method of getting a debt consolidation loan is to utilize the equity of your home. Equity of your home is calculated and determined by the difference in the amount you have paid and the amount you owe. If the amount you have paid is more than the amount due, you can use it as collateral. This allows you to borrow money on lower interest rates. Besides, you also get tax benefit on this type of loan. Consult your tax advisor before opting for this loan.
August 10th, 2009 at 9:55 pm
Lori
I will suggest you to go for debt consolidation loan. I have one site just try it. I am telling you because i have my personal experience on it and it is very genuine. Hope you will be also satisfied.