Credit card debt....already in collections.....?

I have about $5000 in credit card debt; it%26#039;s been about 8 mths since I paid any on them. I was out of work due to an auto accident. I want to pay them so consolidation or bankruptcy is not an option for me. I just can%26#039;t afford much. $50 extra a mth is all I can afford right now, but I don%26#039;t know how to do this because I have 4 different credit cards %26amp; $50 doesn%26#039;t split well. The agencies say they can%26#039;t settle for less than $100 on each card....well I just can%26#039;t do that as I am just now getting back to work.My question is this:since it%26#039;s been so long since I paid on them anyways %26amp; they are already in collections do you think this woud be a good idea %26amp; if not then what would you suggest. I was thinking of listing all my credit cards with the balances %26amp; take the smallest balance %26amp; pay them $50 a month (more whenever possible) %26amp; once that one is paid off start with the next lowest one %26amp; repeat this untill they are all paid off. Will this work or is it a bad idea...what do you suggest?Thx

Credit card debt....already in collections.....?

Frankly trying to pay a little bit on all 4 accounts is not a good idea. The collection agencies do not want to small payments strung out over long periods. That $50 is not even going to keep up with interest and fees on one card let alone all four. Small payments will just keep resetting the Statute of Limitations (SOL), the timeframe to bring lawsuit. The collection agency can take the small payment and sue you anyway.

Put the $50 aside and look for ways to bring in more cash -- garage sale, collect alum cans, second job. Collection agencies are more likely to work out a settlement for less if you have a lump sum. Also, the older the account the more likely they will settle for less. Any payment plan would have to be short term -- less than 6 months. Get any settlement agreement in writing, including any small payment plan. Do not give them direct access to your bank account.

Credit card debt....already in collections.....?

I would say bad idea ...I think the smart move would be to consolidate and work down the balance from there. CC companies recently have been coming down hard on those who owe outstanding balances, there are even times when they will take you to small claims court, and there is also the fact that your credit will be shot.

Credit card debt....already in collections.....?

If you take the 5k and divide it by 4, that%26#039;s about 1250 per cc. Paying 50/mnth would take you 2 years to pay off each card. The last one would expire off your credit report before you could even get to it. but it does sound like a plan....only if your current situation improves and you can up your payments eventually. 5k isn%26#039;t enough to file bankruptcy over..IMO. But if you start having problems paying your mortgage, then that is the better route. Also, this is all assuming that they aren%26#039;t adding interest/fees to your ccs as you are making payments. Since your credit is going to be jacked no matter which way you go, offer a settlement for less than whats owed

Credit card debt....already in collections.....?

Well, since consolidation is not an option for you, I guess paying ANYTHING is better than nothing. I%26#039;m not an expert, or a banker, or a debt counselor, but in my experience, these people just want their money, one way or another. Your credit is already destroyed, so I don%26#039;t see why paying a little at a time could be any more harmful then bankruptcy. Good luck, and kudos to you for wanting to pay!

Credit card debt....already in collections.....?

Why do you feel consolidation or bankruptcy is not an option. Neither of these options precludes you from paying the debt off, they are simply tools to get a handle on a run away situation. Of the two, consolidation is obviously your best choice. If you own a home and have equity in it, a home equity line of credit for $5000 is a very good option, and I%26#039;m sure the interest will be much lower than what the credit card companies are charging.

If that is not an option, negotiating with the credit card companies either directly or through their collection agents is your next option. Tell them they either need to accept your offer, or you will need to file for bankruptcy. Bankruptcy is a messy business for all parties involved, so they may be open to negotiation.

Worst case, filing bankruptcy will allow you to stave off the creditors with the help of the courts while you get back on your feet. The court will come up with a payment schedule that is reasonable for all parties. Filing bankruptcy wreaks havoc on your credit rating, and should be used as a last line of defense, but sometimes it%26#039;s necessary.

Credit card debt....already in collections.....?

It went to agencies because it went past the 6 month marker.

Also, bankruptcy is not the option it used to be. You will not be able to claim it. The bush Administration changed the laws in 2005 in favor of the credit card companies - making it more difficult for the individual in debt to file bankruptcy (which is viewed as a fianancial escape).

Consilidation companies take a fee. They say they don%26#039;t but will. They call it a manditory donation or something bogus like that, but they will take about 10% which would be $5 of your $50. what they do is essentially the same as what you can do yourself.

It%26#039;s all about negotiation. Some tips I can give are these:

1) Play the different agencies against each other. They all want money and will tell you different manditories but in reality there is no rule. They are just trying to get $ from you any way they can. You still have the power because you have what they want. So be strong in that fact. Tell one agency that another agreeded to your terms (don%26#039;t say what they are) and further say that if they can%26#039;t agree to your terms the money will fo to the other credit card (the other agency). Just say %26quot; seriously I cannot give anything more the $50%26quot; and stick to it. If they argue, say you will be happy to give it to the agency that is working with you.

2) Get another job and save like crazy. Are you pinching every penny possible? $5000 is not too bad, and you would be surprised how quickly you can save this working non-stop and not buying anything. Even if the jobs are shitty, swallow your pride and just get it done. Your life will be better in the long run.

I%26#039;m 29 now and a lawyer. I was a girl who loved buying clothes my freshman year of college. I racked up $8000 over 9 months that first year! It defaulted and was sent to agencies. I did exactly as stated above. During summer break after freshman year at college I worked at a factory 1st shift all day, then at McDonalds late night. In between I tutored foreign students with their homework in English. Doing this for those three months I paid all the $8000 without any help from anyone else. It was not fun, especially the first few weeks were the worse; but after that it was no big deal! The next summer, with no debt, I busted my butt again just to earn some huge cash because I knew I could. I still had time to hit parties with my friends too! It was a great character builder and in some ways contributed to where I am today. Mainly by not being stupid with money and realizing it%26#039;s intrisnic value. Good luck!

Credit card debt....already in collections.....?

Jennifer posted a good answer. Your plan sounds feasible but would take awhile. To counter this you would have to considerably increase those payments, but as you said $50 is all you can afford currently. You can follow your plan and see how it goes, as it shouldn%26#039;t %26quot;harm%26quot; your credit or score by making payments, in the end even though it make take awhile it may help you in the long run by lowering the debt amounts.

Credit card debt....already in collections.....?

Are you making only the minimum payment due on your cards each month, and watching the amount you owe rise with each billing cycle? Do you use your credit cards to purchase everyday household items, like groceries, that you used to buy with cash? If you answered yes to either question, you閳ユ獧e probably dealing with mounting credit card debt.

Credit cards are extremely easy to use, but need a great deal of discipline to avoid getting into unmanageable debt. A credit card debt is an unsecured loan, because the credit card company does not hold or 閳ユΞecure閳?any of your assets to cover the amount you owe the company if you are unable to pay your credit card bill. When you default on a credit card payment by stopping making payments altogether, the credit card company will try and recoup its losses by contacting you, typically through a collection agency.

The key to credit card debt consolidation is to avoid getting to the stage where you閳ユ獧e receiving notices and calls from a collection agency. You can do this by taking control of the situation and cutting unnecessary expenses so you have more money to put towards your monthly credit card payments. If the amount is too large, you could consider contacting the credit card company and negotiating a reduced interest rate, and a reduced or waived late fee, to help you pay the debt off. Another option may be to go through a debt consolidation company, which will negotiate on your behalf and take over all communications with the credit card company and collection agency. Remember that even if the credit card company agrees to an interest rate reduction and late fee waiver, information on the payments you didn閳ユ獩 make will still be reflected in your credit report.

Credit card debt....already in collections.....?

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Credit card debt....already in collections.....?

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