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Hello Michael. Thank you first of all for taking the time to answer so many questions here. This site is a wealth of information and I’ve learned a tremendous amount simply by reading your responses to others. I would like your opinion on my specific situation. I live in South Carolina and, due to a series of personal difficulties, I have fallen behind on most of my credit card bills.
I have three accounts with Chase. I have entered into a no interest balance liquidation program with them that I feel comfortable with. I also have two accounts with Capital One. Both have charged off. One is about $500 and one is about $700. They are with United Recovery Systems and Alliance One. I cannot afford the payments they are offering.
My other concern is my JCPenney card. I believe it has charged off as well, but I have not received notification yet. I owe them about $600.
I know even charged off accounts can results in lawsuits and I’m looking to avoid that if at all possible. Would the small debts make it less likely for the original creditors to sue? If the creditor sued, and they received a judgment, I am completely protected based on South Carolina’s exemptions. Do creditors research if an individual is collectable before going to court?
Thanks so much for your time.
I see Capital One lawsuits for under 1k. And there are debt buyers that will sue for balances under one thousand dollars.
You and I would think suing for lower dollar amounts would be a zero sum game at best. But as an aggregate, the performance and return for suing on smaller accounts is measurable.
Most collectors will apply some collectability logic (often using software). The decision to sue someone, who on paper can be seen as uncollectable, may have something to do with:
1. People do not always remain uncollectable. Financial setbacks are often not permanent. A judgment today could become collectable 15 years from now.
2. Debt collection law firms have to pursue the files sent to them, even when doing so does not make sense, if they want to continue to get files.
Hello;
My question is, I recently found out a summons is trying to be delivered to me. I was bored and looked up my name on the county clerks website only to find an open case against me! I had ZERO idea this was happening before this. I have a charged off account with Dell as of 11 Jul 2011, for 5,579$ and Midland LLC., a national collection company using a lawyer out of their Plantation, FL (four hours from me address) office making it look like they’re acting on Dell’s behalf as lawyer, bought the account in July of 2013; after a series of other collections have bought it. According to the clerks website, a case was filed against me 13 May 2014 and a server tried to summons me 21 June 2014. The thing is my job takes me all over the country and this is my parents address and I use it as my home of record, since I don’t really have one, because I live pretty much all over the place. I use this address for my family to live at, in addition to mail, vehicle registrations, etc. My dad apparently told them I live in Colorado, which I did at the time. It was annotated on the servers description on the clerks website that I live in Colorado. An alias summon was issued in August and a Plurius summons issued 13 Oct 2014. Except the address listed on the clerks papers for both those summons, shows an address I’ve never lived at in my hometown. There is no judge, date or time listed, on any of the summons (all blank), the only address for which court to go to is on the alias summons and its crossed out. There are no court seals on any of the PDF’s I saw, only the lawyers signature and a bar# stamp with someone name. So to date, I have not been served and am afraid because of my traveling job I will miss some automatic court date because they couldn’t find me and I automatically lose. Lastly, this is for a dell CC, according to their company statement, they follow Texas state law, I live in Florida. The SOL for an open account in Texas is four years, my last payment to Dell was 06 Jan 2011. This Jan. I understand it becomes time-barred and legal action is past due. Florida is five years. Does this fall under Texas or Florida SOL? Do I have to worry with so many unanswered summons an automatic court date being made? I’m the sole provider for a family of four, I make just enough to live, most times. I have no money to pay them/settle/ make payments or for a Lawyer, so I’m thinking I’m kinda screwed here, if it comes to that. If it does fall under Texas law and it does go time-barred, do I put all my papers together and send the lawyer notice of this to stop the summons? If anyone could give me sound legal advice I would truly appericate it thank very much for listening.
You want to run all of the SOL questions by an experienced debt collection defense attorney that practices in Florida. I can help you locate some that offer no cost initial consults. Just post the name of a larger nearby city and I will email the info to you.
The attorney practicing in Florida courts, in this particular area of consumer law, will know if an originators home state SOL has been applied effectively in your courts, or if that is a dead end defense. They will likely have already dealt with Midland and the attorney many times.
Thank you, for the response. I live close to Tampa, but Bradenton or Sarasota would be better. Also, I noticed in Dell’s term of service that they require arbitration, that neither they nor their customers would take any matter to court and the arbiter findings would be final.
I sent you 3 attorney contacts in an email. Distance should not be an issue with your type of case (all are in Tampa). It would be great if you were to post an update with your progress.
Hi Michael,
After some months now, one of my credit cards has increased my limit from $300 to $3300. I was happy to see the increase, as I’ve been making full payments on time for the past 5 months (which is how long I’ve had the card).
My first question to you is, what is the maximum amount I should charge to my credit card per billing cycle? I’ve read numerous things, like you shouldn’t charge more than 20%, 30%, etc. of your credit card limit, so I’m unsure as to which percentage is the one to follow. I’m happy that my limit has increased, but I just want to make sure that I’m not charging more than I should.
Secondly, is there a set time when credit card companies report to the credit bureaus?
And third, I’ve paid all my Cap One monthly bills on time for 5 months I’ve had it so far. The first couple of months, my credit score would increase by about 5-7 points, per Cap One’s Credit Tracker feature. However, the last few months there was no increase–the credit score always stayed the same. Do you know why my score isn’t increasing anymore, even though I’m paying in full and on time each month? This is the only cc payment I have. I have a student loan payment and I pay that every month, too, so I’m not sure why my score appears to have stalled at the same score for 3 months now.
Thanks for your help. Hope to hear from you soon.
Best,
DMG
I would not be overly analytical of the amount of purchases and charges to your open credit cards, as much as I would focus on having less than 30 percent balance utilization, or balance owed carry over from one month to the next.
How long it takes a creditor to update information with credit bureaus can vary widely. 30 day intervals is common.
You credit score is factored on many bits of information. What are your scores? What negatives show on your credit reports? Were your student loans always current? How long have you been paying on them?
It is not uncommon for credit scores to stay nearly static if there is nothing new added to the mix of factors the scores are based on. And 3 months is not all that long.
You will want to have more than 2 open and positive trade lines eventually. What are your credit and finance goals over the next couple of years?
Michael,
I just received a civil summons from my local county sheriffs dept for a card credit debt that was written off about 2 yrs ago as a result of a divorce and being a single parent of 3 I could not make payments any longer. I had two other cards at the time that I was able to pay off with a repayment plan that was agreed upon between the card company and myself; however GM HSBC (bought out by Cap. One) was not willing to work with me in the same manner as the other cards, so I had to make the choice of providing food and shelter over paying this debt. Now I am being sued by CACH, LLC for the debt they bought from HSBC in the amount of $6,800, my financial situation hasn’t changed in 2years and still don’t have the means to pay it. I have received solicitation letters from local attorneys stating that they will help in keeping CACH from leaving my bank acc or garnishing my wages, however the summons papers don’t state those facts it simply says I have 30days to answer this complaint with CACH’s attorney Lazega & Johanson before judgement by default is taken against me. All of this is taking place in athens, ga. Do you have any suggestions or attorneys I can talk to in this area that have experience with CACH and can help dissolve this action and possibly the amount owed?
I sent you an email with contact info to an attorney near you. Call him and discuss your options. Post an update with how you progress.
Thank you! Do you have any others in my area that I could try contacting? I tried the one emailed to me but it takes me straight to a voice recording, I did leave my name and number; however that did make me a little uneasy. Do I have any bankruptcy or dispute options? Should I try calling this other law office working on behalf of CACH? Do I have to have a court hearing or anything for them to garnish my wages or levy my bank account?
I too am being sued from Cach, LLC i just go the summons paper today at my house , i am afraid , i barely make money . can they sue for a debt of $1,200 that was from best buy ?
I see collection lawsuits for that low and lower all the time.
What is your goal with this account?
Hello Michael Bovee,
I recently sent this information to an attorney’s email provided on his site (Floria Civil Rules Of Procedure) asking him for his yea or nay on my direction. This was just sent yesterday so I have not
ruled out yet whether or not he’ll respond. My question and scenario is in regards to a former civil
suit filed against me for creditor debt owed. Perhaps you might be able to offer your insight on this,
and if so, much appreciated. ~ Here is the situation and what I sent the attorney… ~ ~
I’m in the process of submitting a motion to the 19th Judicial court of Florida
after discovering six years later in 2014 that a default judgment had been filed against me in a
civil debt suit filed in 2007. After sending in my Answer to the suit within the 20 day window, the plaintiff’s counsel acknowledged receipt of my answer in the same month through proper certificate of service. The only response I received from the court thereafter was a notice over 1 year later stating “Order vacating Notice Of lack Of Prosecution”..and it read..that the court finding that ten months had not elapsed since the filing of a pleading in this case…and therefore the notice of lack of prosecution was entered in error, it is thereupon…
ordered and adjudged that this notice is hereby vacated of record and shall be of no further force or effect.
What did this mean?
At the time, I took this notice as meaning that the case had been closed! I never received a summons to
appear for a show cause hearing or any other notices, pleadings, or otherwise to the original suit.
My defense is defective service of judicial process and that any summary or default judgment entered for non appearance should not have been entered in the first place and should be void. As the defendant in the case, I had an inalienable due process right to notice of summary judgment hearing, which I was denied since i did not receive any notice to appear for a show cause hearing.
Pursuant to Florida’s rules of civil procedure rule 1.540(b), I am motioning the court to set aside default judgment.
Please reply Michael with any insight you may have regarding civil process and the route I am to
undertake. I do NOT intend to retain an attorney to file a motion, I will be doing this.
Thank you!
The notice from the court was correcting a prior error it may have made regarding what sounds to be the clerks calendar and docket management efforts. It is common for courts to drop/dismiss cases from their dockets when there is no activity for certain period of time. Many courts will dismiss for lack of prosecution after 12 months or so. Yours appears to jump on this a little earlier than that.
I do not know of too many success voiding judgments when they are that old, and especially when the defendant made at least an initial appearance. The successes I am aware of are not in Florida.
Michael, no luck with settling with Midland on the $6605. They said my account is in recovery and can only settle for 80% or 5284. We can not do this. Our letter says it will go to an attorney on 11/16. Now what? We offered 25% expecting them to counter, but they stuck to their original offer. What do I do?
It says the balance is zero and that it was a CO and purchased by another lender. The original CO balance was $4873 but the balance on the CR is $6605 according to the CR. Not sure why. I do not want to drag payments out forever so I do need to settle for as little as possible so that I can settle on another charge off that is on the CR. First Source has this account but it is not showing on CR yet by them. They did do an inquiry though. I just want to get this behind me and get our finances straight now that I have started to work again. How much should I tell them in negotiating the settlement to get the best offer? Also it is odd that the credit card companies are paid by their insurance companies for defaults so why do they sell the accounts to collect again? Just curious. Seems like double dipping and that it would be illegal.
That means Capital One’s credit report entry of charge off will stay as you see it for up to 7.5 years from when you first missed your payments. Any other credit reporting associated with the account, like a debt collectors, should fall off at the same time. The exception to that would be if sued and a judgment entered in court, which would be a new negative credit report entry as a public record.
Banks do not take out credit card default insurance in the context most of us would think of insurance as.
Ok. The balance is roughly $6605. How much do I offer to settle for? I may be able to come up with some cash but would rather split the settlement over several months. Additionally, I just looked and this account was a GM account that was bought by Capital One and then sent to Midland. I also need help putting a settlement offer in writing. Can you tell me exactly what to say? Do I pay with money orders? Can the collection account be taken off my credit report if I request it and do I try to call Capital One first?
Do I ask them to validate the debt or if it goes legal, do I ask the attorney to validate the debt?
Sorry, but I am clueless on what to do and want to have a paper trail between us and Midland.
Midland Credit Management is part of Encore Capital. which also owns Midland Funding (larger debt buyer). Midland Credit generally collects on purchased debt owned within its family of companies. Calling Capital One about anything from here, other than to confirm they indeed sold the debt to Midland, would not serve a purpose.
I regularly see settlements with Midland between 40 and 60 percent. Negotiating a settlement lower that 40% is doable with hardships that are evident from your credit reports, and when you communicate your financial troubles well. Assume you are able to split the difference and settle for 50%, then are able to split those payments up over 3 to 6 months. How doable does that look to you?
I would encourage you to negotiate the deal over the phone, and get a settlement letter from Midland Credit sent to you prior to payment. You can read more about what to look for in a settlement letter here: https://consumerrecoverynetwork.com/debt-settlement-letters-agreements/.
You can pay Midland using money orders. I like to see folks use the most convenient and traceable methods for settling with debt collectors. I talk about payment methods much more thoroughly here: https://consumerrecoverynetwork.com/paying-your-credit-card-debt-settlements/.
It is unlikely you will be able to negotiated Midland removal from your credit report. Not if it is already on there. But Midland Credit will update your credit reports to show the debt is now resolved and no money is owed. They have to, as that would be the newest and most accurate information about the account. Paid collections lose their credit score sting fairly quickly, and some newer scoring models no longer factor in paid collections. In other words, try not to get hung up on credit reporting.
If your goal is settling, I would not send Midland Credit a debt validation letter, not any attorney it lands with.Not unless you need to buy a few weeks of time in order to raise a bit more money to pay the settlement. It is fairly simple for them to meet the their validation requirement, and with Capital Ones history of providing supporting documentation, save the cost of mail.
Thank you for such great info! I will contact Midland by phone and try to negotiate a settlement with them. I assume they will talk to me as spouse. I intend to share our woes with them and hope they will settle for a minimum of 40%. I hope to pay it over 6 months or if they want cash on the spot maybe they will settle for less. Once settled and reported as paid on the credit report, will Capital One note the charge off as paid also? Again, thank you for your advice!
Just be aware that debt collectors will often see a file that needs longer payment terms as someone who can keep those payments up even longer than you are saying you could/would. And that could (not always) mean they try to hit the higher side of settlement amounts.
The charge off from Capital One is what it is at this point. It should already show zero balance owed if Midland bought it, so nothing to update. Can you confirm that is what you are seeing on your credit reports?
My spouse received a letter from Midland Credit stating he has 2 weeks to pay a debt of 6 grand. If not paid it will go to an attorney in our state. Will they send it to an attorney? I had lost my job and we fell behind. The card was charged off and I assume sold to Midland. We cannot pay this in full and could possibly make arrangements to settle on a payment plan. I think the original creditor is Capital One. I as spouse have just gone back to work. It is going to take us a while to get back on our feet. What do we do?
Debt collectors like Midland Credit cannot threaten suit if there is no intention to follow through with it. I would say the risk of you being sued, if you do nothing, is close to 100%.
Midland Credit is one of the more reasonable debt collectors about setting up payments you can fit into your budget. Let me know if you run into problems with that.
Of course, settling with debt collectors for as much savings as possible is favored over payment plans, but does require upfront cash flow you may not have. Can you pull together 2 to 3 thousand to settle with Midland Credit and get this debt behind you much more quickly?
Hi Michael,
I am so happy to have stumbled upon this website. I have $10000 debt on a Nordstrom Credit Card, $2000 debt on a Wells Fargo Credit card, and $1300 on a TJX Marshalls Store Credit Card. I also have a unsecured loan of $27000 from Kabbage.com which I took for business expenses but the loan payment is divided into 6 months and I can no longer pay for that. I am current on payment for Wells Fargo, and TJX, but I just missed my first payment for the Nordstrom card because I had just signed a contract to https://www.usacredit-solutions.com/ debt solution company to negotiate and get a lump sum settlement for the credit card debts. But after reading about all of this information on your website, I am getting wary and concerned about what to do with my debt and if I can end the contract with the debt solution company because of fear they might not help or worse, take my money and run. Is there a way I can save up a lump sum and settle with my Nordstrom card in 2-3 months and deal with them directly? I just had my first missed payment for Nordstrom and I don’t know what to do next!
Also, for Kabbage, is there any way I can negotiate for that? I don’t know what to do about that. Ive always worked from home on ebay and decided to open an office and took out business loans from Kabbage, but with low sales I can no longer afford the payments. The loans are issued through their bank, Celtic Bank. They are charging my bank account and I am getting overdraft fees because of the automatic payment method they require. I don’t know what to do!
Your advice is greatly appreciated! Thank you so much
You can negotiate and settle with your creditors on your own. Let’s look at the cost and time involved.
What amount of money are you set up to put aside each month with USACredit Solutions? Now… how much can you really save? I ask this way because debt settlement companies generally use a soft sell of monthly affordability payments to make the programs look more affordable. Watch this video for more details on this concern.
If you can access more money for your debt settlement war chest, other than from monthly income, how much, and can you have that extra money at the readu within the next few months?
As far as what you signed up for with USA Credit… what were the sign up fees, how were those paid, and have they already sent any letters to your creditors (which is what their website appears to promote)?
Hi Michael,
I have not made an payments yet but they are asking me to pay $300 a month for their services and I am getting wary about the company and whether they will even help. They have not started sending out letters because a payment has not been made. I just signed the contract yesterday.
If I stop making minimum payments, I can save up $1000-1500 every month to make a settlement payment. But I don’t know how to go from here. I would like to get the largest amount out of the way. My Nordstrom card with$10000. I can hopefully save up $4000-5000 within 3-4 months. Do I just stop making minimum payments and call them before going into stage 2 and work directly with them to settle?
Michael, I have a total of $5,200 in outstanding debt that I neglected for more than seven years. I’ve decided to change my poor financial habits and would like to repair my credit. The debt is a culmination of one credit card, one small student loan, and outstanding unpaid balances for other services. You can already guess I’ve been forwarded to collection agencies. My monthly net income is $2,050 and I have just got around to saving $1,500 that I put to the side. What are the most viable options for me to begin paying down the down while improving my credit? Debt consolidation loans? Also, I have an outright ownership to a home and property with no mortgage on it at the moment and I do live in the home. I’m careful not to create any new debt until I fix the “old” debt. Your advice is greatly appreciated.
The debts being more than 7 years old means they may not be showing on your credit reports now. Can you confirm which of these collections are still showing?
With the exception of perhaps the student loan debt, or any account the ended up as a judgment, you may not want to do anything to resolve these old accounts. You could actually have a difficult time locating the legitimate owners of the debts after this long.
Was that a private student loan, or federal?
When, and who, were the last debt collectors you heard from on each account?
I live in SC and have several credit cards in varying stages of delinquency. I have not been served with any official complaints or judgments. Total debts from all cards is about $3500. I know they cannot garnish my wages. I also know they cannot seize any property as I only own half equity in a home with less than $60,000 equity in total. My concern relates to my bank account. I know bank account garnishment is legal in SC. I work full-time and my employer only offers direct deposit. What type of limits (if any) exist for bank account garnishment? Once I pay my bills each month, I have less than $200 for groceries, food, and gas. The only other deposits include student loans (which I believe are exempt from garnishment). I would appreciate any information and advice.
Once those student funds are mingled with other money, they cannot be differentiated from those other sources. You can fight to get that returned, but it would be better to avoid the hassle.
You cannot have your bank account levied without a judgment. If you are sued for collection, you can navigate that process one at a time, and even avoid a judgment all together by defending, or settling the debts on a priority basis. But you should be ready to change some banking behavior if a judgment is entered.
I have a 3-4 part question
I have a foreclosure from Nov 2010 and I am in the process of repairing my credit?
Will I qualify for a home loan with a previous foreclosure?
I have sent our numerous pay for delete letters to have item removed from my credit report approximately 11…in your experience how long does this process take and how many points will my credit score go up?
The foreclosure is not being reported on my husbands credit; would he qualify as a 1st time home buyer or could we just get a house in his name only?
And last I have 3 judgments that are due to fall off early next year. 2 are from the same plantiff for the same amount of $1084 and the other is for $1368. My question is what do i do about the one being reported as a judgment twice and should i pay the other if its due to come off next year? the two for $1084 the judgment was filed January 2008 and the one for $1368 was filed February 2008. I live in Richmond, va
Yes, you can qualify for a new home loan having had a previous foreclosure. Some general underwriting requirements are that 3 years have passed, so you are a likelier candidate for an FHA style underwritten mortgage loan.
Your pay for delete efforts are probably a waste of time. PFD is not common at all, and with 11 accounts… I would just save the stamps.
What is the nature of each collection account? In other words;
When was last the last payment made?
Who was the original creditor?
Who is collecting now?
I can help you narrow expectations for pay to delete, and settlements in general.
If your husband can qualify for the size of loan you will be looking for based on his income alone, I see no reason not to go for the loan that way. But if you need your income, they will likely pull your credit too.
Can you provide more details as to why the court record would show two judgments for the same debt?
It is common for the judgments to show up on a factual report for underwriting, so just because the judgments would not show on your credit reports, does not mean that they are not visible. It would be a good idea to factor in settling the judgments into your over all plan, and the total costs.
Wachovia last active Nov 2011 reporting now is jeffcapsys
Comcast last active Oct 2010 reporting now is Eastern account system
Medical bill last active august 2012 reporting now is PMAB SRVC
Comcast last active December 2013 reporting now is Eastern account system
T-Mobile last active April 2014 reporting now is enhanced recovery co
City of Richmond utility sometime in 2010 reporting now is ALLIANCEONE
Medical bill last active November 2013 reporting now is capio partners LLC
GMAC sometime in 2010
Verizon 2010 reporting now is AFNI
City of Richmond march 2014 reporting now is Harris Harris LTD
I’m not sure why I have the same judgment from the same company in the same amount
We got a letter from a lawyers office threatening to sue. This is on a credit card debt from a credit union. We are 4 months behind on payments. We had sent the collection agency a debt validation letter and now the collection agency has gotten a lawyer group to send us a copy of the original credit card application. And they threaten to sue. We were wondering if you could tell us of a consumer lawyer in our area? We live in Acadia parish, louisiana.
Thanks
Why did you send a debt a validation letter?
What are your goals with this account?
The answers will help me to locate the right attorney to consult with.
I feel certain this creditor will sue. They are located in lafayette la. I live 20 miles from there. I didnt want to ignore the dunning letter the collection agency sent me. Every advice you read says to send validation letter especially if you feel they are going in the direction of a suit.I am afraid now that I might have started something. I probably shouldnt have sent one.
I am fairly certain they are going to sue to. And I also believe your letter instigated that decision sooner than may have happened otherwise. But don’t kick yourself. Your credit union may be one where your risk of a collection suit was high to begin with (as many are).
I do wish there were less places advising people to send debt validation requests at every turn. For many folks, it is counterproductive to their goal.
I sent you an email with contact details to an experience attorney in Baton Rouge (closest I could find). He should offer a no cost initial consult to discuss options.
You did not answer about your goal for this debt. Being sued by your local credit union is not an easy case to overcome, even with experienced help. Can you pull together money to settle?
If we get sued from this collection agency, we would like advice and help from a lawyer. If this leads to some kind of settlement in the end that would be alright. We dont feel confident in trying to settle this ourselves and feel like an attorney could lead us in the right direction.
With that goal in mind, call the attorney and talk this all through. He would be able to help you settle now, and later.
Thanks Michael! I will call him!
Michael we are so happy because within the next 30 days, a family member will give us money to help settle this debt with the credit union that we are so afraid is going to sue. How much should we settle for?What would they consider reasonable? This debt is 4 months delinquent. The balance is 14,200.
What is the name of the bank?
The credit union is section 705 federal credit union. The collection agency is southwest collection services in lafayette la. Should i call the collection agency or the credit union?
The collection agency is under contract with your credit union. You could start off with a call to the bank, but it should result in them referring you to the collector.
I do not see credit card settlements with small local and regional credit unions go much lower than 50% very often. When settlements are lower, it tends to be from hardship scenarios that result from medical issues, or immediate and long term loss of income. I do also see some great deals get done by folks who are able to relate their financial shortfall well.
If this is your out of pocket expense after insurance they cannot give you a discount it is illegal rebating. Did you use insurance for this care?
Yes. This is after insurance coverage.
How is it possible that they can’t settle is my question? They said that the hospitals will not take settlements at all.
They cannot settle because it is part of the contract with your insurance carrier. You are contractually obligated to pay your out of pocket portion. They are contractually obligated to collect it. If they give you a discount or settle for less after insurance paid based on the contract it is illegal rebating. Carriers have sued providers who give an added discount to subscribers and not the insurance carrier as well.
Legally the hospital cannot settle this account with you for less than you are contractually obligated to pay. Many patients fail to realize that their insurance coverage is a contract between themselves and the carrier as well as the providers who agree to see them under that policy. When the provider bills $1000 for care and the insurance carrier pays $500 based on their contractually guaranteed rate and determines the patient owes 20% or $100 based on their required co-insurance then that is what you have to pay. The hospital cannot decide to settle with you for $50 and not give that same discount to the carrier. Since they have already agreed to a lower rate as part of the contract they are not going to give further discounts or settlements.
I have 2 outstanding debts from 2013 to two different hospitals. It has been turned over to a debt collector. The company is State Collection Service Inc, In Wisconsin. The letter states that it will go to an attorney if not taken care of in 10 days. I have read many of the threads stating these companies may settle if you have a 50% ish lump sum to payoff. The debt is $3200. i just spoke with them and was very cordial with the woman. She stated there was no movement and that all she could do was offer a monthly payment plan of $200. Any recommendations regarding next steps?
Thank You for your help!
I forgot to mention that yes, these are valid debts that have been outstanding for a few years. We have had many many medical bills and these were not able to be paid when received.
Thanks
Is it normal for a collection agency to hold off giving you a settlement/deletion letter and payment received information for 90 days? This is not the original person who had the bill it’s a 3rd party. I’ve asked them several times to send me some kind of letter but they refused until 90 days are up. I settled with them and they ran my credit card for payment. It has already processed but they still refuse. I just want to make sure this is normal. This was a medical collection and they only took off $800 for a $3000 bill and gave me 24hrs. to pay it. Very concerned about their 90 policy because I am trying to buy a home and get the collections corrected.
This collection is from Nationwide Recovery Systems.
I want to be sure that I understand what you did.
Nationwide Recovery called you. You negotiated a reduction on the phone with them. They said the payment needed to be in within 24 hours for them to accept the settlement. You paid them within that time frame. They contend that they cannot send you the agreement, or account paid documentation for 90 days.
Is that correct? And what was the date the payment went through?
Yes that’s all correct. I paid them Sep. 19, 2014. They gave me an authorization # over the phone that same day. The payment went through Sep. 20,2014
When settling, I generally see credit reports updated to show a zero balance owed within 30 to 60 days. But the settlement confirmation letter is rarely 90 days.
Do you have a loan office you are working closely with? Is there a closing date?
Yes. My loan officer is the one that wants the letters. Closing date is set for the 25th of November. It’s enough time but cutting it really close to have this letter they refuse to give me until the 90 days are up.
I am torn between waiting to see what happens in the next 45 days, and filing a complaint with the CFPB (because I know that will lead to Nationwide Recovery having a responsible and reasonable set of eyeballs on your file).
I suppose you could wait 30 to 45 days, and if nothing shows up, get ahead of this and file the complaint with the CFPB.
90 days is an unnecessary delay for credit reporting updates, and for sending you written confirmation.
You will also have an opportunity to dispute the entry with the credit reporting agencies and providing proof of your payments etc. Your loan officer could be useful here submitting your file for rapid rescore.
Hello and any help would be appreciated!
I have spent the last year paying off over 100k in debt and I only have 35k to go! I was very close to bankruptcy but instead started pinching pennies! I have exhausted all avenues of money sources to pay off debt without getting back into any debt. With that said, I have Wells fargo which is 11k credit card debt. Unfortunately, I wasn’t able to get to them with all the other monies being paid to other smaller creditors and now have been sued by them. They are being represented by a collections attorney. I went to my first court date and it bought me about 2 months of time. They didn’t file their bill of particulars on time, I DID file my grounds of defense on time. I have also sent them certified documents trying to settle the debt with NO response from them whatsoever! If they don’t settle with me, I am going to be forced to file bankruptcy since I have NO other options at this point! and I can not afford a wage garnishment, I would lose my house! My question is, Do you think wells fargo would be willing to work with me and settle the debt even though they have hired a lawyer to represent them? If I call wells fargo and explain that the lawyer will not work with me, will they settle with me and have the lawyer drop the case? I know that wells fargo still owns the account, but have hired a lawyer to represent them.
Thank you!
There is little chance of your calling Wells Fargo about how the attorney they are using will not work with you to settle, and have the result in them dropping the case, or work with you directly, rather than through that same attorney.
You can likely still settle, or get them to agree to payments. But that could mean you confess or stipulate to a judgment (the monthly payment route). I cover settling when sued in much more detail here: https://consumerrecoverynetwork.com/question/can-you-negotiate-and-settle-a-credit-card-debt-if-you-are-being-sued/.
Sometimes you can choose which accounts to settle ahead of others in order to lower the risk of being sued, and sometimes this cannot be avoided. Anyone who is going to take more than 12 months to settle all debts should have a realistic expectation that a collection suit could be part of their debt settlement plan.
You settled more than half of the debt already! Before giving up on all you have accomplished, lets look at what you have going on:
What amount of money can you offer to settle in a lump sum in the next 30 to 60 days?
How many settlements deals are you paying on right now? How much are you paying, to whom, and when will those payments stop?
Who is left to settle with other than Wells Fargo?
Thank you for your response. I actually called Wells Fargo and they spoke with their attorney, the attorney is going to send me settlement papers for 50% of the balance. We don’t have any settlement payments out right now and have all other credit cards at zero balances! Some of them have credits on them for over payment! When we settled with bank of america, we paid it in full on the spot. We are about to do the same with Wells Fargo(thanks to finance savvy parents.) We have one more debt to figure out what to do with and then we are done! It’s a big one though 23K! Compared to how much we actually had in the beginning less than one year ago! I guess we are doing good! Now it’s time to get rid of the rest of the debt, and start cleaning up the credit report! I want my 750 score back! Thank you again for your advice! I appreciate any bit of it I can get!
Awesome!
Who is the creditor or collector on the last debt?
I owe $58,000 over several credit cards (GE Bank, Barclay, Citi, First Premier, Discover, etc.). The highest balance is about $8400. I could no longer pay the minimums as of this month as per my income was cut in half. I pay almost $1600 a month in CC payments. I originally got into debt when I lost my job. I am working again, but without the help I was receiving from family, I cannot pay everything. It is a mess!
How long should I wait until I try to reach out to the CC and attempt to settle?
I know I can file for Chap. 13, but there are some dilemmas with that, too, I would like to avoid.
I am terrified of being sued. I have been told most of my balances are “low” so being sued is less likely. My home is protected through Homestead and I am Head of Household.
Signed,
Terrified and Confused
Review the first stage debt settlement section of the site starting here: https://consumerrecoverynetwork.com/what-is-debt-settlement/. Click through to each new article at the end of each piece. You will then know when to make first contact with your creditors, and when you would typically start negotiating with them.
I like settling debts as an alternative to chapter 13, but I am also not a big fan of debt settlement plans that stretch too long. Chapter 13 takes 3 or 5 years. The vast majority of 13’s go 5 years. If you can pull together roughly 26k to settle your 58k of credit card debt, try to do it in 12 to 24 months if possible. How possible is that going to be for you?
You have higher risks of being sued by some creditors over others. You are welcome to post the creditor and balance owed on each credit card. I can then share how I see your list of banks in order of priority to settle with first through last.
It is not true that lower balances will limit whether you are sued. Some banks sue on accounts less than 1k.
Be sure to read the last few critical debt negotiation reports I have listed here: https://consumerrecoverynetwork.com/debt-relief-program-reports/
Thanks so much for your reply. I could come up with maybe $15-18k in two years. Realistically, $26k would be 3ish years away. I am frantically saving every dime right now. Consolidation would be a great answer, too, but unfortunately, from what I have found, you have to have good credit to do that, too. I don’t have bad credit, but the balances have hindered my score…and the late/missed payments should be showing up soon!
Here are the cards/balances my husband and/or I have:
Target Store $132.68
Walmart (Ge) $293.59
Household Bank (Now Capital One) $298.53
First Savings $296.83
First National $348.98
First Premier $399.34
Household Bank (Now Capital One) $405.81
Comenity Bank $427.56
Capital One $458.70
Old Navy (GE) $473.08
Barclay $479.29
Paypal $496.85
Target Visa $498.29
Paypal $599.23
Merrick Bank $1,018.36
Credit One $632.13
Sams Club (GE) $675.79
First Premier $697.44
First Premier $698.38
Amazon Store $698.72
JCpenney (GE) $882.74
Credit One $998.87
Dell Financial $1,069.72
Tires Plus $1,111.82
Citi $1,198.34
Kay Jewelers $1,255.86
Capital One $1,497.82
Capital One $1,511.35
Jcpenney (GE) $1,663.00
Discover $3,999.00
Carecredit (GE) $5,172.26
Citi $5,799.40
Chase $5,994.49
USAA $7,000.30
Barclay $8,399.50
Wow, I am in deep. Thanks for any advice!
More than half of those accounts listed are not good targets for settling. I outline the reasons smaller balance accounts (less than 1k-ish) should be kept out of settlement plans when possible in this report: https://consumerrecoverynetwork.com/credit-card-debt-to-include-in-settlement-plan/. Review that and raise your questions and concerns about the issues in the comments on that page (I ask to do that on that page so others with similar things to consider can learn from the exchange).
I want to help you prioritize your creditors, but that necessitates identifying those that you will settle with, which means the exercise on the other article.
When you work through your monthly budget, what is it you have available to pay all of the unsecured debts you listed? What is the amount you know you can save up each month aggressively in order to settle?
At this very moment, there is about $600-800 to work with AFTER all necessary bills are paid, like electricity and insurance. That is if I pay NO credit cards at all. I may be able to save a little more later in the year as per one debt I am paying ends in Nov. ($75 a month) and electric costs will go down.
I also have about $1000-1500 saved already. Not sure if it is best to use that on the smaller cards, or save it for the bigger cards.
I have talked to a lawyer about bankruptcy. Chap. 13 would be my only option and given some unique circumstances (I will not detail it publicly), he advised me to avoid that if at all possible.
Using the best known concessions available on all accounts in order to repay them working with a credit counseling program, or debt management plan, means coming up with roughly 1100 a month, and without any skepticism for being able to do that for 50-ish months. That means having enough of, and a stable income. Using a combination of savings, and monthly budget for these debts, you can make it maybe 3 to 5 months. That means a part time job, or some other source of income added to the household in order to avoid all of this by gutting out payments.
I want to work with you on the other thread, as this one is more of a catch all. I posted a question to get started on the other post. If you can answer over there, I can offer the next step. I will then have some additional things for you to evaluate and respond to, and then we can get into some of the creative stuff and timelines you should be planning for on your way to settling.
Hi Michael, My husband and I had a timeshare; we spent 6,000 out of 10,000 owed. On vacay in S.C. (we live in PA) they stopped in at our room to say we needed to have our timeshare moved from us to our daughters and to see an estate person downstairs. 7 hours later we signed paper to give us a vacation every year instead of everyother year. We sold the Florida timeshare for a South Carolina timeshare. They were very deceptive because we never saw the estate planner. They kept on changing the numbers on the paper. Needless to say, they put our contract in a backpack we never looked at it and then received a bill from bill me later for 14,000.00 and a 14,000 debt from Wyndham. We were shocked and contacted them to desist. After contacting our district attorney and citing deception in real estate law, they (Wyndham) stopped their account. Bill Me Later stopped invoicing us but we also told them that Wyndham stopped and closed the account. We received a 1099C in the mail. Today someone from SRS tried to contact me. I didn’t answer but called the number later and it was a debt collector. What is your experience with BML? They were clearly deceptive but we signed a contract. We don’t have any savings and I just received my PhD and having school debt to pay. I am really furious with being taken by these scammers. But, we need to know what to do if they contact us again.
Thanks, Hope
Are there any entries of collections regarding any of this on your credit reports? Check your husbands too, post an update, and I can then offer some actionable feedback.https://consumerrecoverynetwork.com/wp-admin/edit-comments.php#comments-form