Question about credit card debt

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Here's the story in a nutshell, I have started seeing someone the last few months and they have a mountain of CC debt.

Has anyone used any of the CC debt services available? They seem to good to be true.
 

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I have looked into a few of them years ago.

here is what many of them do: Claim that you will only have to pay pennies on the dollar for your CC debt, give you an unrealistic number like you will only have to pay 40% of your debt. The way they do it however, is that you pay the company monthly installments for a while and NO money goes to the credit card companies, making your credit horrible and the theory is that eventually the credit card companies will want some of your money so they are willing to settle. This is only a hypothesis by the CC debt services and most of the time people get into much more trouble than they already were. They end up with even more debt than they started, because there are no guarantees.

If you ask me, use a service like Lutheran Social Services, get on a debt management plan so that there is an agreement between you and a cc company to get out of the debt, and you need an organization like LSS to faciliate the whole thing.
 

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Like any other problems, there is no easy way out. These credit card counseling companies feed off of desparate nieve people. Talk to the credit card companies on your own and work out something.
 

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I am in same situation, sort of. Except i have a baby with my girl and we are getting married soon. She has 1 credit card for $4000 for a cruise she went on like 10 years ago!!! Un-fing-believable! It gets better, the interest rate is 32%!!! 32%!!! Is that even legal? I think I am going to get my own card and transfer the balance to a 0% 1 year deal. Anyone have any experience doing this? I have never had a credit card.
 

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If your debt is high enough and you are in position to claim a bankruptcy, get a good lawer and file. If it was good enough for Trump, it's ok for you.

At the rate of interest these banks charge, it serves them right.
 

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Plato:
Agree. Hey Thomas Jefferson did it three times. He still had a pretty positive effect on world! With their outrageous fees for everything and shortened pay windows the last thing credit card companies want you to do is pay on time(other than bankruptcy, even under the new rules they got their GOP lackies to pass).
 

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Do not use the credit repair people. They will not help you.

Either pay the cards or file bankruptcy.

Sean
 

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I worked for MBNA as a Manager so I know a few things about CC. You can do two things.

1) Call up customer service and ask for collections department. Don't bother with regular customer service they cant help. They only act like they can. Waste of time. Collections reps have different options on their screens and can mess with numbers. You can def work out a deal with them but you have to be stern and understand the consquences. If you take this method, your credit will be fucked. Your future cc interest rates, if you get any other offers, will be high as shit. I think 23.99% + prime which is close to 32% (if your lucky).

2) Cut the fucken card. Pay the debt. Dont just pay min. balance. Never pay min balance. Always pay at least 3 times the amount. Slowly but surely the debt will go down.

Let me know if you need more help.
 

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Transfer it to a 0% apr and pay down...(under your name)

in no way should people be paying interest on credit cards nowadays...
 

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CapNCash said:
I am in same situation, sort of. Except i have a baby with my girl and we are getting married soon. She has 1 credit card for $4000 for a cruise she went on like 10 years ago!!! Un-fing-believable! It gets better, the interest rate is 32%!!! 32%!!! Is that even legal? I think I am going to get my own card and transfer the balance to a 0% 1 year deal. Anyone have any experience doing this? I have never had a credit card.


You can transfer the amount to your cc but the rate depends on your credit history. Since you never had a cc, this might be a lil problematic. Do you have mortage or car payment? What I would recommend is call up a cc company and wheel and deal. Tell them you want to open an account and transfer X amount of dollars. Ask them what is the lowest rate they can give it to you for, how long, any additional fees, etc?

Most cc will offer 0% for 6 months or 5.99% for life of the transfer. But you have to becareful. After the promo of 0% is up, your interest rate might jump as high as 23.99% pending your credit. If you can pay everything off in 6 months, go with 0%. If not, 5.99%.
 

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CapNCash said:
I am in same situation, sort of. Except i have a baby with my girl and we are getting married soon. She has 1 credit card for $4000 for a cruise she went on like 10 years ago!!! Un-fing-believable! It gets better, the interest rate is 32%!!! 32%!!! Is that even legal? I think I am going to get my own card and transfer the balance to a 0% 1 year deal. Anyone have any experience doing this? I have never had a credit card.

I've been flippin debt for years, it's very effective. However, if you never had a CC, the companies may not be inclined to give you one with any sort of useful limit. One of the biggest things that hits your credit score is not having any credit in the first place.

Good luck man
 

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has anyone ever tried those CC debt illimination companies? They claim a 95% success rate and will completely illiminate your credit card debt. I get spammed by these types of people all the time
 

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Take it from me find someone else who has more money than you and live happily ever after. But if you have to keep the broke chick don't use one of those services they will rob you blind.
 

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Do not work out a deal with the card company.
Do not work with a repair company.

Both of the above leave you with shitty credit.

You have 3 good choices:

1. Pay it off (Get a lower rate balance transfer or loan if possible)
2. Simply default.
3. Declare bankruptcy.

If you take 2, your credit will be as bad as if you work out a deal, but you will save dollars.

Sean
 

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sean1 said:
Do not work out a deal with the card company.
Do not work with a repair company.

Both of the above leave you with shitty credit.

You have 3 good choices:

1. Pay it off (Get a lower rate balance transfer or loan if possible)
2. Simply default.
3. Declare bankruptcy.

If you take 2, your credit will be as bad as if you work out a deal, but you will save dollars.

Sean


I think you're wrong, and I am curious how you can be so matter-of-factly with a topic like credit. The truth is, if you work with a reputable agency (like lutheran social services as I mentioned above), you may have a short-term hit to your credit but in the long run everything will be restored to normal because you have actually paid off your debt which obviously looks much better than defaulting or declaring bankruptcy.
 

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Intruder said:
Here's the story in a nutshell, I have started seeing someone the last few months and they have a mountain of CC debt.

How much is a "mountain" of credit card debt? There are some good credit repair places. The real ones don't charge an upfront. A friend of mine had over 40k in credit card debt. The CPA(credit guy was a CPA) charged $100 to set up an account, $50 to remove a derrogatory item from the credit report and $100 to negotiate a settlement. The settlements were usually around 50%.

I used this CPA to remove a few items(late payments). The $50 fee was per credit report. He warned me that sometimes they come back on and if that happened he would remove it again for free. Once, he was unable to get something removed.

As someone else in this thread mentioned, this is a process and it destroys your credit. Your friend is looking at years by going this route, but if its a large sum and won't be paid down anyway, he/she probably can't use the credit right now anyway.

From my understanding, the way it used to work, the original creditor would sell the debt to a third party for a certain percentage. This would continue if this third party didn't believe they had a high chance of collecting. My friend had an account that was sold over 5 times. This process will not even begin until he/she stops paying the card.

THE ABOVE WILL WRECK HIS/HER CREDIT and may not be as easy as in the past(My friend's situation was 8 years ago) due to the change in bankruptcy laws. The above is also only possible if there are no assets.

There are so many variables, but if your idea of a mountain is something this person can't possibly pay and has no assets, what I described above isn't a plan, but merely an unfortunate inevitability.

Lastly, you may want to check on your state's statutes. Just recently, my wife saw something on 60 minutes(or one of those shows). Turns out items don't drop from your credit for 7 years, but in Florida, if you haven't paid a creditor in 5 years (if even 1 penny is paid at any time, the counter is reset) the debt is no longer "owed". You can still pay it and the creditor can still attempt to collect, but no judgement can be filed. Also if you write a letter explaining the debt has exceeded the statutes of limitations per your state laws they must cease collection attempts against you. The link below will take you to the article. There is a link to a chart in the article.

http://www.bankrate.com/wpbf/news/cc/20040116a2.asp?caret=2

Please understand, I'm not advocating not paying or telling you there are "easy" ways out. If he/she can pay the debt, do it. If he/she can transfer it to a 0% card or low interest card, do it. If he/she needs YOU to transfer it to one of your 0% cards, DON'T DO IT. I wouldn't do it for my wife. There is no reason to ruin two credits over one mistake. If there are no assets, what I mentioned above WILL happen. Then the creditors/collection agencies will not only accept a reduction in principal, they will offer it. If there are assets, pay the debt. Oh, and WHEN the collectors start getting nasty by contacting his/her employment or saying nasty thing at home, simply send a registered return receipt letter stating they are only to contact you in writing.
 

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GameBreaker said:
I think you're wrong, and I am curious how you can be so matter-of-factly with a topic like credit. The truth is, if you work with a reputable agency (like lutheran social services as I mentioned above), you may have a short-term hit to your credit but in the long run everything will be restored to normal because you have actually paid off your debt which obviously looks much better than defaulting or declaring bankruptcy.

If you default and then have the item removed later, it didn't happen anyway. Also, sometimes, in the terms of the settlement, you can have the item removed.
 

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