Discover Card offering settlement?

[stormy]

I received notice from my attorney that Discover card is trying to say that I used their card fraudulently and is threatening that the balance due will survive the bankruptcy if I don't accept their settlement offer.

There was a big purchase in January 2010 then other charges for living expenses such as groceries, gas and clothes. No purchases were put on the card after 5/26/2010 and I filed BK in August.

Is this normal? The Trustee found me to be a no-asset case; I just don't have anything to give them.

They're offering a settlement of $4000; I don't have it, you can't get blood out of a turnip.

Any advice? Should I start worrying?

Sue

[AngelinaCatHub]

Sue, worry not. They would have to go through the trouble of an AP to do this. They are bluffing. Have you had your 341? They had their chance then to gripe, but still can object within the 60 days. But they best have their act together and be prepared to prove fraud. I doubt they will waste the money or time. The letter no doubt is a form letter. 'Hub

[stormy]

My attorney wanted me to explain the charges from September 2009-May 2010 so I did. In January I purchased a sewing machine to replace my worn out 15 year old model; that was the biggest expense put on the card. The rest was basic living expenses; groceries, gas and clothing for me and my daughter.

Thanks for the quick answer Angelina!

[justbroke]

This is a common tactic of certain creditors, that try to get you to pay when you aren't liable to pay. They don't have a case. Instruct your attorney to advise them to proceed if they want, but the charges were outside the 90-day presumption period, and that they were for living expenses.

[tcreegan]

Hi stormy,

When you said "big purchase" I wasn't expecting a sewing machine. I agree with 'Hub and justbroke, they don't have a leg to stand on.

And pursuing an AP in BK court is going to cost them more than what they can recover, ain't gonna happen....

Writing a threatening letter or two costs them pennies and if 1 out of 10 people fall prey to it and send dollars...it is profitable. That is why they do it.

....you can't get blood out of a turnip. This is their job-description!!

Tom in Colo

[ccsjoe]

+1 with everyone else here now that I know what the "big" purchase was. Call their bluff.

[stormy]

The machine I bought was a top of the line sewing/embroidery combo which set me back about $4000. To me that's a big purchase although some of these machines can run much more. I do work full-time but I'm a seamstress in my spare time; I don't charge family or friends for work I do so its not a business. I bought this machine 10 months ago and paid Discover on time, in full payments until I stopped paying my cards in July; the last charge on this card was 5/26/2010. There was never any intention of fraud on my part; I intended to pay my debt but everything just crashed in July.

The rest of the charges that were placed on the card with basic living expenses such as groceries, gas and clothing. Seeing as my Ex-husband was nice enough to keep quite a few of my personal belongings as well as my daughter's I had to replace items such as clothing.

Thanks for all the advice.

Sue

[ccsjoe]

If you made payments to the card post purchase I don't see how they can win an AP; the presumption of fraud or bad faith is making the purchase within 6 months of filing and/or no attempts to repay. You are outside the 6 month window, and presumably made payments on the card post purchase, so....they're likely bluffing. No cc company is going to spend over 5K to file an AP they are not guaranteed to win. Bear in mind if they lose an AP, not only do they lose the 4K, but also their 5K attorney costs AND your 5K attorney costs to defend the AP.