Creditors still want to work things out

[treehugger1]

Every now and then, I get up and decide to make a call or two to creditors who have charged off or are close to charging off accounts.

I spoke to citifinancial this a.m. and they were ecstatic that I called. LOL They are willing to start my payment plan over and get payments down to more reasonable amounts. It appears that they are "now" in a position to discuss options that they would not even consider a month or two ago. I think the national financial mess is bringing some to reconsider how they attempt recovering debt.

I then called BOA. I had two accounts with them. One of the accounts will charge off in a few days. I have not been able to make a payment to them for a 5 months. I offered to restart the original plan in 30 days, but wanted decent payments. They agreed to set up a plan.

The other account charged off and was "sold" to a not so respected national collection agency. I finally got BOA to give me a number for their charge-off/litigation recovery group. Unfortunately, the number is so swamped for their recovery group, that I can't even get though. I doubt that they can bring the debt back in-house, but I've doubted a lot of things these past couple of years, only to discover it is sometimes possible to negotiate with creditors even after they dispose of the debt to outside collections. You do have to have the time available and be willing to keep calling.

I have to think that there might still be hope given the current financial disaster.

As always, dealing with your bad debt is probably better cleaned up with a BK. On the other hand, for those of us who gain little or nothing out of a 100% BK 13 plan, it is possible to try other things.

[GoingDown]

A 100% Chapter 13. Oh, that makes sense now. You are definitely better off trying to negotiate and settle with creditors than filing BK.


I guess there will be no making animal noises on the phone when collectors call for you. You'll have to be serious.

[justbroke]

The only reason to be in a Chapter 13 100% plan, is due to back property taxes and/or mortgage arrearages. Otherwise, I see that a Chapter 13 Plan at 100%, gives creditors their money back FASTER than if you paid the minimum payment... for 20 years.

[treehugger1]

The kicker is that the 13 costs about $3800, and in Oregon the trustee gets 10% which works out to about another $7000. In addition, my student loans go into interest bearing deferment for 5 years, and I get another $30K added on after discharge. The one thing I would gain from a BK is that all the creditors and CA's would have to back off under the automatic stay. I truly think I can pay off all my unsecured (except student loans) in four years.

[DUMBAGAIN]

We don't even own a home. All our debt is loans, medical bills and cc's. The only reason we are considering BK 13 is to avoid lawsuits. But the more I think about it the less that makes sense. I think I could cut some deals with all my creditors, espcially with the current state of the credit crunch. Does anyone know how long it takes for most creditors to sue you?

[All Cash]

Here is the problem with making deals with your creditors. Your resetting the clock for that delinquiency to fall off your credit reports. My suggestion is to make yourself judgment proof and just wait out the statute of limitations for your state.

Side note, student loans are a different animal. My advice on those is to make a scheduled payment plan and stick with it.