How settling my debt has worked for me and what I learned

[flyinbroke]

Yes, BK will nullify a suit. BK is going to be the nuke button in my case. I am stuck in a 13 with a high payback rate and don't even have anything to show for it other than too much education. I decided to ride out things for a bit (I have to wait till the end of the year to file) and hope for the best. I have about 35 accounts and only defaulted on five, which were closed/opted out on so they were unusable anyways.

Of five defaulted CCs, only Citi has offered a settlement in writing (I don't have cash in bulk...taxes are taking any I have). Citi would have not been defaulted on but they ratejacked me, I opted out and the account was closed. BoA disappeared when I asked them to stop calling and only mail/email. GE got mildly aggressive, but I have heard nothing in writing on account 1 when I sent a DV/CD to their CA enforcer, and the second is threatening to send me to a CA. No offers in writing from them.

[moe]

Ok, I guess so far...no encouraging stories.

Citi actually is the one credit card that has never screwed me over. Honestly, it would be hard to default on my payments to them.

It kills me that these banks can borrow at 0% interest though and then charge us exorbitant amounts.

[flyinbroke]

It did hurt me to do that too, Citi was good to me until they ratejacked me and I had to opt out. Once the card was closed, it left me with less credit to work with so I had to free up cash when emergencies sprang up (as they inevitably do.) Unfortunately, "dead" cards came in last on my budget. Thought I would be able to pay them but the math was not working out so reluctantly I threw them into the default pile.

I may try to work with Citi since they offered to settle, but student loans are now coming due and I can't afford to forebear anymore. I paid off 1.2K of my federal one, put it in forebearance and now owe more than when I started. I can't blow them off anymore.

[jwmc1]

Ok, I guess so far...no encouraging stories.

Citi actually is the one credit card that has never screwed me over. Honestly, it would be hard to default on my payments to them.

It kills me that these banks can borrow at 0% interest though and then charge us exorbitant amounts.

What kills me is they got $10's of billions and then still want to sue people that have lost their jobs or had serious medical problems. They make me friggin sick!

[onthebrink]

jwmc1,

First, thanks for sharing this very valuable info. How many months of non-payment on HSBC and Capital One before they filed suit? Also, did you settle with them before going to trial?

I'm curious if you mentioned to them that you were considering BK as a possible option. I have heard that this will make them more likely to settle since they risk not getting anything or very little.

[jwmc1]

jwmc1,

First, thanks for sharing this very valuable info. How many months of non-payment on HSBC and Capital One before they filed suit? Also, did you settle with them before going to trial?

I'm curious if you mentioned to them that you were considering BK as a possible option. I have heard that this will make them more likely to settle since they risk not getting anything or very little.

That's a tough one. I have heard people say that saying you are going to file might slow things down, but others may sue immediately. I chose the option of being coy about it. There are certain things I have said to the attorneys or ca's, I tell them first of all, that I will not permit a suit to go to judgement, that I will answer and I will show up in court. Secondly, I tell them that I am working through the decision process of what to do about my options and that I am in the process of getting input on where I go next. Finally, I let them know that I am will to settle, but that their offers are just too high and there is no way I can do it. If they tell me they are going to consider legal action, I say that's fine, but I refer them to my first point.

The key for me is for them to come to the conclusion that they need to settle for what they can get and that I am on the edge.

I personally think that saying, "I am going to file for bk" may fall flat if you don't and you want to settle.

As far as HSBC, we didn't pay for 6 months and then it went to the law firm, they sent a letter giving me 30 days. I called them a couple of times and we went back and forth, they finally sued us after about 60 days. I started making some payments and then they hit our accounts. HSBC is a son of a b_tch, if you don't pay them they will go after you. I don't know what type of loan you have with them, we had an unsecured loan. They would not settle once they got the judgement, I was finally able to just pay them off.

CapitalOne won't settle for much less than the full balance when it is a smaller amount (less than $2k), but we had a $7,500 card with them that they settled for $3,500.

The bottom line is that you need to figure these people out and talking to them is the only way. From my experience, the best opportunity for a deal with B of A and Citi was when it went to collection right after it left the OC (after about 180 days). Your results may vary.

Good Luck

[paradiddle]

That's a tough one. I have heard people say that saying you are going to file might slow things down, but others may sue immediately. I chose the option of being coy about it. There are certain things I have said to the attorneys or ca's, I tell them first of all, that I will not permit a suit to go to judgement, that I will answer and I will show up in court. Secondly, I tell them that I am working through the decision process of what to do about my options and that I am in the process of getting input on where I go next. Finally, I let them know that I am will to settle, but that their offers are just too high and there is no way I can do it. If they tell me they are going to consider legal action, I say that's fine, but I refer them to my first point.

The key for me is for them to come to the conclusion that they need to settle for what they can get and that I am on the edge.

I personally think that saying, "I am going to file for bk" may fall flat if you don't and you want to settle.

As far as HSBC, we didn't pay for 6 months and then it went to the law firm, they sent a letter giving me 30 days. I called them a couple of times and we went back and forth, they finally sued us after about 60 days. I started making some payments and then they hit our accounts. HSBC is a son of a b_tch, if you don't pay them they will go after you. I don't know what type of loan you have with them, we had an unsecured loan. They would not settle once they got the judgement, I was finally able to just pay them off.

CapitalOne won't settle for much less than the full balance when it is a smaller amount (less than $2k), but we had a $7,500 card with them that they settled for $3,500.

The bottom line is that you need to figure these people out and talking to them is the only way. From my experience, the best opportunity for a deal with B of A and Citi was when it went to collection right after it left the OC (after about 180 days). Your results may vary.

Good Luck

I agree with a lot of what you say. I educated myself from reading posts on this forum and from a meeting I had 18 months ago with a BK atty. The atty told me that the CC's were taking "pennies on the dollar" back then.

I also have previous experience with being charged off in 1991 and advice I received from a credit counselor. At that time the counselor told me to get an unlisted number and do not respond to any mail or phone calls. they all charged me off and 7 years later I had a clean fico. I was already 4 years in at that point and going BK would restart that clock.

This time I played "coy" when I finally decided to start taking calls after 4 1/2 months. I let them tell me what they could do for me. I said there was no way I could pay a dime as I had to pay the mortgage and that I had just got out of the hospital yada yada. So that bypassed any "make a payment" discussion. "They" suggested DS.

I agree with not throwing the threat of going BK. I suggested that I would probably going BK13 if I couldn't get agreement with all CC. I emphasis "suggested". I would kind of mutter it within the conversation if they were coming on strong. Sort of " I got nothing left to lose". I know you should be able to "make them understand" its in there best interests but that don't work. You have to read between the lines as you talk. They same way they are trained to size you up when you talk. I'm good at getting off the subject and asking questions and learning a lot. for example: You guys must be real busy.....wow, you work a lot of hours......

The only concern I had was about wage garnishment but I didn't hear any threats when we talked.

I have just paid #2 of 4 ACH payments in a separate checking acct dedicated to this plan. Owe 82k paying back 17K with BOA.

[jwmc1]

I got off the phone with the law firm representing Capital One today. The guy I was talking to was Mr. Smiley. I told him that I liked his name, and he said, "That is my real name." Like anyone in collections would say their name was Mr. Smiley if it wasn't.

[GRINGO]

How LOng before they sue you

Its been over 1 year, all cc have been charged off, written off, some been bought by debt collection companies. Citi has charged off my account, but they send me a statement every month-why? How long before a suit-all collections companies receive a debt validation letter from me, most never respond back even though its certified-thanks

[rapalapaul]

This is the post i was looking for. I was going to file for bk but after I talked to my free uaw lawyer I was really confused. Then after I found this site I knew i would be screwed if I filled right now. I own a home that I owe 135 thats worth 120 I have a new truck and 60 in cc. The reason I am in this crap is that ten years ago I was young a dumb and bought a double wide i thought at the time it was better than renting WRONG. at 48 grand new with a 418 house note and 355 lot rent. I payed 418 on time for 7 years after 7 years i still owed 43 grand. bought a repoed house plan was to fix it up pull the equity and dump the doublewide. Then the bottom droped my fixed up house droped in vaule and getting rid of the doulble was a feet of god. I tried renting with the parks approvel. 2 renters that paid a couple months than screwed me. I said screw it stoped making payments they called me 20 times a day. i told them look come and get the stupid thing and told them I was going to file. Now that there taking it back I would rather settle my cc and keep my assests. I have citi 20 grand ,boa 17 ,chase 9500,discover 11000 so whats the odds of nocking these down??

[ryan]

.....I have citi 20 grand ,boa 17 ,chase 9500,discover 11000 so whats the odds of nocking these down??

Thats about $58,000 by my rough count...of course it will go up every month its unpaid. So 60plus is right around the corner. (I owe about the same, btw)

While some CC's are said to make good deals, others won;t be so good. I think an overall average of 40% would be pretty good. ...so you might need say, $24,000. to settle 60K.. its just a guess, tho.

[jwmc1]

From my experience, BoA will give you the best deal, then Citi, then Chase, then Discover. Discover is an SOB...almost as bad a Capital One.

[jwmc1]

I have seen a lot of posts lately that might benefit from what I have done. Today, I am nearly debt free.

[IamOld]

Well, I can only tell you my experience. Capital One sued us on both of our accounts that were about $1,200 each. We had a $6,000 Capital One account that I settled for $3,500, so I don't know what would have happened there. From what I have seen at my court, Capital One sues, also HSBC / Beneficial.

I am sure eventually the others would have sued at some point, but I am not seeing that as much. If you can't settle and can't pay you should just file for BK. Get it over with.

HSBC sues - oh yeah.

[IamOld]

I have seen a lot of posts lately that might benefit from what I have done. Today, I am nearly debt free.

well with 20/20 hindsight I'm here because HSBC told me that I was on a payment plan then they said that I wasn't and they sued...right now, I've had a $2K card trying to settle for $1K...oh well...it's too late now...hmm...GE offered to settle over 6k for 3k...oh well...