Anyone use debt collectors?
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Anyone use debt collectors?
My cousin is in need of some financial assistance and would like to consolidate his unsecured debt. Problem is he cant get a big loan because he already owes so much to the credit cards. I cant give any money..Im strapped with house, baby, wife, and cars...My question is has anyone used one of those debt collection agencys that help you reduce the amount u owe..any feed back is great..hes kind of scared to try it..thanks NorCal
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he could stop paying, eventually they will send it to collections, then keep stalling, eventually they will accept 20% or less of what u owe but they wont take it off your credit report till u pay what ever agreed upon ammount, i did that for a 8k check that bounced when i sold sum stuff online :P. paid 2k total back. a year later that is.
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he could stop paying, eventually they will send it to collections, then keep stalling, eventually they will accept 20% or less of what u owe but they wont take it off your credit report till u pay what ever agreed upon ammount, i did that for a 8k check that bounced when i sold sum stuff online :P. paid 2k total back. a year later that is.
See below for Statute of limitations on debt collections in California.If you can last 4 years WITHOUT paying them anything or talking to them (hiding essentially) they can no longer enforce that debt!
ALSO,
California Statutes of Limitation
Written agreements: 4 years, calculated from the date of breach.
Oral agreements: 2 years.
The statute of limitation is stopped only if the debtor makes a payment on the account after the expiration of the applicable limitations period. (in other words, if you don't want to pay them... DO NOT PAY THEM ANYTHING AT ALL! EVER!!)
Last edited by KungFuPanda; 03-09-2009 at 06:01 AM.
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I agree w/Kris
I would NOT use any 'debt settling" agency--
they are essentially taking your money and tell you how to pay your bill.
The best thing for your cousin to do is to call the CREDITOR (NOT..repeat DO NOT CALL the collection agency!!) call the creditor directly and offer them a settlement-- usually you can get away with 40-50% of the original debt..
My question, how much does your cousin owe total? and what does it seem to be comprised of? (revolving accounts (open) such as Credit cards, department store cards, etc... or Installment accounts such as car loans, mortgages, student loans?)
for CC's -- call the companies and settle
for loans -- try to make/keep them current so you can go back and use your 'good faith' as leverage and get them to extend the duration of the loan (thus lowering your monthly payments)...
**another dirty secret that no one will tell you:
Almost all banks/financial institutions WILL take a payment that is less then the minimum payment (and by law, they CAN NOT report you as delinquent if they accepted your payment!) By them accepting your payment, they are acknowledging it as being acceptable. In other words,they have agreed to the new terms and legally edited the terms of the contract to the new payment amount being excepted(granted they've accepted 3 or more payments of the lower amount).. but keep in mind, DO NOT expect to pay 100/month instead of a payment that was suppose to be 850/month! I'd suggest paying at least 50-60% of what the min payment is if your cousin can't afford to make the minimum.
Also, if he has extra money somewhere, start putting more towards the debt with the LOWEST balance on it (by doing so, he will destroy that debt and free up the money originally allocated for it.. then he could take that money and apply it to the next lowest balance and so forth.. repeat that pattern and you'll be debt free in no time. I used this method to pay off over 20K of CC's and loans in conjuction with the settling options.. but once again, DO NOT Settle with a debt collector!! settle directly with your creditor! debt collectors are looking to make AS MUCH MONEY AS POSSIBLE from you b'c that's how much they get paid! I.E. let's say you owe 20,000, the collection agency places will essentially "bid/buy" on your debt and charge a % of whatever they collected from you )
I would NOT use any 'debt settling" agency--
they are essentially taking your money and tell you how to pay your bill.
The best thing for your cousin to do is to call the CREDITOR (NOT..repeat DO NOT CALL the collection agency!!) call the creditor directly and offer them a settlement-- usually you can get away with 40-50% of the original debt..
My question, how much does your cousin owe total? and what does it seem to be comprised of? (revolving accounts (open) such as Credit cards, department store cards, etc... or Installment accounts such as car loans, mortgages, student loans?)
for CC's -- call the companies and settle
for loans -- try to make/keep them current so you can go back and use your 'good faith' as leverage and get them to extend the duration of the loan (thus lowering your monthly payments)...
**another dirty secret that no one will tell you:
Almost all banks/financial institutions WILL take a payment that is less then the minimum payment (and by law, they CAN NOT report you as delinquent if they accepted your payment!) By them accepting your payment, they are acknowledging it as being acceptable. In other words,they have agreed to the new terms and legally edited the terms of the contract to the new payment amount being excepted(granted they've accepted 3 or more payments of the lower amount).. but keep in mind, DO NOT expect to pay 100/month instead of a payment that was suppose to be 850/month! I'd suggest paying at least 50-60% of what the min payment is if your cousin can't afford to make the minimum.
Also, if he has extra money somewhere, start putting more towards the debt with the LOWEST balance on it (by doing so, he will destroy that debt and free up the money originally allocated for it.. then he could take that money and apply it to the next lowest balance and so forth.. repeat that pattern and you'll be debt free in no time. I used this method to pay off over 20K of CC's and loans in conjuction with the settling options.. but once again, DO NOT Settle with a debt collector!! settle directly with your creditor! debt collectors are looking to make AS MUCH MONEY AS POSSIBLE from you b'c that's how much they get paid! I.E. let's say you owe 20,000, the collection agency places will essentially "bid/buy" on your debt and charge a % of whatever they collected from you )
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Your right about settling, but it will ONLY affect your credit report for up to 8 years max. after that, statue of limitations has run it's course.
See below for Statute of limitations on debt collections in California.If you can last 4 years WITHOUT paying them anything or talking to them (hiding essentially) they can no longer enforce that debt!
ALSO,
California Statutes of Limitation
Written agreements: 4 years, calculated from the date of breach.
Oral agreements: 2 years.
The statute of limitation is stopped only if the debtor makes a payment on the account after the expiration of the applicable limitations period. (in other words, if you don't want to pay them... DO NOT PAY THEM ANYTHING AT ALL! EVER!!)
See below for Statute of limitations on debt collections in California.If you can last 4 years WITHOUT paying them anything or talking to them (hiding essentially) they can no longer enforce that debt!
ALSO,
California Statutes of Limitation
Written agreements: 4 years, calculated from the date of breach.
Oral agreements: 2 years.
The statute of limitation is stopped only if the debtor makes a payment on the account after the expiration of the applicable limitations period. (in other words, if you don't want to pay them... DO NOT PAY THEM ANYTHING AT ALL! EVER!!)
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