Credit Card Debt Negotiation

I'm currently in a debt consolidation program but it's not helping me at all with my debt. They charge me $40 a month just for their services and my debts are still the same as when I first started the program 6 months ago. Help me please!!

Have you looked into Consumer Credit Counseling services? I'll paste the address here for you. You can read the FAQ page to answer questions you may have about them.

2007-05-03 22:05:30 by gkowal1

www.howtodebtsettlement.com How To Settle Credit Card Debt Yourself www.howtodebtsettlement.com

I currently have over $25,000.00 worth of credit card debt from medical bills due to an auto accident that happened a couple years ago. The accident is going to be settled within the next year since I was not at fault, so I will eventually be able to pay off the debt completely. I have contacted the cc card companies to see if they'll lower my interest rate--no luck.

However, I heard about a company that will negotiate my debt with the cc companies & will lower my debt up to 60% (for a fee, of course). Therefore, my monthly cc payments will go down & I will owe less money overall. The downside is that this will ruin my credit rating & it will take 6 months or so to fix it.

Would it be better to do nothing & wait for the settlement to pay off all the debt at once & not mess with credit rating recovery (I want to purchase a home after the settlement)? Or should I do the debt negotiation & go through the process of rebuilding good credit again?

Thanks!
(Only serious answers please)
By "do nothing", I mean still pay the minimum payment every month, but not negotiate the debt with the company. Sorry about the confusion.
I am not going to file for bankruptcy. From what I've seen, this is the worst option for me (other than not pay even the minimum payments). I've seen that it can take 10 years to establish good credit after a bankruptcy.

Don't wast your money on those rats.

File bankruptcy? Go to the clerk of the court and they will give you everything you need. You can get information about it on the web.

Don't wait it only gets worse, look at all your options.

Any other questions?

2008-05-24 15:24:27 by flowerelena

Price: $19.99

well if you consolidate your loan you would be refinancing the loan, you would be set up tp payoff the loan in 10 or more years and it would be like taking out a new loan. loan negotiation would be just to set up an amount to pay each month until the loan is completely paid, but it would be only if you wanted to increase the payments not to increase the time frame to pay it.
if you consolidate you have more time to payoff the loan, but you will also be paying more on interest.
if you negotiate you loan you will have higher monthly payments but you will payoff the loan faster.

2007-08-08 14:37:26 by PNUT

After a divorce, my debts with credit card companies, especially with new increased minimum payments are unachieveable, and I'm looking for relief - these companies claim that,for a fee, 15% of the negotiated total = typically 50 - 60% of the original balance, they will negotiate with the credit card companies and you pay the lesser amount, something you can afford - are they for real and do they work?

From what I understand, debt settlement companies charge a fee based on the amount they save you. For example, if you have a credit card debt of $22,000 and they negotiate a settlement with your credit card to accept $12,000, then they will charge you a fee based on the $10,000 you saved. If the fee was 20%, then you pay the debt settlement company $2000.

You can negotiate this for yourself. Information is readily available on the web. Check out these sites......

http://www.creditinfocenter.com/
http://credit.about.com/od/debtconsolida tion/ss/debtsettle.htm
http://www.zipdebt.com/

2006-08-31 02:52:26 by clubberz1951

I have accumulated alot of credit card debt over the last 5 years, with it accelerating over the last 1 1/2. About 3 years ago, we got a second mortgage on the house to pay off the debt, and well, it is all back, and more. With the second mortgage, it makes it virtually impossible to pay. Guess we truly lived beyond our means. Our credit isn't shot, as a matter of fact, it is just poor. Right now, I have a 652 and the wife has a 670. We have never, ever missed a payment, however, the minimum payments on over 40,000 in credit cards is more than we can afford.
My income dropped bad last year, and most of the debt piled up trying to "bridge" the gap. Can't really sell the house (housing market sucks, and second mortgage was for 95% at that time) without a short-sale. No fancy vehicles to sell, both our cars are used, with one payment of $310, and other $322.
Anyway, any ideas? Credit cards are currently paid, not late. Don't want to get into a late-fee mess if we can help it. Called the credit card's to try to get the interest rate reduced, or some help with lowering payments, but no dice.
BTW, I do NOT want to do a BK. I was hoping that I could maybe let it go into collections, and then work out a reasonable deal that way, but I was worried that the late-fees and HIGH interest rates would make that too-little, too-late
Just to be clear, I am not wanting to get another credit card. That is what got me into this mess to begin with. I basically was wondering what works better with high credit-card debt. Waiting for charge-off/collections, or trying debt-negotiation. Either way, it will trash my credit, but as of right now, I honestly can say that I don't want any credit anyway!!!!!!!!
Actually Suzi, my wife got me to watch a Dave Ramsey show with her the other day. We sat down, ran our numbers. The problem is we don't have enough income to pay the bills. It isn't like we are blowing our money right now, we already blew it. Now, we are in the position of having 2 upside down cars, basically and upside down house, and credit cards that are making life miserable for us. Yes, we got ourselves into the mess, and we will pay what we can. I do NOT want to do a BK and neither does she. Nobody forced us to use these cards, and I will not try to sidestep them. Besides, I am pretty sure that we make too much money to do a BK anyway, since we would basically be put onto a payment plan anyway. I would rather do it the "right" way, it's just that we don't have enough money right now to do it the "right" way, thus the asking about trying to work out a settlement thru collections or thru debt negotiation.

I have heard your story over and over. People get into debt, go out and get a second mortgage or consolidation loan to pay it off...but then turn around and run up their credit all over again. The next thing you know, you are in twice the amount of debt you started with.

Sound familiar?

Then you realize you are in big trouble, so you try to do the "right thing". You start by contacting the credit card companies to either reduce the principle and/or interest rate. The result is they turn you down...and even INCREASE your rates.

Sound familiar?

Let me show you your future. And forget the Dave and Suzies advice....in most cases it doesn't work.

You can let them go to collections by not paying them. Then they MAY offer to settle for a 25% discount. Will cutting that much from your credit debt help your situation? I'm betting not.

And this will ONLY work if EVERYONE agrees to work with you. That is not going to happen. You will run into the big collection agencies that specialize in making your life miserable. If your cards are over $2000 in debt, you can expect judgments. You say you make too much money now? Wonderful! They will gladly slap garnishments on your income. Can you live with 25% of your wages being garnished?

Like I have said, I've heard this story way too many times. Without carefully examining your financial situation, I couldn't possibly give you any advice. I can say this...debt settlement rarely works. And basically it is the same thing as bankruptcy...except that while you are in settlement your debt continues to grow. They don't freeze your interest or late fees. It's going to take you an awful long time to get out of debt.

I would start by searching out a local non-profit debt COUNSELOR that will go over your finances and work out a very strict budget. Then (if your counselor is any good) they can direct you on the correct path to take. But I'm going to bet that BK is your only real course.

Will you qualify? Probably not for a Chapter 7. But under a Chapter 13 plan you will force your unsecured creditors to 1) freeze the interest and late fees, 2) force them to accept a reduced settlement, and 3) be placed on a payment plan that will get you out of debt within 5 years.

The key to deciding if BK is the way to go is simple. Sit down and create an extremely strict budget. Cancel the cable TV and cell phones. No more entertaining, dining out, or movies. Figure out exactly how much money you have left every month to apply to your debt.

Then contact every one of your creditors and see what sort of deal they will give you. You don't need a debt settlement company to do this...you just need to make sure you tell them that the alternative is you filing bankruptcy. Every one of your creditors must understand that if they don't work with you, it's going to cost them when you file BK. This will get MOST of your creditors to work with you, but not all.

Then crunch the numbers and see if your budget works. Lets say you manage to get all of your creditors to knock 25% of your debt. Now you owe $30k....do you have at least $650 in your budget to apply to your credit card debt?

If your answer is no, you have no real choice but to file for bankruptcy. You can do it now, or you can do it in a couple of years, after your credit has been ruined, you have 2-3 judgments on you, and everybody is harassing you on a daily basis.

Like I've said, I've seen this story many times. I live in an area where factories have been closed, and those still working have seen their huge wages cut. They are forced to live on credit until things improve.....and they never do.

I am not a lawyer or credit counselor, and I am not associated with any of these companies. I'm just someone that everyone seems to come to for advice, and I've done a ton of research. I hope thinks work out for you.

2008-10-09 03:13:45 by kevincap2004