Robo Shobo

Credit card debt relief has become a top priority for many Americans. Gone are the days of holding multiple accounts with high balance limits. Consumers have grown weary of paying the minimum balance which covers little more than interest rates.

It can be obtained in various ways. Many people are turning to debt settlement companies that offer the promise of slashing credit card balances by half or more. While it is true debt settlement can reduce outstanding balances, consumers often spend as much money settling debts as they would paying off creditors directly.

Debt settlement companies charge a startup fee and monthly maintenance fee. These fees often amount to nearly half the amount of negotiated debt. For example, if consumers owe $10,000 in credit card debt and the debt settlement company negotiates the balance to $5,000; consumers would save 50-percent. However, the cost to obtain the savings could range from $2,500 to $5,000; resulting in little to no savings at all.

This is not to say that consumers should not investigate the option of debt settlement. Some companies use a sliding scale which bases fees on earned income. Others assess fees based on a percentage of reduced balances. Prior to entering into an agreement with debt settlement companies, consumers should visit ConsumerFed.org to review other alternatives which may provide the same, if not better, results.

Consumers who are drowning in debt often turn to credit card bankruptcy. This debt relief option often causes more harm than good. First of all, it is expensive to file bankruptcy. Filing fees and legal expenses can cost debtors $2,500 or more.

Many people believe that filing bankruptcy will wipe out debts and provide them with a clean financial slate. The truth of the matter is new bankruptcy laws were enacted in 2005. The Bankruptcy Abuse Prevention and Consumer Protection Act require debtors to repay a portion of debts under Chapter 13 bankruptcy.

Debtors are required to undergo the ‘means’ test to determine the amount of debt to be repaid. The means test compares debtors’ income to their states’ median income. Those who earn the same or more than the median income are required to establish Chapter 13 payments. Creditor payments are submitted to the bankruptcy Trustee who distributes payments to creditors until debts are fully repaid.

Chapter 13 payments are in addition to normal monthly expenses. If debtors are financially incapable of contributing funds, creditors have the right to request the bankruptcy petition be dismissed. When this occurs, debtors fail out of bankruptcy and no longer have protection from the court.

Individuals who file for bankruptcy protection are required to obtain credit counseling through an approved U.S. Trustee agency. Consumers with excessive credit card debt should consider obtaining credit counseling prior to submitting a bankruptcy petition.

Most credit counseling agencies are well-connected within the credit industry. Credit counselors can often help consumers negotiate outstanding debt by obtaining a reduced rate of interest or reducing the amount owed.

Consumers should obtain credit counseling through an agency approved by the U.S. Trustee Program. If credit counseling does not provide required results, consumers can move forward with their bankruptcy petition and will have met credit counseling requirements of the court. A list of approved credit counselors is presented at USDOJ.gov.

Debtors who own real estate with accrued home equity might be able to obtain credit card debt relief by obtaining a home equity loan. Mortgage loans are assessed a much lower rate of interest than credit cards. Using a home equity loan to pay off credit card debt can save debtors a considerable amount of money, but also places their home at risk for foreclosure if they default on loan payments.

Conquering debt requires time, commitment, and a solid get out of debt plan. Debtors should explore all available options including budgeting, credit counseling, debt consolidation, debt settlement, and credit card bankruptcy to determine which strategy can help them reach their financial goals without completely destroying their credit rating.…

After my divorce I had two accounts with HouseHold Bank. Each credit card had a credit limit of $1500.00. They were both a few hundred dollars from max. I recieved a letter from HouseHold Bank that due to the economic climate my interest rate on both was going from 13.99% to 24.99%. I called them immediatly and tryed to get them to lower the rate and they told me that it could not be done because of the economy.

I scrambled and in a few months I paid off the one card. I waited to see a statement showing me the zero balance on that account. Then I called Household Bank to cancel that credit card. I told them that I wanted to cancel the card because the rate was too high and due to the economic climate I could no longer afford to use the card. What they did was convince me to combine both cards together into one account and they would lower my interest rate back to 9.98%. They said that I will be recieving notice of this in one week. I will believe it when I see it.…

To all the blog readers,

I am a new member to this wedsite.I am trying to keep up on all the bills. My question is how do I go about paying my balances down and still have money to live? I was unemployed for awhile about (4 years ago) and in order not to go belly up I used my credit cards and my line of credit to live. I was unemployed for about 6 months and have wife and 3 kids. The kids wouldn’t understand about when all that happen.I am from time to time robbing peter to pay paul and this can’t keep up. I need to relaese the some tension.

We always pay our mortgage/rent first.? Then car payments and utilities in that order? Try to call your credit card companies and negotiate a lower rate.? I put my cards in order of highest interest rate.? Any money extra goes to? that card.? Yard sales, rebates checks etc to that card.? I’m paying of the second one this month.? I have one more before my highest interest rate card.? I took an extra job watching my sister in laws son to use to pay of cards.? If you have friends who work see if you can find someone who needs to get to work early and offer to put their kids on the bus. I only charge a little big so it saves her money and she works. That money is extra for me. Best of luck!

It really depends on your situation. If your main problem is credit card debt, I would call and try to renegotiate your terms. Do NOT talk to the person who answers the phone–they can’t do anything for you. Ask to speak to a supervisor. Some CC companies train their phone support people to quiz you about *why* you want to speak to a supervisor and try to not play that game. I have found this answer to be very helpful: “Oh, it has absolutely nothing to do with you at all. However, last time I called in, I was treated very rudely (blah blah blah) and I really need to speak to a supervisor.”

If that doesn’t work, keep responding with, “I need to speak with a supervisor” and once I even had to tell them that I was recording the call and my lawyer would be in touch with them if they didn’t get me a supervisor.

If they won’t negotiate your interest rate, Suze Orman has recently said that if you quit paying for a few months, they will be more than happy to negotiate with you after that. I’d do that as a last resort, though because you are going to accrue some nasty late fees and quite possibly wind up with a higher percentage rate than what you’ve already got.…

First, this is not hopeless. My question at this point is, why not go back to the original bankruptcy attorney you spoke with who told you to wait until 2009. 2 years returns would only include 09 and 08 (usually, even if you were not required to file in 09); not to say everything is totally in the clear and above board, because you may have some “look back period” issues (check that out on the net). (Unfortunately, I’ve done a lot of research of my own 🙂

Do NOT touch that 401k it may be (very likely is) protected from creditors and keep your money out of bank accounts (even though a good attorney can likely force them to return any money taken as it is probably also “protected” by the simple fact that it is social security payments). The initial $50 taken prior you can just chalk up to par for the course and thank God it wasn’t any more of your much needed money.

Seriously consider going back to that attorney who told you to wait until 09, it sounds like he had a good plan for you to follow and he made you feel better; if not that attorney another bankruptcy attorney. Bankruptcy sucks at first, but has been ingrained in our system for us little people to get a fresh start which it sounds like you really need right now.

Hope you feel a little better, your situation is not hopeless or unheard of. Social Security takes 4EVER to finally get processed, but again, thank God its there for those who need it. Just wanted to reiterate how important it is to get some help from a good attorney. Every state is sooo very different in how they treat our homes, our bank accounts, just about everything is different (enough to drive a sane person crazy). Even though I have had family go through bankruptcy I am no way an expert, and I live in a different state than you, so…. most of what I had to learn probably only pertained to my area.

I’m not meaning to tell you what to do or give you legal answers. Anyway, jsut wanted to put that out there, cause I’m not a lawyer nor woul I wanna be one.…

The best help I could offer is to go to your local library and check out the book, The Total Money Makeover by Dave Ramsey. They cannot garnish SSI or seize it from your bank. But your bank needs to know this and care. You need to find a small bank who will pay attention.

You are basically judgement proof as far as the credit cards. They will be jerks and bullies, but in truth they cannot get a dime out of you, with or without bankruptcy. They can’t take disability payments. They can’t go get money from another creditor just because you paid them first. They can try…. Or threaten… Because they are morons. But they can’t do it.

Read the book, do lots of research on your rights, and let the fear go away. You will be much better able to make good decisions without fear. It is my understanding that even filing bankruptcy, the 401k is safe. They can’t touch it. If you sell the house, the liens will be paid off. I do understand the feeling of being stuck with “can’t sell the house” and “rent is the same or more than the mortgage payments”. It will be tough to rent anything with your current financial picture, from the way you stated things.…

The credit card companies (or in some cases the companies they sold the debt to) have all gotten judgments against me, and most have liens on my home, though I have no intention of selling.

Finally in 2008, my bank account was seized even though I only had $50 in it. Realizing at that point that the likelihod that I can ever pay down this debt, which has grown at an alarming rate, was nil, I met with a bankruptcy attorney and was told I was a perfect candidate for chapter 7 bankruptcy, and that I could keep my home and the liens could even be removed. Even though I’d not wanted to go that route, I was so relieved that this financial stress could finally be over–it was the first time I felt like I could really look forward to a future with a little peace and felt energized for the first time in years. I hadn’t even realized just how much this financial mess had effected every area of my life and potential recovery until then.

Then, the attorney told me that because I would have to provide the previous year’s tax return to the bankruptcy trustee, and that my 2007 return showed the sale of the stocks, I would have to wait until January of 2009 to file so the sale of the stocks and distribution of the cash would not come to the attention of the trustee. Come January of 2009, I met with a second attorney who told me that the trustee will sometimes ask for TWO years tax returns, and that if they did, they would of course see the sale of the stocks and would learn of the transfer of funds to my sister and two friends, and that it was possible that the trustee would not only question them, but could try to recover the monies I distributed to them.

I happen to know that in the case of my sister and one friend, they no longer have the original sums I transferred to them as the one friend used a substantial amount to upgrade her home, and my sister used most of hers to pay for her divorce. I advised the attorney that the trustee would not be able to recover all that money, but more importantly that I absolutely could not take a chance that the trustee could cause trouble for these people who have been very good to me, and I now don’t know what to do to try to move forward with my life and get this financial mess behind me

My monthly Disability check barely covers my monthly expenses and I am always behind in everything besides my mortgage which I’m careful to pay on time. I cannot consider selling the house because I’ve learned it will be impossible to get another mortgage or even rent an apartment because of my destroyed credit. Further, my mortgage payments are similar to what a rent payment would be in my area.

I recently contacted the creditor to whom I owe the most ($28k, even though the original debt was $14k). It’s one of those companies that purchased the original debt from the credit card company and has used aggressive tactics to try to collect from me. They advised me that thousands of dollars in additional attorney’s fees were going to be added to the judgment/lien amount and that unless I could come up with $17k immediately, they would not settle.

My house, which is in New York state, is in terrible disrepair, which is why it appraised low enough for me to stay within the state’s $50k equity exemption in order to qualify for the bankruptcy. My nephew, a contractor, has offered to get my house up to par free of charge, which I have put off in order to keep the value low until I know for sure whether I’m going to try to file for bakruptcy.

I just don’t know what to do to resolve this, and am just very confused now. The stress of watching the debt grow and grow has made me ill and unable to function well. I have opened a new bank account but am in constant fear that it will be seized. I have to cash my Disability checks at a check-cashing business to keep money out of my account. I don’t know how much longer I can continue to live like this. I do have $20k in a 401k, which would not be enough money to settle these accounts, and in attending Debtors Anonymous meetings have been urged to not touch the money in that 401k.

Does anyone have any ideas on other options I may have? I am sick over this and feel trapped.

Again, I apologize for the length of this post, but I didn’t know what I could omit and still give the big picture.

Blessings to all.…

but I’ll give it anyway. File your taxes now. Then track down that statement (call BOA). File an amended return (very easy). (If your interest payments are ~$600/month [you should have some idea what they were] x 3 then your “income” would be reduced by ~$1800.

Your tax bill would be reduced by xx% of that $1800 [whatever your tax rate is]. Could be anywhere between $180 and $400. I think that is worth the two hours work tracking down your interest and filing an amended return.…

Hello to the kind members of this very helpful blog!

Please forgive me for making this so long, but my situation is complicated and I would appreciate any advice. It’s gotten terribly confusing and I don’t have a clue what I should do next, and am really in a state of terrible despair.

I’m a 46-year-old single man. In 2003, I became disabled and stopped working and had no income. I used my savings to pay credit card bills and my mortgage until my savings ran out. Although I was approved for Social Security Disability in 2003, I didn’t receive the first payment until 2005, and therefore paid minimal amounts toward my debt during those two years, and all my credit accounts went to collections and my house into foreclosure.

I contacted my creditors who weren’t willing to do anything to help me save my credit. I simply stopped paying all bills as I had zero income. I had about $50k in credit card debt before becoming disabled, aside from considerable personal loans I’d taken years earlier from my sister and two friends who had been waiting patiently for me to pay them back. As my credit score is poor I want to apply for $1000 dollar loan no credit check just to get some money for my regular expenses. Do you think it’s a good idea?

Upon becoming disabled, I stopped using credit and have lived on a cash-only basis, and I have not debted since 2003. I’d never expected my ability to generate income would come to a halt like that, and never imagined I would not be able to pay off all of this debt.

In 2005, I received a large Disability check for a retroactive amount back to 2003, which enabled me to get my mortgage paid up-to-date and get my house out of foreclosure, and I have remained current on that account since.

I tried to make payment arrangements with my other creditors (about 7 credit card companies), and succeeded in only two of the cases and made payments for about 2 years, though the balances continued to grow rather than show a reduction. I would have qualified for bankruptcy but felt it was not a route I wanted to go.

Also in 2005, my father died and I inherited stocks worth about $100k. Since my Disability payments were not enough to live on, I lived partly off the dividends of the stocks, and began paying down the debts to my sister and two friends. I had a consult with an attorney who was familiar with Debtors Anonymous who told me that because that inheritance was essentially my retirement account since I was disabled and might not work again, I should not use it to pay off any credit card debt, which had nearly doubled due to attorney’s fees and penalties etc.

In 2007, realizing that the situation seemed hopeless and my stress level was extremely high, I retained an attorney to try to settle with my creditors. He said that it was only a matter of time before my creditors found and seized the stock account, and recommended I sell the stocks immediately and that since I owed so much on personal loans from family and friends, I satisfy those loans first, which I did. With what little money remained, I did settle one debt, and fixed various long-standing problems with my home, and sadly no longer have a single penny of that stock money. Although I do have an offer from another family member to pay some of the debt if I were able to settle, the attorney did not succeed in obtaining settlements with any of the creditors besides that one.…

Since the mortgage was sold to Nationstar last March, I can no longer access my BOA mortgage. It doesn’t even show up in the list of accounts… I’m guessing that had I thought about it a year ago I could have done it. But it’s too late now.…

Can’t find my interest statement for what I paid to BOA mortgage for the first 3 months of 2013, so I’ll just miss that deduction on 2013 taxes.

I’ll file those today. Have most of the paperwork to send to Churchill for the re-finance BEF back at $1000(finally!)…

All of our small medical bills are now taken care of. The hospital is paid, the dentist is paid. We’re fixing our credit and I had a sixty dollar item on my credit report I just found out about, supposedly from a cardiologist I saw when I was pregnant. I was suspect since that amount wouldn’t match my copays. I called the creditor since I hadn’t gotten the bill.

The debt collector couldn’t find my account for a long time, and when she did, she said the cardiologist had retracted it as an error. They said they had pulled it back from my report, but there it sat, in delinquent accounts. Submitted a dispute and within 24 hours, it’s gone. I know it shouldn’t matter I the long term, but I need to clean this stuff up if we will ever be able to refinance.

And just a quick story to indicate mortgage companies complete incompetence: this week, in this order, we received three pieces of mail: our final approved mortgage modification paperwork to just sign and return; a letter saying we were missing required paperwork; and an initial application for a mortgage modification. Um….messed up.…

I only have 1 credit card which was unwilling to work with me a few months ago. They were actually pretty rude about it too, so they went to the bottom of the list.

I’ve made payments every month, but in their world, I have a “past due” of $485, $385 of which is late fees, which they are unwilling to waive.
They just called again. Nicer person, but still the same position.

And I’m like, well guess what? My position hasn’t changed either. I’ll still send you $100 a month, and hopefully someday it will be all better 🙂
you just gotta laugh. if it wasn’t for the creditors, my phone would never ring 😉…

The only thing I could find out about them is that a lot of people weren’t aware of the buy-out “in time” to get their first payment in, and it wasn’t credited and they had rolling late fees.

I also read that they were really bad about crediting your payment a few days later so you’d have late fees, so I set my Capital One 360 to pay them on the 25th (due on 1st) and I’ve never had a late fee. …

I have to wonder because I have been going around and around with the company I ordered some embossing folders and dies from nearly a month ago about the amount of refunds they are giving me on out of stock items. The amount differences are not large at all, less than a dollar, but when they become more and more items those pennies add up and if they are doing it to me who else are they doing it to.

Here’s the math. I paid $1.25 each for these items, and had a 25% discount on my total due to a promo code. I also paid shipping for the items.
They are refunding me $.64 and have for the last 3 weeks have sworn up and down first that the difference was 25%, then 30%, then 25%, they a combo of the two. Only I only got the 25% off my original order. Anyway you look at it they are only refunding me a little more than 50%.

I finally got someone with some basic math knowledge today and he kept saying “what the?” every time and every way he did the math. Then when I asked how many other people this had been done to and how big of trouble they were going to be in he said “a lot, and we need to find out where that other $.30 went for each of those items “

Someone in their warehouse is now in deep dog doo-doo. Because they were recording they were giving store credit for the other $.30, but they hadn’t …to anyone. Why does the superman movie come to mind where the guy was putting all those little half cent differences on calculating stuff into his own account? This is not a small company.

So now not only do I have my full refund, supposedly, I will follow up on it. I have additional store credit and some free items headed my way. To thank me for bringing it to their attention.

I know $.30 isn’t much, but it was more than one, and how many other people got hit that way?…