Defaulted Credit Card Debt

gary71 · #1 11-12-2008, 04:00 PM

My question involves collection proceedings in the State of: Georgia

Okay here's my story. I was already in financial troubles earlier this year. Went for 4 months without making a payment on the credit card. Then 2 months ago I get laid off. In the last 3 months I was making payments to Discover at $200 a month. Now I find out they charged off my debt. And I now have Redline calling me. They tell me that IF I will pay $500 this month, then $200 for the next 3 months that they will "work" with me. BUT....they insist that I post date checks and they will do an automatic draw out of my account. I do not want it set up like that. They say unless I do this there is really nothing they can do. I asked okay, can I mail the $500 this month. THen write checks for the remaining months? They said no, that does not show my willingness or consistency on paying the debt.

What should I do? I told them that unemployment pays little to nothing. I mean I get the max in GA. which is $330 per week. But still, with a truck note, utilities and mortgage. Nothing is left over.

I have always heard that if I am paying something per month that there is little they can do. But I am affraid of them sueing etc. I mean, I really having nothing for them to take if truth be known. But I am really worried about this. And Discover had told me that as long as I paid $200 per month that my account would be current.

Actually Redline was wanting 10% of the debt now, that is until I told them that I was laid off.

Sorry for the long winded post, but I worried and confused as to what to do. I have thought about filing bankruptcy but REALLY hate to have to do that. I had an almost perfect credit score prior to having to take a new job and move!

OhMy · #2 11-12-2008, 05:42 PM

Quoting gary71

My question involves collection proceedings in the State of: Georgia

Okay here's my story. I was already in financial troubles earlier this year. Went for 4 months without making a payment on the credit card. Then 2 months ago I get laid off. In the last 3 months I was making payments to Discover at $200 a month. Now I find out they charged off my debt. And I now have Redline calling me. They tell me that IF I will pay $500 this month, then $200 for the next 3 months that they will "work" with me. BUT....they insist that I post date checks and they will do an automatic draw out of my account. I do not want it set up like that. They say unless I do this there is really nothing they can do. I asked okay, can I mail the $500 this month. THen write checks for the remaining months? They said no, that does not show my willingness or consistency on paying the debt.

What should I do? I told them that unemployment pays little to nothing. I mean I get the max in GA. which is $330 per week. But still, with a truck note, utilities and mortgage. Nothing is left over.

I have always heard that if I am paying something per month that there is little they can do. But I am affraid of them sueing etc. I mean, I really having nothing for them to take if truth be known. But I am really worried about this. And Discover had told me that as long as I paid $200 per month that my account would be current.

Actually Redline was wanting 10% of the debt now, that is until I told them that I was laid off.

Sorry for the long winded post, but I worried and confused as to what to do. I have thought about filing bankruptcy but REALLY hate to have to do that. I had an almost perfect credit score prior to having to take a new job and move!

Bankruptcy chapter 7 may be a good choice for you as you are not working now, so they can not force you into another type of bankruptcy.

Forget about your FICO score prior to all this as it is not important, Once you have a charge off you may as well not worry about it.

Speak to a bankruptcy attorney, this site can put you in touch with one in your area.

I hope this all works out for you, good luck

gary71 · #3 11-12-2008, 05:56 PM

Chapter 7? I don't see that as an option. I really have nothing to liquidate. House is not paid for, no equity to speak of, have a truck that is not paid off either.

OhMy · #4 11-12-2008, 05:58 PM

Quoting gary71

Chapter 7? I don't see that as an option. I really have nothing to liquidate. House is not paid for, no equity to speak of, have a truck that is not paid off either.

If your total outstanding debts are LARGE then it may work for you. However, your post is vague, so it is hard to tell just what you are dealing with here as far as total debt

You can KEEP your home and your auto through a bankruptcy, you DO NOT have to give them up

gary71 · #5 11-12-2008, 06:19 PM

Sorry, I am talking about $13,000 on one credit card. Other than that I have a mortgage, truck note (which will be paid off 04/09), Lowes ($1500), Citi Bank ($800) and regular utilities. I am pretty much current on everything except the Discover ($13,000) card.

Betty3 · #6 11-12-2008, 06:20 PM

I have to agree with OhMy *based just on your post* that a Chapter 7 bankruptcy might be your best bet. You will have to talk to a bk attorney - we don't have complete information re your total financial picture.

Good luck.

gary71 · #7 11-12-2008, 06:23 PM

Betty3, please see post right above yours. I posted what other debts I have.

Thanks so much for all you guys help! I really appreciate it!

OhMy · #8 11-12-2008, 06:26 PM

Quoting gary71

Sorry, I am talking about $13,000 on one credit card. Other than that I have a mortgage, truck note (which will be paid off 04/09), Lowes ($1500), Citi Bank ($800) and regular utilities. I am pretty much current on everything except the Discover ($13,000) card.

You can hire a NON profit credit card debt service. They do a good job of REDUCING the principal amount that you owe. They can also do away with the DEFAULT rate of interest you are being charged.

Since your main problem seems to be Discover card, this would be a great option for you. There are many NON PROFIT companies out there, you can do a search on the BBB site to find a good one.

I have spoken to people on this site who have had over $300,000 in credit card debt. Since yours may be something you can handle with a lower interest rate and a possible decrease in principal balance, it may be your best bet.

Here is a link to one that is supposed to be good, but again, I really do not want to say as I never personally had any dealing with them;

http://www.cccservices.com/

Betty3 · #9 11-12-2008, 06:31 PM

gary - you & I were typing our posts at the same time but you submitted yours off one minute before me.

You might want to follow OhMy's advice.

gary71 · #10 11-12-2008, 06:36 PM

I will check out that site! Thanks so much for the info!

Betty....yeah thats what worries me, is getting sued. But from talking with Redline, there payment plan was only the automated monthly draws. My worry is that they can draw out the entire account if they wanted. I would rather be in control of that if at all possible really. I mean if they do the auto draw and I dont have the money in there, I'm screwed with a over draft right.