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  1. #1
    Join Date
    Oct 2012
    Posts
    3

    Question Paying Off Credit Card Debt After Defaulting Due to Illness

    My question involves collection proceedings in the State of: Florida

    Hi,

    I was ill for 4 months and I could not pay my credit cards. Im doing well now I want to get my financial situation under control. Today its been 6 months since I send a payment and I have received a lot of late fees. What would you recommend I do. My total debit is around $5000. What is the best payment plan or negotiation I can do with them. (I also have a car loan that is current)

    Thank you in advance

  2. #2
    Join Date
    Mar 2013
    Posts
    18,340

    Default Re: Credit Cards

    Quote Quoting escobar479
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    My total debit is around $5000. What is the best payment plan or negotiation I can do with them.
    Unless you have several thousand dollars in cash with which to make lump sum settlement offers I doubt that any of the credit card companies are going to give you the time of day especially since they are undoubtedly charging the default interest rate.

    Also keep in mind that talking about paying is not paying. An "I'll do this if you do that" approach isn't likely to work.

    I suggest you just start sending money right now in as large amounts as you can afford as often as you can afford.

    Once you show that you ARE paying you might be able to convince the credit card companies to reduce the interest rates back to their previously levels and maybe waive some of the late charges because of the illness. No guarantees, of course.

    You can try whatever approach you like, but don't be too disappointed if you don't get anywhere without actually making payments.

  3. #3
    Join Date
    Nov 2015
    Posts
    9

    Default Re: Credit Cards

    I would NEVER send large amounts of cash without first negotiating. Your only leverage to having your delinquent history erased is the cash you have in hand. Explain the scenario, ask for a goodwill, or offer a pay for delete. Look up Goodwill letters and PFD letters on creditboards.com, lots of good info there to help you out!

  4. #4
    Join Date
    Mar 2013
    Posts
    18,340

    Default Re: Credit Cards

    Quote Quoting gsxrmike
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    I would NEVER send large amounts of cash without first negotiating. Your only leverage to having your delinquent history erased is the cash you have in hand. Explain the scenario, ask for a goodwill, or offer a pay for delete. Look up Goodwill letters and PFD letters on creditboards.com, lots of good info there to help you out!
    That's all well and good if somebody owes tens of thousands in credit card debt but $5000 spread across two or more cards is chump change to credit card companies who are taking on a 29% default interest rate to the balance. Paying off small debts like that as quickly as possible is the best way. Any debtor who thinks he has leverage against a credit card company is delusional.

  5. #5
    Join Date
    Nov 2015
    Posts
    9

    Default Re: Credit Cards

    Quote Quoting adjusterjack
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    That's all well and good if somebody owes tens of thousands in credit card debt but $5000 spread across two or more cards is chump change to credit card companies who are taking on a 29% default interest rate to the balance. Paying off small debts like that as quickly as possible is the best way. Any debtor who thinks he has leverage against a credit card company is delusional.
    No, you're delusional. It's quite easy to PFD any amount, whether it be $500 or $50,000. How do I know? Personal experience.

    What the OP needs to pay attention to is whether or not the credit cards have went to collection. If so, he'll want to send a Debt Validation (DV) letter to the Collection Agency (CA) validating that they actually own the debt (per FDCPA rules). If they do, he can negotiate with them, and possibly can negotiate with the Original Creditor (OC) in case they want to pull it back from the CA. If the OC still owns the debt and it hasn't went to collections yet, pay the minimum due to bring the account current and write a GW letter to the CEO. A well written GW letter can go a LONG way to getting history erased. I went through the same thing when I was injured in the military, and my bad history was wiped clean. Creditors (whether they be the OC or CA) can do whatever they want, but it's all about incentivizing them...

  6. #6
    Join Date
    Mar 2013
    Posts
    18,340

    Default Re: Credit Cards

    Quote Quoting gsxrmike
    View Post

    What the OP needs to pay attention to is whether or not the credit cards have went to collection. If so, he'll want to send a Debt Validation (DV) letter to the Collection Agency (CA) validating that they actually own the debt (per FDCPA rules).
    The FDCPA does not say that the CA has to validate that it "owns" the debt. Read Section 809 of the FDCPA at:

    https://www.ftc.gov/enforcement/rule...s-act-text#809

    Most people get that wrong.

    Quote Quoting gsxrmike
    View Post

    I went through the same thing when I was injured in the military,
    You may have had some advantages under the Soldiers and Sailors Civil Relief Act.

    I'm not saying that the OP shouldn't try those tactics, just saying not to be surprised if they aren't a slam dunk solution.

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