New here..need serious help

[saw5308]

I have about 11K in credit card debt over a span of about 5 credit cards. All but one have been in collections / charged off for about 4 years now. I have read a ton of stuff on the boards already and am retaining alot of info but it's all still so confusing. All this happened when i moved to another state for a year, had to get cards to live off of, then lost my job and came back. I am trying to rebuild my credit (my score is around 500). I don't know if collection agencies are still calling because I no longer have that phone.

Do I try to settle ? I don't want to wait until the SOL (which is 6 years) , I want to do something about it now.

Any advice on where to begin would be greatly appreciated!

[Sandscrit]

Hi Saw, Keep reading the newbie posts like Psychdoc's seminars on credit repair until it becomes clear to you what to do. if you have the money, then you can try to get a pay for delete, use the one two punch and other tools at your disposal.

[Unconventional]

You might start by getting copies of all of your credit reports. Choose one account at a time to deal with so that you're less overwhelmed. Communicate with the first creditor you choose to work with and see how it goes if you try to negotiate a settlement and 'pay for delete'.

[spiritrise]

Hi Saw -

I had an unpleasent surprise after settling a few credit accounts through an agency. They never told me that the money I saved through them is taxable, just as income.

So be mindful of that should you choose such a service.

[coachtom2183]

I agree with all of the above however don't forget to start new clean credit lines. If you have a credit union or qualify for USAA get a secured card no fee's also get a finger hut acct they didn't deny me when I was 495 use it a couple times they will raise your credit line fast.

[candicejoy]

I work in collections and the common misperception is that once the sol is up, you don't have to pay it. The sol only applies to a creditor or collection agency pursuing you through legal remedies to pay the debt. Definatley get a copy of your credit reports. Call each company that has your credit cards and first request validation of each debt. You want something in writing showing which company has your account(s). You can do settling options, or payment plans on your debts. A lot of companies will delete the debt once its resolved.

 

You would get a 1099 if you settle a debt that exceeds $600 for the difference. Example: You owe $1000 you settle for $300, you'd get a 1099. However, with only 11k in debt, lets say you settle out for $4000 in total. Would adding 6k (the difference) to this years income severely impact your taxes? Most likely not.

 

No matter what you work out with these companies, GET IT IN WRITING. These companies sell off these debts so much you might pay one and a month later have another company trying to collect on the same debt. But its ok, as long as you have proof you paid it off with another company.

[ICANHASMUNY?]

When the SOL has passed, you are under no legal obligation to pay it.

 

if you are sued, you have to raise it as an affirmative defense in court.

 

IT IS A VIOLATION OF THE FDCPA FOR A DEBT COLLECTOR TO FILE SUIT ON A TIME BARRED DEBT WHEN THEY SHOULD REASONABLY KNOW IT IS PAST THE STATUTE OF LIMITATIONS, AND DON'T BELIEVE A DEBT COLLECTOR WHO TELLS YOU OTHERWISE.

 

A REPAYMENT OR AN AKNOWLEDGEMENT OF A DEBT IN WRITING USUALLY RESETS THE STATUTE OF LIMITATIONS AND IT STARTS OVER.

 

SOL is generally tolled when your out of state.

 

check your state laws.

 

also, check your state borrowing statutes. the lenders home state SOL may apply

 

odds are you're dealing with JDB's not CA's for the original lender.

 

there is a state law forum...

 

A

[ICANHASMUNY?]

I work in collections and the common misperception is that once the sol is up, you don't have to pay it. The sol only applies to a creditor or collection agency pursuing you through legal remedies to pay the debt.

 

I think you better recheck with your supervisor.

 

if you are handing out this sort of nonsense while trying to collect, you're going to get your company sued.

 

Who do you work for, BTW?

[LKH]

 

I work in collections and the common misperception is that once the sol is up, you don't have to pay it. The sol only applies to a creditor or collection agency pursuing you through legal remedies to pay the debt.

 

I think you better recheck with your supervisor.

 

if you are handing out this sort of nonsense while trying to collect, you're going to get your company sued.

 

Who do you work for, BTW?

 

 

What ICan said. Also, OP, if you do attempt to settle these debts for less than full amount, get everything in writing. No phone calls. but be very careful what you put in letters to collectors. If unsure, ask here BEFORE you mail it.

[cashnocredit]

I work in collections and the common misperception is that once the sol is up, you don't have to pay it. The sol only applies to a creditor or collection agency pursuing you through legal remedies to pay the debt. Definatley get a copy of your credit reports. Call each company that has your credit cards and first request validation of each debt. You want something in writing showing which company has your account(s). You can do settling options, or payment plans on your debts. A lot of companies will delete the debt once its resolved.

 

You would get a 1099 if you settle a debt that exceeds $600 for the difference. Example: You owe $1000 you settle for $300, you'd get a 1099. However, with only 11k in debt, lets say you settle out for $4000 in total. Would adding 6k (the difference) to this years income severely impact your taxes? Most likely not.

 

No matter what you work out with these companies, GET IT IN WRITING. These companies sell off these debts so much you might pay one and a month later have another company trying to collect on the same debt. But its ok, as long as you have proof you paid it off with another company.

 

The tax obligation, which is triggered upon settlement and results in a 1099-C in the current tax year for differences > $600, together with the settlement amount will always be much larger that the tax obligation alone if the entire debt becomes deemed uncollectable.

 

It's really nutty to raise the IRS 1099-C factor as if it is ever better to pay an out of SOL debt.

[esp1222]

Boy, she jetted pretty quick after ICANHASMUNY called her out. ICAN, you saved me a few years ago! I was a little skeptical of that poster the first post I saw! Wonder what her/his angle was?

[BDK]

Boy, she jetted pretty quick after ICANHASMUNY called her out. ICAN, you saved me a few years ago! I was a little skeptical of that poster the first post I saw! Wonder what her/his angle was?

 

Smoke and mirrors..

[ICANHASMUNY?]

BAck to the original question;

I have about 11K in credit card debt over a span of about 5 credit cards. All but one have been in collections / charged off for about 4 years now. I have read a ton of stuff on the boards already and am retaining alot of info but it's all still so confusing. All this happened when i moved to another state for a year, had to get cards to live off of, then lost my job and came back. I am trying to rebuild my credit (my score is around 500). I don't know if collection agencies are still calling because I no longer have that phone.

Do I try to settle ? I don't want to wait until the SOL (which is 6 years) , I want to do something about it now.

Any advice on where to begin would be greatly appreciated!

what state are you in, and who are the lenders?

 

your state may have a borrowing statute which uses the lenders Home state SOL, not your state's SOL.

 

like in NY, the 6 year SOL doesn't apply to Discover CC's - they borrow Deleware SOL which is 3 years.

 

http://creditboards.com/forums/index.php?showtopic=477180