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PBear

Collection Settlement Plan of Action?

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On 8/3/2019 at 2:21 AM, PBear said:

Around Feb/Mar 2018 I walked away from just over 80k in debt. I chose to walk away instead of Bk for multiple reasons. 

Now I have come into a little cast and want to start settling for less than owed. All debts except Capital One, Discover & WF have been shipped off to CAs. Mostly sold, some just collecting on behalf of OC.

None of the CA or even OC have spoken to me since I walked away. I don't answer numbers I know and have never responded to a collection letter. But I do get settlement offers frequently. Usually 40-60%.

So does anyone have advice on how to best approach negotiating settlements? What do I need in writing to make sure the debt really is settled and is not sold down the line with some new CA trying to collect and report on it?

My goal is to settle for 15% or less. I plan on starting out the negotiations for all at 10%. Those that won't settle I just plan to let ride out the 3 years left on SOL.

I really don't care if they sue me. Texas is debtor-friendly and I don't have any assets on my name anyway.

Below I have listed out the details of the debts. 

Bank         Current Collector
Amazon     Now     Midland Credit Management
Amex     Now    Nationwide Credit
Amex     Now     Nationwide Credit
Capital One     Now     Capital One
Capital One     Now  Capital One
Capital One     Now     Capital One
Chase     Now     United Collection Bureau
Chase Amazon      Now     United Collection Bureau
Citi     Now    Halsted Financial - LVNV Finding 
Citi     Now     Portfolio Recovery
Discover     Now     Discover
First National     Now    Frontline Asset
Lending Club     Now     Unknown
Wells Fargo     Now     Wells Fargo
Total Debt    80k+

You've already made some great progress! My spouse and I both started this process 2 years ago here in Texas (we started with nearly $200k in debt between car loans, credit cards, personal loans, and student loans). It has been amazing and provided us with a lot of freedom. Out strategy from the beginning was to focus on getting the best settlement deals and preventing lawsuits. In the 2 years, I have been sued twice. I beat the first one (a JDB suing over a Citi card) and settled the second one at 50% (BofA suing as OC). My husband did not get sued at all (knocking on wood until the SOL gets here).

 

I think your deals with Amex were excellent and well thought out, because they like to sue people. The Chase deals were good. I think I settled both of ours at 10% and 13% respectively. I would continue focusing on good deals and the creditors who will sue you is your best path forward. Personally, I would target the Capital One accounts next, because they are known to sue a lot as well. If you can't afford to settle those right now, then I would maybe work on the smaller accounts first. For the JDBs, there's a good case of settling with them first. They continuously monitor your credit report, and as you settle more debts, they will think you can afford to pay more for settlements. If you settle with them before some of the others, then they will think you are in really bad shape financially (possibly considering bankruptcy) and will work with you more. But if you go to them last, they could ask for more money.

 

A really good resource on this topic is the Consumer Recovery Network. Their website has a lot of detailed information on how to proactively settle stuff as well as info on particular creditors and collection agencies/lawyers. Lastly, I would say you need to locate a good consumer debt attorney for when and if you get sued. There aren't a lot of them, especially here in Austin, but a good one can get you better settlement deals if you get sued and make sure you are prepared if you need to go to court. However, I recommend settling as many as possible outside of the legal process because the costs go way up after all that starts. 

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21 hours ago, RehabbingANDBlabbing said:

 

You've already made some great progress! My spouse and I both started this process 2 years ago here in Texas (we started with nearly $200k in debt between car loans, credit cards, personal loans, and student loans). It has been amazing and provided us with a lot of freedom. Out strategy from the beginning was to focus on getting the best settlement deals and preventing lawsuits. In the 2 years, I have been sued twice. I beat the first one (a JDB suing over a Citi card) and settled the second one at 50% (BofA suing as OC). My husband did not get sued at all (knocking on wood until the SOL gets here).

 

I think your deals with Amex were excellent and well thought out, because they like to sue people. The Chase deals were good. I think I settled both of ours at 10% and 13% respectively. I would continue focusing on good deals and the creditors who will sue you is your best path forward. Personally, I would target the Capital One accounts next, because they are known to sue a lot as well. If you can't afford to settle those right now, then I would maybe work on the smaller accounts first. For the JDBs, there's a good case of settling with them first. They continuously monitor your credit report, and as you settle more debts, they will think you can afford to pay more for settlements. If you settle with them before some of the others, then they will think you are in really bad shape financially (possibly considering bankruptcy) and will work with you more. But if you go to them last, they could ask for more money.

 

A really good resource on this topic is the Consumer Recovery Network. Their website has a lot of detailed information on how to proactively settle stuff as well as info on particular creditors and collection agencies/lawyers. Lastly, I would say you need to locate a good consumer debt attorney for when and if you get sued. There aren't a lot of them, especially here in Austin, but a good one can get you better settlement deals if you get sued and make sure you are prepared if you need to go to court. However, I recommend settling as many as possible outside of the legal process because the costs go way up after all that starts. 

My wife and I have been going through similar. We had about 500k between us though. We legit did not have the money to settle accounts though as we were dealing with a medical issue in the family and all money went to it. 

 

My plan was to just lay low until the SOL ran out though. My wife just now is hitting the 3 year mark on her 200k in debt. She was sued and has two judgments for about 20k total. I am at the 2 year mark (1 year to go before sol is up). I have 1 judgment for 20k so far. 

 

I planned to just see what makes it past the SOL and then settle any judgments we get. 

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2 hours ago, Klesko said:

My wife and I have been going through similar. We had about 500k between us though. We legit did not have the money to settle accounts though as we were dealing with a medical issue in the family and all money went to it. 

 

My plan was to just lay low until the SOL ran out though. My wife just now is hitting the 3 year mark on her 200k in debt. She was sued and has two judgments for about 20k total. I am at the 2 year mark (1 year to go before sol is up). I have 1 judgment for 20k so far. 

 

I planned to just see what makes it past the SOL and then settle any judgments we get. 

Yeah, that's kind of where we ended up at as well. When you can't afford to settle all the debt, you can't necessarily file bankruptcy, and you don't want to get the debt collectors salivating over what little you have left, there is pretty much no other choice. For us, it took at least a year before we could afford to settle anything. I'm glad we waited anyway because all the original creditors wanted a super high percentage on the debts. We still have a lot of outstanding debts that need to be settle or that we just have to ignore for as long as possible, but we are steadily chipping away at them one settlement at a time. I have two remaining debts right now, one is a charged off PenFed credit card for $14k and the other is a charged-off Elan credit card for $23k. I fully plan on leaving these alone until they hit the SOL. I've checked my local courts and there are no lawsuits listed for either of them. In the meantime, we are working on my husband's credit cards (3 more to settle) and leaving his charged off personal loans alone. Most of his personal loans went to debt buyers who we could likely beat in court, so they aren't as much of a concern. 

 

I would say you should consider paying on those judgments, at least for your wife if she has hit her safe date (SOL). Interest does accrue so if she is safe, then it is not helping anyone to delay paying hers. For yours, waiting the 1 year makes sense. I assume they have no way of collecting from either of you?

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14 minutes ago, RehabbingANDBlabbing said:

Yeah, that's kind of where we ended up at as well. When you can't afford to settle all the debt, you can't necessarily file bankruptcy, and you don't want to get the debt collectors salivating over what little you have left, there is pretty much no other choice. For us, it took at least a year before we could afford to settle anything. I'm glad we waited anyway because all the original creditors wanted a super high percentage on the debts. We still have a lot of outstanding debts that need to be settle or that we just have to ignore for as long as possible, but we are steadily chipping away at them one settlement at a time. I have two remaining debts right now, one is a charged off PenFed credit card for $14k and the other is a charged-off Elan credit card for $23k. I fully plan on leaving these alone until they hit the SOL. I've checked my local courts and there are no lawsuits listed for either of them. In the meantime, we are working on my husband's credit cards (3 more to settle) and leaving his charged off personal loans alone. Most of his personal loans went to debt buyers who we could likely beat in court, so they aren't as much of a concern. 

 

I would say you should consider paying on those judgments, at least for your wife if she has hit her safe date (SOL). Interest does accrue so if she is safe, then it is not helping anyone to delay paying hers. For yours, waiting the 1 year makes sense. I assume they have no way of collecting from either of you?

I plan to settle the wife's judgments as soon as I can, maybe 3-6 months depending on some things. 

 

One good thing is I am in NC. The first place that sued my wife (I read up on them they are aggressive) already had the sheriff try and collect. I talked with him on the phone and they were nice about it. He told me that he saw no assets he could take (not enough equity in the house, no cars with equity, minus the NC exclusions) and would return the order as not able to fill. 

 

In NC wages cannot be garnished also. Only thing I need to worry about is a bank levy. I try and keep as little as possible in them for now. 

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Yeah not to concerned about getting sued. I have zero assets, reside in TX and am self employed via an LLC. This stone ain't got no blood to squeeze 🙂

Edited by PBear

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6 hours ago, PBear said:

Yeah not to concerned about getting sued. I have zero assets, reside in TX and am self employed via an LLC. This stone ain't got no blood to squeeze 🙂

Too many people take that approach and wind up with judgments that live on for decades.  You may not have assets at this juncture, but you don't know what will occur within the first decade of the life of the judgment...then it is fair game for renewal, which gives ANOTHER decade.  Oh, and the entire sum, both the amount sued for AND the fees awarded by the Court will continue to accumulate post-judgment interest at a rate of roughly six to eight percent per annum. 

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13 minutes ago, centex said:

Too many people take that approach and wind up with judgments that live on for decades.  You may not have assets at this juncture, but you don't know what will occur within the first decade of the life of the judgment...then it is fair game for renewal, which gives ANOTHER decade.  Oh, and the entire sum, both the amount sued for AND the fees awarded by the Court will continue to accumulate post-judgment interest at a rate of roughly six to eight percent per annum. 

 

I plan to settle my judgments as soon as my SOL is up. I am shooting for 50% settlement on them. I admit I have never had or settled a judgment though and I know they can be harder to settle so will have to see how it goes. 

 

Worse case if things go really bad I will do BK to wipe them out, but that's my safety net plan I hope I dont need to use.

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