Credit Debt

Credit Debt questions and answers

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Q: Credit Debt?
I have under $5000 in debt, and I want to make payments, but the payments I can afford, are not even covering the interest I am being charged. This debt was written off as bad debt, and killing my credit along with my debt growing. Does anyone have ideas in ways to get this debt lowered, by negotiating? The majority of the debt came fom Capital One and the agency who now has the account said that they will not negotiate a payment plan with me, per Capital One's requirements. They will work with me on a payoff, but I cannot afford the payoff. Any ideas out there?

A: Contact me. My brother works for a company that "eliminates all credit card debt" (in other words, pay a fee significantly less then the credit card debt and you won't owe the credit card company a dime). (take a credit card cash advance to pay the fee LOL). There will be no damage to your credit rating!

Q: How does consolidating credit debt effect a credit rating?
My credit rating is probably better than the average as I pay all my credit bills on time, but I'd like to consolidate all the debt for a lower interest rate, with an eye on paying it all off faster. Would it be better to pay off the balances individually than to consolidate? How will zero credit card balances effect my credit rating? Any suggestions, and any recommended books, would be appreciated. Thank you!

A: Consolidating debt is an ideal way to reduce your amount and tenure of debt. You make a single payment to one lender on a certain date and this will help you clear off the debts faster. I would recommend you to visit this site for more info about consolidating debt: http://www.debt-explained.com/category/Ways-to-Consolidate-Debt.html

Q: What is the statute of limitations for credit debt in Nebraska?
I received a phone call from First National Collection Bureau regarding a debt from Sept. 1998. I don't recall having an account with the bank they mentioned. They sent me a letter stating that if I don't respond to them in writing then they would assume the debt is valid. I have no records, even credit report, that shows this debt. Should I worry about this?

A: As stated by others, the SOL for your state is 4 years for open contracts (credit cards). Send them the reply they want only use this form letter (you fill in the blanks). This should send them away. If not then you can seek civil suit against them for minimum of $1000. But make sure that this debt is for a credit card and not for a court ordered judgment. A judgment in Nebraska has a SOL of 5 years and is renewable. Your Name Your Address City, State, Zip Date: General Revenue Corporation Address City, State, Zip Re: Acct #XXXXX To Whom It May Concern This letter comes in response to your [letter dated xx-xx-20xx] (copy enclosed) concerning the collection of the above referenced account. First, I want to inform you that I am well aware of my rights under the Fair Debt Collection Practices Act (FDCPA) and applicable State laws. Having said this, I hope to save both of us a great deal of time by informing you that I formally dispute the validity of this debt. In addition, I am aware that the time period limiting legal actions to enforce this type of debt in (insert your state or the state in which the contract was signed) has expired. Furthermore, I am aware that any attempt to bring an action in court that is time-barred may result in sanctions for filing a frivolous claim. As of today, I consider this matter closed and demand that your agency and affiliates immediately cease and desist contact with me regarding this matter except to advise me that your debt collection efforts are being terminated. Further communication attempts of any form or substance are prohibited by the Fair Debt Collection Practices Act, 15 USC 1692a, et seq. I plan to report any such violations to my State Attorney General and the Federal Trade Commission and, if necessary, to take whatever legal action is necessary to protect myself. Thank you for your prompt attention to this matter. Sincerely, Your Name Hope this answer is of help to you LEGAL DISCLAIMER: The answer provided here is intended for informational purposes only. It is not intended nor presumed to be legal counsel or professional legal advice

Q: How to get a loan to pay off old credit debt?
About 6 years ago I had alot of credit and let it all go. I thought it went away after 7 years, but that is not true. All they do is keep selling it to other companys. Well i just got summons to court for an old debt. so how do I get a loan with bad credit to pay off old debt.

A: Given your credit history, you may not be able to get a loan of any kind. First you need to get hold of your credit reports. There are three major credit reporting agencies in the USA: Experian, TransUnion, and Equifax. Offhand, I don't know contact information for them, but you should be able to find snail-mail addresses and phone numbers for them online or in your local public library. Write to each of them or phone each of them to find out what their reports are saying about you. Once you know what the reports say, you will be better equipped to deal with it. You've received a summons to appear in court? What kind of court? Small claims? It sounds like you need an attorney. Perhaps you should consider declaring bankruptcy. In any case, don't ignore the court summons. Make sure that you show up in court, and if the judge orders you to pay, you have to pay. You don't want what is called a "judgement" on your record, because that *never* scrolls off your credit reports, like some other debts do after seven years. How much in debt are you? Hundreds of dollars? Thousands? Tens of thousands? There are credit counseling agencies in many locations in the US. Perhaps there is one in your area. Contact them, make an appointment, and see if they will help you. But they won't give you a loan. They will, at best, make it easier for you to pay off your debts.

Q: To boost my credit score is it better to use money to pay off a federal tax lien or credit debt?
I have some cash and want to improve my credit score. I have an IRS tax lien for about the same amount as my outstanding credit card balances. What would be a better action? Should I pay off the tax lien, currently on installment, or should I pay off credit card debt?

A: You don't say if the CC Debt is current(but just excessive) or actually delinquent and in collections. If the CC Debt is current pay off the lien. As the lien is harming your credit more than the Credit cards are. Also, even though you are on a payment plan the IRS could take further action and has more "tools" to get you to pay than the Credit Cards do. If the Credit Cards are in collections and they could successfully sue you, that is you are still in the Statute of Limitations. It MAY be to your advantage to take care of these to avoid additional judgments from showing up on your report.

Q: Will transferring my credit debt to a 4th credit card hurt my FICO score?
Will transferring my credit debt to a 4th credit card hurt my FICO score? The APR is killing me on two of them.

A: If you are in that much money trouble, your FICO score already stinks. Just work on getting yourself out of debt. Good Luck!

Q: How can you get into a home without any money down, bad credit and substancial debt?
I have been in and out of the hospital and am unable to work , my husband makes over $55,000 a year but we are a family of 5 crammed into a 2 bedroom apt. He has student loans and bad credit from divorce. He had a home from his previous marriage, but I have never been a home owner. The question is how can we get out of this hole we are in and start moving on with our life? Iwant to try to be in a home b4 my 3 yr old son starts school.. because the schools where I currently live are unsatisfactory. we currently pay $650 a month in rent .. which is more than most of my friends house payments so I am wondering how do I get started trying to improve our situation and get into a home .. with $1,000 in debt each month and no way to possibly save for a down payment of any kind. We have paid our rent every month, that is one thing we do make sure gets paid . have been in and out of the hospital and am unable to work , though we have not asked or have been receiving any assistance what so ever. My conditions include spinal bone growths, organ failure and chronic pain , which makes it difficult to just care for my son and my 2 step sons (which are all under the age of 12), Since my doctors have told me I am physically unable to work right now options for going back to work are not really there. My husband works 12 hour days at his job, that he has held for over 7 years. We have 1 car( that is paid off). Our rent of $650 a month that we do pay does not include our utlities or anything else. Our phone bills, electric, cable, water all get paid as well and we have a good payment history with them as well. Our credit debt includes :my husbands government student loans, credit cards from his previous marriage, and one month of car insurance not paid by me after I went into the hospital. we are looking for a home in the $50-$100k price range .. so that we can make our payments.

A: Try going to a new home builder. Like getting a new car, a new home will probably be easier to get into than a used home. My wife are only 24 years old and also have bad credit (560 for me 580 for her) and debt ($3k owed to an apt. complex for broken lease among other things). Combined we only make about $40-45k a year which is less than your husband. The home builder that we were with couldn't get us financed in house with them but because they wanted our business our loan officer referred us to another company that got us approved. This company was actually able to use my wife's credit with my income level but this might have worked well for use because we work in the same company. To be honest with you your financial situation seems to balance out with ours because we have not kids but we do pay for a $450/mo. car note and our mortgage is $950/mo. as opposed to the $650 you say that your friends are paying for mortgage. The only thing you must be aware of is property taxes. Property taxes range in different areas but they may be anywhere from $2,000-$6,000 or more per year depending on where you live. Your lien holder can include this into your note as a monthly payment and many times will depending on your type of loan (conventional, fha, 80/20, etc.). Our taxes for our area are about $4,500 a year which puts us at about an additional $400/mo. bringing our total monthly payment to around $1350. If you think that getting a used house might be cheaper, do your research. We were able to buy our house for $130k which is about the price that the used homes were selling for. It only made sense to get a brand new house that cost as much as a used house. The figures however will still run the same with the same taxes and same interest rate only you might have a tougher time getting a loan because there is no one pushing to get your business except for the loan officer and/or real estate agent who can only do so much for you. New home builders have many contacts that make buying a house a possibility for anyone.

Q: Would paying one thing off of my credit debt change my score a little bit?
My credit score is 544, and I have two outstanding debts on my account, one is a medical bill for $380.00 and another is a cell phone bill for $1,025.00. If I paid for my medical bill in whole, how many points do you think that would bring my score up until I am able to make some payments on my cell phone debt?

A: Above poster is 100% correct. I just have a few extra things to add. If you go for a pay for delete, expect the collection agencies to not want to do it. Keep calling, keep talking to different reps and do it close to the end of the month. They are much more likely to agree to this if its close to the time they have to make their collection quotas. Make sure they fax the agreement to you BEFORE you give them the money. Also make sure that the agreement includes (if you settled) a statement that they agree NOT to sell the remaining balance to any other collection agency. If you don't, then you are going to discover 6 months down the road a new CA on your credit report, your score plummetting, and a whole new set of CA interest charges and fees to pay. Not fun. Pay the cell phone debt first, not the medical collection. When lenders pull your credit and actually analyze the entries, medical collections are often not taken into account when tallying up your overall credit worthiness. The cell phone bill will be. Granted, both drop your FICO score, but the cell phone bill is much worse in the long run to someone analying your debt. If the CAs refuse pay for deletes then dispute both items with the credit reporting agencies as "I do not recognize this item, could you please look into it." Include a copy of that agency's credit report and wait. If the CAs do not have enough information on you (and many times they don't) they will be unable to verify and the tradelines will be removed. I'd attempt this before paying anyone a dime. Best of luck.

Q: How can I fix my credit debt that my parents messed up?
When I was younger about 14 or 15 my parents got credit cards in my name (which i think is illegal but it was to help at the time) but hard times hit and they kept using them although we didnt have the money. So eventually she stopped using them but now im way in debt and they cant afford to pay it off and neither can i ( i am only 19 years old). i cant get a decent apartment or get credit cards and some jobs that require a credit check... cant get those im going on a trip to cancun but i need a credit card but i need to fix my credit which is the most important thing to me right now. if i get legal help my parents could get in serious trouble which of course me being their child i dont want can anyone help at all?

A: Actually... It is illegal for the credit beauro's to report any credit what so ever on a minor. So you can file disputes will the three major credit reporting agencies... Transunion Experian and Equifax.... Once you file a dispute on those credit card debts they have 30 days to prove that the debt is yours, if the credit card companies can't prove it then they MUST remove it from your credit... Just simply state these debt('s) do not belong to me and there is no way they could be associated with me due to the fact that the date they were established I was a minor. Btw they won't do anything to your parents.

Q: How do I fix credit card debt, I got good info on http://credit-debt-consolidation.blogspot.com/ , need more?
I have $10,000 in credit card debt, and found some resourceful information on the blog with some good links, and I am wondering if anyone has some more.

A: sure dude, here I found tons more. It'll take a month to read it all. I've found some good information here too... http://www.safelinked.info/jump.php?link=debt Hope that helps.

Q: Credit debt issues: How can I help to improve someones credit issues?
I am trying to help out a family member resolve credit issues. Is there anything out there that can help her credit situation? Her score is 550 and she has about 8500. in credit card debt. She cannot get another card because of bad credit history. Any answers?

A: mojo, I suggest you try calling a local credit restoration company. http://www.tipstoimprovecredit.com They should have some programs for you.

Q: Selling home, making a profit - better to pay off credit card debt or put money into new home?
I have some credit debt left and I'm wondering if I should put the extra money I make from selling my home into the new house I'm purchasing or if I should go ahead and pay off the credit card debt. What is a smarter decision?

A: Have you lived in it for at least 2 of the last 5 years? If so, there's no capital gains tax from the IRS, and the money is yours to spend as you wish. I've bookmarked this site... http://debt.123thebest.info/credit_card.html Hope that helps.

Q: Should I get a house, pay off credit debt or pay off private student loans?
I have about 30k in cash laying about in a low interest account (3%). I could use this to pay off my credit card debt of about 5k or pay down my student loans (40k - private@8%). Additionally, since prices in my area have come down I could use this to pay into a mortgage (no greater than 200k). With so many options which way should I go?

A: Pay off your credit card debt first. Pay off your student loans next (maybe about $15k of it), leaving enough of an emergency fund for when shit happens (because it will). Housing prices WILL continue to come down over the next year or so, I wouldn't rush into home ownership just to have property. It could take that long to find something you like as well.

Q: Who would like to pay off my credit card debt for me?
Kidding.. but if anyone does have extra cash..I'd be grateful for the offer. Actually, I'd like to know advice on the best way to pay off credit card debt. I have about 10,000 in credit debt. Mostly from going through a divorce a few years ago.

A: I'm going to check your answers because I need the same help!! GOOD LUCK!

Q: Is it worse to have lots of debt on your credit report, or to close out cards and make payment deals?
I have lots of credit debt and want to close out the credit accounts as I pay them to stop interest and make payment plans. Would it be better to pay the interest and live in debt or close out my accounts and pay them at a slower speed? Also, how long will the negatives be on my report? Note: I am on the brink of collections now anyway.

A: Closing the cards is WORSE. Either way you still have the debt. Why not STOP USING THE CARDS. See oddly enough even if you have a card you don't have to spend on it. Get a little safe or lockbox or something and LOCK THEM UP. That way you have them but can't use them basically. As to why closing them would be worse. Simple you would have the debt and NO credit. Instead of being in debt you would have even worse. It would be seen as a negative credit line, instead of debt. A debt means you have the credit line but you owe too much basically. A negative credit line means you have NO credit line it is just the debt. Hope that makes some sense.