Don’t pay them,what is the worst that could happen?
I think she would be best off contacting the following folks
http://getoutofdebt.org/2604/debt-counselors-of-america-what-i-learned
debt counselors of America has been used by a couple of folks I know. It does more than just charge you money to give you stupid ways to repair your ‘credit’. Your daughter needs help in learning how to handle money not in repairing her credit.
This is a non profit and they do good work
Lexington Law Firm
I’ve heard a number of times that most of the “credit repair” services are rip-offs.
I seem to recall is something like “Consumer Credit Counseling.” But I’m fairly certain this isn’t a “credit repair service.”
I would strongly advise checking out the web sites of Dave Ramsey and Clark Howard. They may have good information that could help.
Mark
Those credit repair services are crooked and generally strike a deal that benefits them financially, not your daughter. Have her call the creditors and try to make her own deal. Bottom line would be “I’ll pay regularly what I can or I’ll pay you nothing.”
After seven years, non-Federal debt disappears from her credit report. One strategy is to let the existing debt expire. If she turns over a new leaf, the credit bureau computers should recognize her new financial trend and over time bump up her credit rating.
First check with your state government or hers if she is out of state. You need to know which ones they approve. Ohio has some such “laws.”
Second find an attorney. You say there is a lot...well an attorney will help you and her decide if consolidation or bankruptcy is the better choice.
Keep in mind bankruptcy comes in several forms one is payback and the other is write-off. An attorney will help you sift through the options and may be able to stall the debt collectors while you and her are in the process of sorting things out.
I was in the same hole years ago right after graduation from jr college. Then I had to go to university. Credit counseling services are legit, especially for mine but my company was located in canada. They consolidate EVERY bill I owed, and all creditors literally backed off as they had to face this one company. Basically those creditors stopped harassing me as the company sent them cease&desist letters.
Now your main problem is down to this one company, instead of multiple creditors who want to, which is a good thing. This was how I learned to live “off the grid” to avoid being found out by those creditors—to avoid say, more letters or repo guys. Paying cash for apartment with a fake name, making sure the internet,phone bill was attached to the landlord, buying a disposable phone etc. I learned how to live like a spy..Heck, I should write a book about living undetected.
Your first step is to burn the credit cards and make sure she doesn’t combine all of them into one payment and then start building debt again.
You have to quit it Cold Turkey.
I remembver a story of a guy who put all of thebills in a hate and drew as many out each month as he could pay. If he got any crap from a creditor he didn’t put their name in the hat next month.
Renegotiation of the payment terms is essentially chapter 7. She is better off consulting a bankruptcy attorney for advice.
Most of the credit repair services are rip offs. The only way to repair your credit is to pay your bills consistently over time.
Many many stories of people who use those services who only end up with more debt and several years of pain.
I went through this with my daughter several years ago. I used it as an opportunity to teach some lessons that I had apparently neglected in her formative years. I told her that I would deal with any and all collection agencies and collectors but that she would need to get two jobs and turn over her paychecks to me. I then gave her an allotment that was reasonable to live on and used the rest to pay her bills. Each time I recieved a bill from a collection agent I called them explained the situation and offered them a settlement. Each and every one settled for approx. half what she owed. She had to be present and on speakerphone while I negotiated with her creditors(my rule) and she learned quite a lot about how to deal with people. When one agent swore at me I politely informed him that he was in violation of the fair credit laws and that I would call him again next month and that all future communication with him would be recorded(necessary in the state of NY). Dave Ramsey recommends a similar approach. Be sure to get agreement in writing prior to making payment. At the end of the process she was proud of herself for paying everyone off with her own money. She has had no further debt issues. Good luck.
I have your answer!
I found a place on the web called creditboardsdotcom about 6 years ago when my husband and I got into trouble. If you and your daughter will take the time and read the newbie section and then ask questions, you will be able to rebuild. It will not happen overnight, but if you are committed to credit repair, you will succeed. Do not pay someone to do what you can do for yourself. A credit repair will do the same thing and take just as much time. You will feel a great sense of accomplishment and your daughter will learn to be more responsible with her money and credit.
BTW....after I cleaned mine and my husbands credit, we both have scores in the low 700’s and many credit cards and low car payments, and we bought a new house in 2011!
Good Luck, you CAN do it!
It’s happened to a lot of people. The credit bureaus, each one, have a wealth of knowledge on the subject on their individual websites. Also, the website of consumer advocate, Clark Howard, www.clarkhoward.com, has a lot of advice and you can ask questions of a professional. if you’re looking to consolidate everything, you have to find someone who can loan you the money. With bad credit, it’s not wise to do that. You end up working with loan sharks. Unfortunately, the only other solution is to do it through an attorney....a form of bankruptcy. If your daughter chooses not to pay anything, they’ll drive her nuts with collections for the next twenty years. The main thing is to get a plan, stick to it, and be patient. I would check out Clark Howard. Sometimes the creditor will entertain an offer just to be able to close the account.
Stop. She needs to pay them, not come up with a gimmick
no such thing. If she can’t handle debt responsibly there are 2 tracks. bankruptcy or negotiating a no interest repay. both will impact her credit score, but calling and working out a long term payout will in the long term prove she is a good debt.
collection agencies buy bad debt for pennies.
Most of the credit repair businesses are NOT reputable and will only make her life even worse.
I would suggest that she consider filing chapter 13 bankruptcy. With chapter 13, her payments are rolled into a single payment and chapter 13 is structured so that she will not only be debt-free in 5 years, but her credit report will not reflect that she declared bankruptcy. This way she gets a fresh start with a clean credit record.
HOWEVER . . . . her credit report will likely still reflect that she had several accounts that were late and sent to collection. I don’t think that the aftermath of chapter 13 will remove that from her credit report until a full seven years have passed. Nonetheless, IMO, this is her best chance to clean up her debts and start fresh.
it’s called filing for chapter 13 bankruptcy, one simple monthly payment
Please consider bankruptcy, consult an atty who does a lot of that work, as it has gotten very complicated.
IMO, first thing is to call an attorney. If some of the debt is already in the hands of collection services, she might be advised to discontinue payment of all non-secured bills. I believe in Chapter 7 bills must be 90 days delinquent before the attorney can actually file with the court. Don’t bother paying for anything that she wants to make “good” on. All bills except for a few (student loans and taxes) will be part of the bankruptcy. Once you’ve hired an attorney, give collection callers the attorney name & ph#. Good Luck. Hope she learns that cash is king.