Calling all collectors!

[telenator]

What is the name of your state? IL

I have posted our situation in a previous thread.

My wife was injured and has been unable to work for 2 years and I have been paying her pre-marriage debt since. I had to stop paying hers in order to cover taxes due for 05.

Two things are happening for her. One she is filing with Social Security for disability benefits and two, she has a personal injury case still pending from being t-boned.

Her credit card companies are now calling after missing the first payments.

Questions: Should a letter be sent to creditors explaining the situation?

How long now days does it take before they begin legal action?

Her lawyer is aware of our situation but would it be good for us to involve the creditors in her Personal injury case?

She may end up filing for BK and we will be seeing a BK attorney soon. I think it is best for us to wait untill her SS and personal injury cases are finished before considering BK and evaluate at that time the ability to pay her creditors before filing any BK.

However, my final question would be will she be in any kind of a position at that point of negotiating a settelment for less than the amount due.

My personal opinion of the CC industry after watching them take advantage by raising her rates to near 30% on _BS_ that her payment came in late (Total BS) is that they have no integrity and are on the level of loan sharks run by Enron style money mongers and for what they have done to so many people by sucking then into low rate cards with the intent of locking them into high rate long term debt affords them nothing but a future of burning in a proverbial hell.

So please don't get on any moral soap box with me about paying what you owe to them.
They do not conduct business in a strait forward ethical manner.

I think that taking any advantage possible in dealing with them is tit for tat.

Lady in Red, I would especially be interested in your feedback as I know you have been there.

Thank you all.

 

[Debt Guy]

Q. Should a letter be sent to creditors explaining the situation?

A. Won't help. Won't hurt. In truth, they really do not care what happened. On balance, I would send the letter just to have some sort of papertrail. How are you going to handle all the phone calls?

Q. How long now days does it take before they begin legal action?

A. Legal action is generally not taken until after the account is charged off -- 6 months delinquent. But, there are exceptions. Some banks are very aggressive and others are less so.

Q. Her lawyer is aware of our situation but would it be good for us to involve the creditors in her Personal injury case?

A. Maybe. Maybe not. Again, they only want their money. They are not likely to be overly interested in being "involved" in the personal injury case.

Q. She may end up filing for BK and we will be seeing a BK attorney soon. I think it is best for us to wait untill her SS and personal injury cases are finished before considering BK and evaluate at that time the ability to pay her creditors before filing any BK.

A. Be careful and talk openly to the BK attorney to make sure they understand the big picture. If she files before settlement of the personal injury case, the BK trustee may take the ownership of the personal injury case for the benefit of the creditors. If the case is settled, then she has cash. She cannot file BK and keep the cash. The laws of your state will govern this situation.

Q. However, my final question would be will she be in any kind of a position at that point of negotiating a settelment for less than the amount due.

A. Every creditor has different guidelines. Initially, they will not even discuss settlement. If they know she has cash to pay, they will never settle but will litigate. Generally, as the debt gets older, they will be more and more interested in settlement. Personally, I think this is not something you should try to do yourself. I doubt you have a clue what percentage makes sense at various stages of delinquency and could properly negotiate to your advantage and then properly document the transaction. No slam on you -- very few consumers have those skills.

Q. My personal opinion of the CC industry after watching them take advantage by raising her rates to near 30% on _BS_ that her payment came in late (Total BS) is that they have no integrity and are on the level of loan sharks run by Enron style money mongers and for what they have done to so many people by sucking then into low rate cards with the intent of locking them into high rate long term debt affords them nothing but a future of burning in a proverbial hell.

A. OK. I agree they are scum. But, they are only doing what she agreed they could do when she signed the credit card application and used the card. If the situation were reversed and Discover were in financial trouble, would you throw them some extra dollars becase they needed the help? I don't think so. You would say "so sad, so sorry". Every person (including corporations) act in their own self interest. To the best of my knowledge, communism is alive and well only in Cuba and North Korea. The rest of the world is pretty much capitalist to one degree or another.

Q. So please don't get on any moral soap box with me about paying what you owe to them.

A. I have no soap box. I, do however, have a small ladder.

Q. They do not conduct business in a strait forward ethical manner.

A. Again, they are acting in accordance with the contract between the two parties. It is certainly straight forward. It is probably not ethical. It is, however, legal and will stand the test of a court challenge.

Q. I think that taking any advantage possible in dealing with them is tit for tat.

A. They could care less. To them, it is just business. They want they money. They are legally entitled to their money. They will use every legal device in their toolbox to get their money. They will make whatever business decision they think makes the most sense at the moment -- they might settle, they might sue, they might just let the debt be sold and be someone else's problem.

Debtcollector posted here once on guidelines for negotiating a settlement. Do a search.

I am not trying to be hard on you. But, you need to face the reality and get this "it is unfair" crap out of your head because it will only make things harder for you.

 

[Zellerscrossing]

Another Tip

Debt guy answered your questions just as I would but I did want to add a peice of advice. Call your credit card company and ask for a hardship arrangment, or some type of payment plan. They should be more than happy to offer an arrangment that will give you a small payment, lowered APR, and possible late fee and over the credit limit fee supression.

 

[Ladynred]

Call your credit card company and ask for a hardship arrangment, or some type of payment plan. They should be more than happy to offer an arrangment that will give you a small payment, lowered APR, and possible late fee and over the credit limit fee supression.

Don't count on it. Creditors don't want you on a hardship program because they lose money. You *MIGHT* get on a plan but you can NEVER falter, not once, or they will dump you right off of it. Most of the time getting on such a plan will mean a significant lump sum up front. They also will not even consider it until the account is already 4-6 months behind.

 

[Zellerscrossing]

Think again**************.it's not that bad

Don't count on it. Creditors don't want you on a hardship program because they lose money. You *MIGHT* get on a plan but you can NEVER falter, not once, or they will dump you right off of it. Most of the time getting on such a plan will mean a significant lump sum up front. They also will not even consider it until the account is already 4-6 months behind.

Ladynred--

I respect what you have said because I don't know your past experiances or where you obtain your info. However, I am a debt collector and set anywhere from 1 to 20 of these up a day. So if the original poster of this thread (telenator) read that reply, please consider the following:

Don't count on it. Creditors don't want you on a hardship program because they lose money.

1. Creditors (at least the one I work for) are not concerned with losing money, AT LEAST not in this fashion. Yes, they will hunt you down and pursue your money with a vengence, but if you show the willingness to repay, and have a good reason such as medical/injury they are more than happy to set something up. The represenitive usually gets an encentive for doing the arrangment, and the represenitive is who you would be talking to. That means setting you up on a program that will assist you means a bigger paycheck for them. Plus, depending on the level of delinquency, the creditor will become more concerned with getting the balance in full rather than it being written off, or sold to another collection agency. It's at this point (usually 3+ monthes past due) when you could probably be set up on an arrangment for something, even as small as a papercut. If the creditor didn't want you on a hardship program, they would not be available.

You *MIGHT* get on a plan but you can NEVER falter, not once, or they will dump you right off of it.

2. The only thing you have to worry about with arrangments are automatic check drafts. You must have a check draft in for every billing cycle (about 28-30 days like a regular payment) If the payment is not received during that billing cycle, it drops the program because well......payment wasn't made in accordance to the program!! Hence, this is why we would set it up automatically, so you just have to worry about having the funds in the account. Plus, we give the dates when the money is to be taken, and letters are sent out to remind you to have the money in the account. It's actually easier than paying on your card with out a program! If you happen to get dumped off, we will generally re-instate the program, unless it was for non sufficient funds. If nothing else, we can almost always set you up on another program.

Most of the time getting on such a plan will mean a significant lump sum up front.

3. NEVER**************NEVER. In fact, this wouldn't even make sense! If the customer can pay a lump sum, we wouldn't offer a payment arrangment. In fact, many of our arrangments defer the first monthes payment, meaning you don't even have to make the payment for a month. The next month is generally only a portion of your regular ammount, because after all, your having a hardship and we are giving you some time to get through it.

They also will not even consider it until the account is already 4-6 months behind.

4. All it takes is one day. If the account is current, you probably don't need the assistance, but we are still able to help you at that point as well. If not, the second you go past due, we have arrangments available.

 

[Ladynred]

3. NEVER**************NEVER. In fact, this wouldn't even make sense!

Never say never...
Well, I beg to differ. I've been on that rollercoaster ride and they most certainly DID demand a large lump sum to 're-age' the account up front to 'get started on the program'. The consecutive payments were 'normal' (if you can call it that), but it was still 2-3 times the regular monthly payment to begin with. Maybe the creditors you work with are not quite as greedy as MBNA.

If you happen to get dumped off, we will generally re-instate the program, unless it was for non sufficient funds. If nothing else, we can almost always set you up on another program.

MBNA flat out refused to put me back on that or any other "program" and they could care less that the reason I missed the payment was because I'd been laid off and have this odd habit of EATING !

As for the automatic drafts, that is a dangerous proposition and one I would never agree to, at least not on my regular account. If they suggest this, open account in some other bank that will ONLY hold the amount that they are due. Many people have reported creditors dipping in for more than was 'agreed' and at times that were NOT agreed to. A separate account is just a prudent move.

4. All it takes is one day. If the account is current, you probably don't need the assistance, but we are still able to help you at that point as well. If not, the second you go past due, we have arrangments available.

Again, I beg to differ. Many, many, many people who try to get on such a hardship program are categorically REFUSED if the account isn't at LEAST 3 or 4 months behind and the creditor is looking a charge-off. Perhaps the difference is that you are acting as a middle-man, who knows.

Creditors (at least the one I work for) are not concerned with losing money,

Wow.. that's a first, a creditor who isn't concerned about losing money.

 

[Zellerscrossing]

....

Ladynred,

I'm starting to get the impression that you are simply a consumer. If this is the case, while you provide strong opinions, you should not be attempting to give advice. We still don't know where our friend 'telenator' banks, so to advise against at least attempting to call his creditor is a bit rediculous.

I don't have much else to say for I can only repeat myself. Of course everyone knows that different companies vary on just about everything, it's what keeps Mcdonalds separate from BK and Blockbuster separate from Hollywood video. There are several different credit issuers, even among the largest including Chase, Capital One, Citi, and it sounds like a pretty bad one, MBNA. I can't blame one for being hesitant about engaging and arrangment if you did indeed experiance the problems you speak of. However, there is nothing remotely close to what you have described where I work.

As far as being dumped off the program you simply shouldn't have missed a payment. When we set up an arrangment, we ask the cardmember "how much would you feel comfortable with, dedicating soley to this account?" this way, as long as the person accounts for items like rent, power, and ya'know....food, there is no reason they should miss the payment. Also, if any date comes up and you won't have the funds available, just call, we can move that date foward. Once again, this is a date that was already agreed upon. Our number one concern is making sure the arrangment is successful. It looks better for the cardmember and better for the represenative. As far as the fear of automatic drafts, I don't know what to say except that every note we type on an account serves as a legal document. That means that if any other ammount was typed, it would be falsefying documents and is a crime. While something like this may happen at other banks, I'd hardly expect it from the large banks listed above. There is no reason to do this either. We set it up for an ammount that will work for both parties. No one has anything to gain by adding a few dollars hear or there. Most cardmembers in that situation don't even have an extra $20 bucks in there account, so to overdraw would simply cause a returned check and the whole jig would be up. On top of this, most arrangments can be set for the payment to be mailed in instead. We discourage this because if something was to happen to the payment (lost in mail, delayed, etc...) it could cause the arrangment to cancel.

Creditors looking for a charge off? That is what we are trying to avoid here.

As far as my quote "Creditors (at least the one I work for) are not concerned with losing money," next time you take something out of context, at least remember to remove the comma so the reader may believe that I actually meant that for a single second.

TELENATOR-- I hope you are still reading this thread because I was simply hoping to help you out. Call your creditor, if they offer a program in accordance to what I've put, go for it. If you are dealing with a creditor that Ladynred must have dealt with, I agree and think you should turn and run, however I hardly doubt that is the case. All you have to do is make a 5 minute phone call, and ask for one. I wish you the best of luck.

 

[Ladynred]

I'm starting to get the impression that you are simply a consumer. If this is the case, while you provide strong opinions, you should not be attempting to give advice.

There is NO requirement that one be an attorney to answer posts here. I think you'll find that the majority of people giving answers are "simply a consumer". I've been here a LOT longer than you have and I do not fabricate 'experiences' and I DO have experience with a lot of the troubles people come her looking for. In other words - been there, done that, I know what a lot of it is like.

I participate in several other credit-related forums and I have read THOUSANDS of posts from people dealing with all facets of credit problems, collections and bankruptcies. The instances of which I spoke are FAR from isolated.

As for my 'missed payment' on the MBNA 'plan', I made the payment arrangements based on HAVING A JOB. Under that assumption of being employed the 'arrangement' was not a hardship. The layoff came suddenly and without warning to 22 of my co-workers. When you have NOTHING to live on but $1,000/mo unemployment with $750 in rent alone there is absolutely NO ROOM in the fractional budget to do anything but survive, creditors be damned. I'd been thru 2 previous layoffs and my meager reserve funds were still depleted.

Aside from MY experience with the ever nasty MBNA, plenty of people on the 4 forums have related similar experiences with many other creditors, not all were dumped, but they had their share of problems. I'm sure there are companies out there who do not act as MBNA and others do, you obviously deal with one of them - lucky for your consumers.

So.. I'm not going to play tit for tat with you. I've been here a long time and I'm sure as heck not going to go away because some collector with the 'dumb consumer' mindset thinks I don't know what I"m talking about.

 

[Zellerscrossing]

(sigh)

Ladynred,

Often times, it is very easy on forums such as these as to advise someone from your own experiance and out of the blue an argument is started. I see it all the time as I have experiance at many other forums. Before posting to your first rebuttal I did look at your profile and did notice the astonishing over 14,000 post. Other than just finding this forum, the reason I do not have the same number of replies is simply because I do not post unless i'm 100% sure what I'm talking about. Rather than basing my experiance from being just one consumer, or even talking to a few on the internet, I take my experiance from working at the company seeing the good, the bad, and every experiance in between. While I never mentioned that you must be an attorney to post here, nor that you have fabricated your experiances, I simply suggest that in this particular issue, there are parts where you are simply incorrect. There are many areas of advice that I'm sure you could school me on, but that is why I don't have 14,000 post. I'm not going to share my 10% of knowlage here and there when I can dedicate 100% of it to someone who could obviously use the help.

It sounds like your first arrangment failed because of a second hardship (that is if you saying you were layed off, when you were already on the program). This suggest that the company was already helping your out when you got laid off. A double hardship is definetly a hard one to deal with, but you shouldn't move your frustration onto the buisiness simply because of it, especially when they had you on a program to start. (JUST MY OPINION!!!) Before simply making the choice (even if forced to simply to 'eat') to not pay the next payment, did you attempt to call your creditor and see if they could perhaps defer your payment? You are usually only kicked off programs for miscommunication, otherwise it could have been worked out. Not to say it is your fault, just asking, did you cover your bases?

I definetely don't have the mindset that consumers are dumb. Lets just say that businesses and consumers will always clash. The only time the consumer usually agrees with the business is after becoming employed, because you see first hand the misconceptions plus you see where all the cost goes day in and out. One thing you must constantly train yourself to do is to see as the consumer, don't get caught up with company pride. While it's fantastic to have pride in your job, it's never worth it to lose the consumer. Even if I went to Mcdonalds and had a bad experiance, and then read about it 20 more times on the net, I'm not going to start saying "big macs are always made bad" or "don't go to Mcdonalds" However, if I was the manager there for a number of years I may be inclined to submit replies to these types of complaints with possible explanations of why it was bad that day, what you can do to get it fixed, etc... Once again, this is not neccessarily in contrast to you, as a consumer in these areas if I experianced a way to help another, I could put that advice down as a suggestion.

With all this said, please understand that I mean no disrespect to you. My goal remains the same to give 'telenator' the advice he deserved. Like I already mentioned, all he needs to do is call and ask, if he has a bad experiance, turn and run (THIS IS ME AGREEING WITH YOU!!) if not, i'm glad he was able to get the help.

If you have any more greivences, I'm sure you'll get the answers in previous post, if not, don't hesitate, after all, for every tit, there is a tat.

 

[Ladynred]

did you attempt to call your creditor and see if they could perhaps defer your payment?

You bet I did, every single one of them, although MBNA was the only one that was a problem at that particular time. I spent the better part of 30 minutes on the phone with those people at MBNA and the only answer that I got was "tough s**t, you're off the program. I even asked for the next level up and got the same 'too bad' answer. With the exception of 2 creditors (out of about 8) they ALL refused to cut me a break of any kind for even 6 months - stop the interest and defer or lower my payment.

For the rest, their answer was that I was not behind so I didn't 'qualify' for any program, despite the situation (yes, I got laid off AFTER I got on the 'program' with MBNA). I had an 'account rep' from WFNNB who LITERALLY told me that if I couldn't pay my bill from my unemployment that I should 'go find yourself a busy streetcorner and make $$ the old fashioned way' to pay his company !!!! That is not a joke and I misheard nothing. I only WISH I'd had that S.O.B. on tape saying that, I was utterly stunned. After I recovered from the shock I told him to go 'f' himself and slammed down the phone. I hope the azz got fired.

That is the kind of callous, rude behavior that really pisses people off. I realize its BUSINESS, but business can't survive w/o the consumer and if the consumers get pissed that business could suffer for it. I read far, far too many horror stories of people dealing with in-house and 3rd party collections to believe that all these companies are 'nice' or have an single ounce of compassion. I don't really believe at all that they care about whether or not an account goes to charge-0ff, they get their tax break for the write-off, then they get paid when they sell the account. The credit card companies are salivating just WAITING for people to be late even once so they can jack your rates to the sky and bury you with incessant and usurous fees . If people can't pay their NORMAL payment, where is the LOGIC in thinking they can make an INFLATED payment ?? Simply put, there is none, they are GREEDY. The industry made $34 BILLION in profits last year, about 90% of which was from fees and jacked interest rates.

The bottom line is.. they don't give a rat's patoot about people. Gee.. too bad you had a massive heart attack and you have $200,000 in medical bills.. now where's MY money ???

The 'good' creditors and the ethical collectors are not the ones we hear about here or elsewhere. I'm sure they exist, as you say, but they seem to be a minority.

 

[Zellerscrossing]

If it's one thing I hate, it 'performance pricing'. Someone is having a hard time and what does the creditor do, increase the apr! Even I hate that, no matter what my stance on the situation.

It sounds like you had not only bad, but inapropriate service from MBNA. Occasionally i'll have a cardmember tell me about how nice I am and explain how the last rep was just rude and I usually give the same advice to the cardmember: "hang up on 'em!" No, it doesn't bother that rep, but you do deserve better, and anyone that wouldn't even transfer you to a supervisor needs to be fired.

While we started this converstation about payment arrangments, I hardly approve of big business. Its the same thing as gas prices. What did the exxon guy get when he retired?.....400 million, or was it billion, oh well, just raise the price at the pump another dollar right!

I wish I worked for MBNA so I could apologize on there behalf, however I don't, but shop around, when you find where I work, hopefully you'll know it by the good service. Good luck!