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New Member
Posts: 1
Registered: ‎12-13-2011
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Hit rock bottom with my credit card debt, would appreciate advice.

[ Edited ]

Hi.  I'll try to keep my story (which is probably too common) to the point:


1)  Had a decent job, and lots of cards with high limits.

2)  At beginning of 2009 I went through major life changes (divorce, loss of job, and general irresponsibility) and ended up maxing out cards.  Gained employment again at end of 2009, but at lower salary.

3)  In 2010, started running behind on payments, and finally set up debt management programs with all three cards.  Haven't had access to a line of credit since 3/2010.

4)  In mid 2011, I fell behind on DMPs with all cards, due to more unexpected espenses (and my own bad habit of sticking my head in the sand when I'm know I'm in trouble).

5)  One card has been sent to collections, and collector is threating legal action (of course).

6)  At least one other card is willing to work out new DMP, not sure about other (still need to call them).


Some basic facts:


1)  I know my credit score is already in the toilet, and I've given up on it, for now.

2)  My total outstanding debt is about 50% of my yearly income.

3)  When I was on the DMPs with all cards, my total monthly payment on all cards was about 20% of my monthly income.  When I crunched the numbers I felt I could make it work in my budget, but, of course, I was always short.  And the unsecured debt gets paid after everything else (rent, car payment, etc).

4)  Every card has offered to settle.  But I've never had enough cash on hand to pay the settlement.  I'd gladly settle at this point.

5)  It goes without saying that all my cards are closed out, and I have access to zero credit now.  If I ever manage to get another credit card in the future, I'm handing it to a third party to take care of.  

6)  I have a new wife and child now, and their long term well being is my number one concern.


My primary goals/concerns at the moment:


1)  To stop panicing and freaking out. Smiley Happy

2)  Avoid any legal action.

3)  Avoid throwing away any more time or money on DMPs, if I'm just going to end up delinquent again.  I have just enough money set aside at the moment to jump-start at least one DMP again, and get the collector to at least drop the legal threats.

4)  Ideally, I'd like to settle each card, and be able to pay off that settlement in installments.


My questions:

1)  Who should I call/contact first, so I can stop freaking out?  :-)

2)  Should I conisder bankruptcy?  I'm afraid my income, or ratio of debt to income, is such that chapter 7 might not be realistic.  And if there's an option that will have a less severe affect on my credit, I'd like to pursue it.  In in all honesty, I guess it's a matter of pride.  And with one card already charged off, it seems a good bit of the potential damage has already been done.

3)  Are there companies that operate like a DMP, but where I make payments on a settlement amount, rather than total amount?  IE, where I can call and say "Cards X and Y have offered to settle, but I need someone to front the money so I can pay it off in installments?"

4)  What are some names of some reputable DMPs?  I've searched the forum, but it appears you're not allowed to mention names.  I did see a lot of positive mention of CCCS, but I'm not sure they're even around anymore?  Feel free to PM.

5)  What are my options with the card that's been sent to collections?  I'm assuming any sort of DMP is out of the question there, though I expect I can probably settle.  But if I go the bankruptcy route, I don't want to be throwing away even more money there, at the moment.


Without any further advice, I'll probably try to settle the two cards that aren't charged off, working out some sort of payment schedule either with the cards or a third party.  I'm really at a loss on what to do with the card in collections.  I'll most likely throw them the lump sum they want before they'll setup a payment schedule, so I can at least stop worrying about legal issues over the hollidays.


Thanks in advance.  Any and all advice would be greatly appreciated.  I know I just dumped a lot out here, and I know I am the worlds biggest idiot to let myself get into this situation.  Smiley Happy




Regular Contributor
Posts: 159
Registered: ‎09-02-2010
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Re: Hit rock bottom with my credit card debt, would appreciate advice.

Dont have much advise to offer you except this: Dont beat yourself up or keep telling us that you messed up and your sorry for it. Damn near all of us are here because we all did the same thing, to one degree or another, that you did. We all have our stories and our reasons. The great thing about this place is that there is no need to defend or give excuses for your past. The fact that you are here, like the rest of us, shows that you are taking the first steps to fix what is broken by educating yourself.


So, dont worry that anyone here is judging you. We are all in the same big glass house, and theres not a stone to be found. Smiley Wink


4/6/09 EQ 555 TU 498 EX 553
9/3/10 EQ 590 TU 566 (Just now starting the rebuild)
9/11/10 EQ 610 TU 627
10/21/10 EQ 625 TU 660
12/08/11 EQ 681 TU 648 EX 667
2/13/12 EQ 677 TU 658 EX 675

From 9/2010 to 2/2012 I have gotten $44k in available credit, and closed on my first home 12/23/2011. All was made possible by the people here. Stay with it, it is possible!
Community Leader
Epic Contributor
Posts: 29,752
Registered: ‎03-19-2007
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Re: Hit rock bottom with my credit card debt, would appreciate advice.

I would suggest that you first list each and every debt, and determine its associated statute of limitations for legal indebetness.  If the SOL has expired on any debt, it would not be my focus for payment. 


Bringing of legal action against you on those debts that are not time-barred would not be the end of the world.  If that happens, make sure that when you go to court, you bring a full accounting of your current financial status.  If judgment is found against you, the judge will consider your ability to pay in any court-ordered execution of the judgment.  Get your financial records in order now, both to determine your SOL status, and prepare for the contingency of legal action.


As for how to avoid legal action, I know that you have tried the services of debt consultants, but a good one might be able to provide some alternatives.


Established Contributor
Posts: 905
Registered: ‎07-25-2008
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Re: Hit rock bottom with my credit card debt, would appreciate advice.

HeadInTheSand wrote:

Thanks in advance.  Any and all advice would be greatly appreciated.  I know I just dumped a lot out here, and I know I am the worlds biggest idiot to let myself get into this situation.  Smiley Happy




You won't be judged here for your credit "Boo Boos" just be honest and you will get the


best help and advice anyone could ask for. 


We have all done some things in our lives that I am sure we aren't proud of


look at my starting scores you can see I was a big dummy but the fact is


your here now trying to fix your mistakes as the rest of us are, anyone can make


a mistake but it takes a bigger person to admit it and then fix it!!!


Starting Score: 377EQ/350EX/400TU As of 11/2011
Current Score: 620EQ/614EX/612TU As of 01/2013
Goal Score: 700+ across the boards
Valued Contributor
Posts: 1,548
Registered: ‎10-25-2011
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Re: Hit rock bottom with my credit card debt, would appreciate advice.

Look at everyones signiture, we are all there, or we have been there... 


To begin, we do need you to pull your reports from and grab all three....


Make a list (I used Excel) and post it here so that we can see where to begin! Smiley Happy 

My credit journey has completed. I am currently sitting at 800+ across the board.

I started my journey here years ago, and thanks to MyFico, it really is possible.
Senior Contributor
Posts: 3,889
Registered: ‎05-24-2011
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Re: Hit rock bottom with my credit card debt, would appreciate advice.

Hi and Welcome!!


  llecs is a moderator here and he (and others) has written some AMAZING posts about how to batten down the hatches and learn to stick to a tight budget until you climb out of this hole.  Hopefully he will come along and send you the links bc I have no idea how to do that.  I'm kinda not computer savvy.   You can read about the "snowball method" of getting out of cc debt.


I totally know about constantly freaking out and panicking so I just thought I'd send you a positive message that you will get out of the hole, and if you believe the hole is too big, and you can never recover, go see a bk attorney.  The bankruptcy section here has some great information.  You could have the attorney lined up, and only go for it if you get served, but as RobertEG said, judgment aren't the end of the world, JUST SHOW UP IN COURT!! That's where the biggest mistakes happen, people putting their heads in the sand - you need to NOT do that if you get served.





STARTING: 11/24/10 EQ-584 EXP-648 TU04-595
CLOSED FIRST HOME 8/19/11 EQ-630 EXP-691 TU04-653
CURRENT: EQ-701 EXP-??? TU08-720
Super Contributor
Posts: 5,821
Registered: ‎10-06-2007
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Re: Hit rock bottom with my credit card debt, would appreciate advice.

I sent you a PM on the DMP compnay I used.

10/17/2017 FICO: EQ 829 TU 830 EX 826

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