How to get out of debt

[Anonymous]

Please help! Before we were married, my wonderful husband lost his “white collar” job and fell into hardship financially. (Prior to this, he only had a student loan he was paying off and otherwise perfect credit.) He was quite young. He took out a small loan and used his credit card (without a limit) to cover his needs for some time…expecting things to turn around. Times went from bad to worse and his home was foreclosed…the debt was up to around 20K. He has not used credit since…for approximately 8 years. In order to survive, he turned to carpentry/construction and continues in this to this day. He had hoped to get financially secure and begin to eliminate his debt. However, just a few months after we were married we learned that both of our aging parents were in drastic trouble with their health or finances. To make a long story short, he was never able to pay his debts. Instead, he has been working hard to care for both of our parents, as well as, cover our basic living expenses. He saved their lives. And I am SO GRATEFUL to him, as are both of our parents. No one can begin to know what a hero he has been. He has carried more than I think one man should have to bear, ever.

My husband has lived with painful regret over never addressing his debts…he has a noble heart and has distressingly lived beneath that dark shadow. Just recently, (within months of each other), each set of our parents were given family inheritances which brought total security to their previous physical and financial sufferings. For the first time since being married, 7 years ago, we are no longer caring for them and can finally focus on our own needs! He does not know I am inquiring about this…but I would like to know how best to start so that I can help to alleviate the tremendous burden of his past debt as a single man (we have not incurred debts as a married couple). All I know, so far, is that the SOL in our state is 6 years, so now what? I do not have his credit report, nor do I know if he has any old records of the debts in his current possession…, or what to do if he did? This question is not about clearing his credit report or ignoring past charges. It is about doing what is necessary for him to live with a cleared conscience…by facing what he never was able to do, as he had intended. Please send wisdom and knowledge in this matter, so that he can begin to live in peace. What is the best route to truly erase the debts without costing us a fortune? THANKS!

[llecs]

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@Anonymous wrote:

…but I would like to know how best to start so that I can help to alleviate the tremendous burden of his past debt as a single man (we have not incurred debts as a married couple). All I know, so far, is that the SOL in our state is 6 years, so now what? I do not have his credit report, nor do I know if he has any old records of the debts in his current possession…, or what to do if he did? This question is not about clearing his credit report or ignoring past charges. It is about doing what is necessary for him to live with a cleared conscience…by facing what he never was able to do, as he had intended. Please send wisdom and knowledge in this matter, so that he can begin to live in peace. What is the best route to truly erase the debts without costing us a fortune? THANKS!

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Welcome to the forums!

I'd suggest reading the following:

Common Abbreviations

Credit Scoring 101 - great for knowing what is in your credit score and to see how your score is impacted.

What Steps Do I Take - great for learning the repair process.

and Example letters - PFDs, GWs, DVs, etc.

I recommend starting by knowing what's on his credit report. I also recommend attacking this together as a team. I'd start by pulling yours and his credit reports directly from each CRA, or for free from annualcreditreport.com. The govt' mandates you get all 3 reports once a year for free if you so choose. If your FICO scores are important to you, then I also recommend pulling both FICO scores from here (Experian no longer allows consumers to buy that FICO score).

From those reports, make a list of what debts you owe. I recommend listing them out by the name listed, the amount owed, and the DOFD of the debt. Your EQ report will list the DOFD and your TU and EX reports will usually list a drop off date. Subtract 7 yrs to get a rough idea of DOFD on those two reports. SOL starts ticking off the DOFD and the time a baddie reports (7-7.5 yrs) also goes off of DOFD.

Read the links above. Save up for 100% of the debt payment before doing anything with any given debt if SOL had not expired. You can always work out settlement offers, but if they reject them, then at least you have the $$$ to PIF if SOL had not expired and they wanted to sue. If SOL had not expired and if you don't have the $$$ to PIF if you had to, then wait it out and keep saving.

I recommend tackling the debts from lowest to largest. Don't make multiple payments and get any settlement in writing.

For any paid CAs, send a GW letter asking for deletion.

For any unpaid CAs, send a DV first. If they verify and you agree, then send a PFD. If they agree in writing, then pay it and they'll delete.

For any paid OC accounts reporting poorly (e.g. a CO or an account reporting lates), then send a GW specifically asking to remove that item (e.g. the late, a comment, etc.).

For any unpaid OC accounts that are charged-off, then send a PFD.

For any unreported debts (e.g. not on your CR), then wait it out and take care of the stuff on your report first. If anything comes after you that is inside the 7-7.5 yr CRTP, then you may want to address those too to avoid further report damage.

For the OCs also, keep an eye on age. If any given debt is your oldest or the oldest per revolving, installment, etc., then you may not want it deleted and you may just want to pay it off.

The advice just posted is generic. I recommend listing out a couple debts at a time and posters here are great at helping.

[mauve]

He hasn't accumulated new debt in more than 8 years? 

He could probably call the original creditors and ask.  These items are unlikely to be on his credit reports.  He probably has an idea of who the original creditors are, so I'd call or write to each of them and say something along the lines of "I would like to inquire about the past due balance from ~ (whatever year)" - since you're past SoL, they probably won't sue you (and if they do, the defense is "past SoL"), but it's probably the best way to find out what the items / balances are.

[Anonymous]

Thank you so much for your response. I will try to read through the links you sent over the weekend (and decifer your Abbrev.). Thanks for your advice. We have been a team all these years...I had just hoped to do something for HIM this time - a man who willing cares for everyone but his own needs! I may get back to you on this. Thanks again!

[Anonymous]

Thank you for your response. It is true. He/we have not incurred further debt of any kind. Our lives have been hand to mouth (which included being sometimes in lack) in order to provide for both of our parents these last eight years. We have been determined not to go into debt further...no matter the hardship or hard work necessary to do so! I doubt if his credit report will list these debts either...so your advice about contacting them directly is probably the only way to find out the specifics involved. Do you have any advice on how to go about paying them? Also, the interest must be astronomical - what can we do about that? I don't really know what I am doing . I have simply wanted to help him somehow...he is a man who willing takes care of everyone else's needs but his own. Any further assistance you could provide would be wonderful. I am very grateful!  THANK YOU.

[mauve]

It's past the statute of limitations - I'd ask the original creditors for an accounting of the debt, and I'd pay them the original balance and no interest.  I'm just assuming you're correct about the SoL where you are, so don't take my word for it about the SoL.  If they can't produce an accounting of it, perhaps send them a check for the amount to your best recollection.  They've probably charged off all of that debt anyway - they will have gotten a tax break on the uncollectable debt, so they are ultimately making more than the original balance anyway.

[Anonymous]

WOW! Thank you for that information...it is very helpful to better know how things work. I suddenly don't feel as intimidated by it all . Thank you for your kindness. And for helping me to help this wonderful man. God Bless!