Need help with credit card debt, unsure of charge off

[NiaX29]

Hello.

I have only had one CC in my life and I had to use it more than I had planned. I was not able to make anymore payments on in in 2006 when I lost my job at the time. I have not contacted this company since 2006 when I notified them of the job loss. I got letters from them and collection agencies, and calls too. I am aware of the SOL but something doesn't seem right.

I was recently contacted by the company about an update to my account. Because I have had my identity stolen the letter was raising a red flag. After speaking with someone in the bank dept of the company on 2-8-12, I asked about the debt. Specifically asking if even this call will bring this debt back to life (in your terms - re-setting the clock).  The rep said it was charged off and that they don't own it anymore, and that I was eligible to apply for new services and credit with them. Due to some other questions I had, I was told to call back another day to speak to that dept.

I called the dept today and I had to be routed to the Corporate collections dept and had to speak about the debt. The rep in this dept said that the rep from 2-8-12 was flat out lying. That the debt is still owned by them, and that I could be barred for life from ever being a member with this company.

I am like any typical CC debt holder... I want to be able to accomplish the American Dream, and not screw folks over if I borrowed money. But if I am not sitting on stacks of money what can I do? I was making payments before I lost my job.

What can I do? Does SOL work in this situation? I don't know if telling the company would make a difference in getting help, but those that are members should know who I'm talking about from certain things I've said.

Please help me. I'm worried that I will be living a life of paying more for everything due to this.

Thank you.

[kjm79]

The debt is yours as long you it goes unpaid.  SOL means IF they sue you then you have an affirmative defense as to why they can't sue you.  That doens't mean the debt goes away, you charged it, it's yours and the decision to pay it is yours at that point.  A company you've burned in the past doesn't have to extend you credit again.  Many members who have had success with paying off old creditors and then getting credit from the same company at a later date. 

I personally had a JCP card that was included in a 2004 BK.  After the BK discharge I re-applied and was approved.  But that's going to vary from lender to lender and some may require that you pay what you owe, even if it is out of SOL.  But do becareful.  Making a payment can re-start the clock and make you legally obligated to pay the debt again. 

You can try getting approved with other lenders.  You might even have to start with secured credit cards.  Rebuilding is a process with a whole lot of speed bumps along the way. 

[RobertEG]

Even when CR exclusion of the adverse items occurs, the OC will still have their own internal records upon which to base credit decisions.  A charge-off is a particularly damaging item, as it is based on the holding by the creditor that they consider your debt "uncollectible."

It might be prudent to wait in re-apping with this creditor until the derogs are gone from your CR, app with other creditors, who wont be aware of them, and establish a period of good credit with others.  Then, if you re-app with this creditor, the established history with others may take some of the sour taste from their mouth.

[NiaX29]

It almost seems like I should've never learned about SOL. What can I do if I can't pay since I don't have extra money. I did let them know and I'm still not in a position to pay anything. So, its just going to sit on my credit report forever until I come into a boat load of money to try to pay on it... I'm trying to figure out what is the whole picture here in what I can do as someone that has accrued debt. I didn't ever want to burn a bridge with any bank so that's why I called and told them like FIVE minutes after I was let go from that job in 2006. If I came into a bunch of money at that time I would have been able to start my payments back up. I never wanted to burn a bridge with this company (they aren't just a bank. they have other services). I really want to take the sour taste out of their mouth.

I understand I can build up my credit with secured credit cards but I have always looked at myself harshly when it comes to borrowing money period. I want to repay what I borrowed. But I'm not in any position right now. So I know its in the "charged off" status, that isn't totally clear on how I should proceed. Also I don't think I stated it, I was living in KY at the time I had the credit card.

I know it seems like I'm asking the same question... but I am not an expert so I'm wanting ALL the info on this type of situation and how I can proceed. If things are still unclear, let me know if I need to state the name of the financial institution. Giving me surface info isn't going to help me because I know nothing more than what I have stated.

Just have some compassion please. Excuse the length. Thank you.

[Anonymous]

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@NiaX29 wrote:

...I know it seems like I'm asking the same question... but I am not an expert so I'm wanting ALL the info on this type of situation and how I can proceed. If things are still unclear, let me know if I need to state the name of the financial institution. Giving me surface info isn't going to help me because I know nothing more than what I have stated.

Just have some compassion please. Excuse the length. Thank you.

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Here are some options (probably not all of them):

1) Work out with them and begin making payments again, to pay in full. This will (check your state laws) remove the SOL defense if they try to sue you, which they might if you again stop paying. This will be best on your consiousness, but may not be best for your credit or your pocketbook. I'm not sure when the account would fall of your credit reports, but the negatives should fall off at ~7.5 years.

2) Same as above, but pay back a reduced amont. They may report the difference as taxable income to you, or sell the difference to another collection agency. Easier on your pocketbook as above, still makes you feel better, and probably same impact to credit report.

1.5/2.5) Same as 1 or 2 above, but also request a PFD, which will remove the account from your credit report. They may or may not, up to them. If they do, your credit should be improved.

3) Assuming the SOL for your state has expired, stop contacting them and request they stop contacting you. Search around here for how to properly do that. It will still report, they can sell the accont to another collector, and you'll go through it again. However, you have a valid legal defense to not pay. You may not feel good about it, and the hit to your credit report will be there for ~7.5 years after DOFD. Might be risky if you have somehow affirmed the validation of the debt, and thus restarted the SOL.

4) Flat-out dispute it. Probably won't do you any good in this case, because you've already said youself the debt is valid.

Consider your relationship to the company is probably less important than your relationship to your own credit and your own wallet.

[MarineVietVet]

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cassembler wrote:

4) Flat-out dispute it. Probably won't do you any good in this case, because you've already said youself the debt is valid.

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There is nothing to dispute if you know and confirm the debt is valid. Only inaccurate information should be disputed.

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".