I'll answer your question like I do in these type of posts. Credit Repair Companies (CRC) are not free. They charge you as you pay them to pay your bills. So here goes. Ask yourself. Will I be better off filing for BK in 5 yrs or paying all these closed debts in 5 yrs for 40k. I only use it as an example. I am 4 yrs out from BK. (below) Will your scores be the same using a CRC and start another rebuild in 5 yrs? Or will filing and being debt free, less stress on your life, and start a rebuild immediately once you filed for BK? I wont say yes file BK. Thats your choice. I only lay out what the 2 paths could lead to. Life is short. Its your choice. Good Luck on which path you chose.
Side note: Your siggy needs to be deleted and refreshed. Just type out your stats as you do in a post. The HTML code is way off to work.
@Anonymous wrote:If you want to go the settlement route you can do it yourself and not pay a company to do it.
@Anonymous OP is already doing that and cant afford it. They asked if their settlements would be lower using a CRC.
#2
You can settle with any creditor. We dont know your yearly income. I was going by what you stated in your opening post. Your having a hard time keeping up. While agreeing with creditors to make payment plans after calling them. Some will reduce the amount owed and set up monthly payments. Some will lower the APR and make payments. And some will just get law firms involved and file a judement for wage garnishment. 40k is a lot of money. Each company works differently. Call who you owe and see what they will do for you to pay your debts. The accounts are already closed. You want to get them paid down because the util on those cards are affecting your score. You'll want to act kinda quick before they sent it to collectors and that will cause even more harm.
@Anonymous wrote:Typically you would stop making payments and after a few months (and save EVERY dollar you can in the meantime) you offer a fraction of the balance owed as a settlement.
My Mom settled my Dad's CC debts after he passed for 30-50% of the balances owed, just before things were sent to outside collection agencies. (She wouldn't have paid them at all, but he had an inheritance pending that my Mom was the beneficiary of and apparently the proceeds would have first settled any outstanding debts in his name.)
Another option is to stop paying (again save EVERY dollar you can) and see who comes knocking (meaning who seeks judgments/lawsuits against you) and if that happens you have some cash on hand to settle. Those that don't come knocking will charge off and eventually fall off of your credit reports. The downside is this keeps the situation hanging over your head and in limbo and your credit trashed for a good while to come.
Not knowing your income or expenses or what you can feasibly put towards these debts limits the advice anyone here can give, but you may want to at least consult with a BK attorney or two so you know how the process works and can weigh it in your options. I will say that I think you can rebuild from a BK just as fast if not faster than going the settlement route.
Why wait that long and not pay. We dont even know if there are any late payments yet. And then public records will be created for the judgements from the lawyers offices and future UW's can see those later down the road. Not a good idea. The OP's credit has already been hit by being "closed by grantor". Settlement payments are in effect. The util is hurting also. Why add to the injury already created by playing chicken with the creditors?
We do agree almost on 1 thing. Get it over with and get a fresh start. Less headaches, no creditor lawyers, judgements, less stress, and as a med professonal. All this stress causes a lot of medical problems. Rebuild will take less time filing rather than paying all this off and starting another rebuild process which will take a whole lot longer to do. You dont want court dates, getting lawyers to fight for you, or hoping some thing falls off. Too risky and it will cost more to hire lawyers to defend yourself cause they do file a judement because they waited to save and then settle. Not great advice.
@Oyiwaa wrote:Hello.... my come to Jesus moment has come.
Over the past 4 years, I've accumulated close to $40K in credit card over 10 cards, with principals ranging from $500 to $5,000.
Though I am still employed, I am able to pay only minimums per month, even after cutting down expenses.
Most of the credit card companies (CapOne, AmExpress, BestBuy, Chase, etc) have already closed my account and I've arrangment some sort of fixed payments with them - which I am having diffulty paying. All other credit cards are at their maximums.
I have considered bankruptcy, but thought I would consider debt settlement agencies to negotiate my debts, and help me settle them.
I am considering enrolling with one of these:
Freedom Debt Relief
National Debt Relief
CuraDebt
New Era Debt Solution
Would recommend this approach? Any other options?
Thanks - Oy
What is your income. How much after paying all your bills do you have as dispoabale income to try and pay these debts. This will help decise which path will be best for you.