On my way back from credit problems

[Anonymous]

I really appreciate this forum, such great information.  It has really given me the courage to face my credit challenges and search for solutions.  Long story.....

I had 2 investment properties that a "friend's" property management co mismanaged and I neglected to pay attention to the details, thus I am having to rebuild everything.  In addition to that my business in the financial services industry really suffered & I was in over my head...drowning in debt & real estate ;(

I just finished a short sale on my 1st property 7/09..YEAH!! But it is showing as "derogatory, bad debt collection/chargeoff, paid charge off, etc."  Is there anything I can do to show that it was not a foreclosure? I actually sold the property based on the value in the market now. Much lower value from 3 yrs ago...

I am working on a short sale for this last property now & it's taking forever.  I have tried loan mod, getting renter, etc.  I just want to get out of landlord business.  Is there anything I should do different this time?  Both of these mortgages have "terrible" payment history and both properties had 1st and 2nd mortgages.

In regards to CC I tried to negotiate before hand since I had 20 yrs of excellent payment history the CC co's told me NO they couldn't help me until I fell far behind.  In 11/08 I fell way behind in everything!! I was able to work out payment arrangement with 2 of my CC.  The accounts are closed but they are reporting as "pays as agreees"  Do I just keep paying and eventually my score will improve?

However 3 of my other CC accounts have now CO & rept derogatory.  Before I agree to make any further payment arrangements, how will making payment arrangements/settlements affect my credit?  Accounts just went into CO status in 3/09 and 6/09.  These 'agencies'  claim to be working on behalf of my OC. 

Help please I desperately want back in the 700 club...

[RobertEG]

Once a CO posts, paying it wont remove the CO, and it will continue to affect FICO scoring for 7 1/2 years from the DOFD on the OC account.

Entering into a payment agreement will forstall the further chance of them suing you for the unpaid debt.  But it wont result in removal from your CR unless the terms of their agreement includes acceptance on their part they will delte the CO upon full payment.

[Anonymous]

Entering into a payment agreement does not necessarily keep them from suing you.  It has happened often.  But you would have proof that you have been paying by their terms if they did.

[RobertEG]

If the creditor agrees to payments terms, and you are complying with them, I see no way any court would ever award judgment for contractual debt default on payment that has an agreement of compliance entered into between both parties.  That is a legal contract.

[Anonymous]

I did not say the creditor would win, I did state a payment plan would not stop them from suing. 

It has happened.

[Anonymous]

Thanks so much for the response.  I'm not sure I understand.  The OC has CO'd the accounts, these "alleged" CA are not showing on my CR.  Is my next step to ask them to DV or is it too soon? Agreeing to payment terms may not be so advantageous since it's on my CR for the next 7 yrs.  If I don't agree then these CA's may sue me?? Just trying to make the best use of my $$ as I work to regain grounding.  My income has decreased substantially but things are picking back up.

[Anonymous]

Any strategy on getting them to agree to delete the CO?? BK on records for 7 yrs as well is CO just as bad affect on CR?

[Anonymous]

---

Quantum2470 wrote:

I just finished a short sale on my 1st property 7/09..YEAH!! But it is showing as "derogatory, bad debt collection/chargeoff, paid charge off, etc."  Is there anything I can do to show that it was not a foreclosure? I actually sold the property based on the value in the market now. Much lower value from 3 yrs ago...

Does it show as foreclosure? Or just a paid charge off? I believe it seems to be reporting correctly. If what you are worried about is future potential creditors seeing it as a foreclosure, then I would say your option would be to place a statement on the account with the CRA stating it was a short sale not a foreclosure or just explain it to your potential creditors. 

I am working on a short sale for this last property now & it's taking forever.  I have tried loan mod, getting renter, etc.  I just want to get out of landlord business.  Is there anything I should do different this time?  Both of these mortgages have "terrible" payment history and both properties had 1st and 2nd mortgages.

In regards to CC I tried to negotiate before hand since I had 20 yrs of excellent payment history the CC co's told me NO they couldn't help me until I fell far behind.  In 11/08 I fell way behind in everything!! I was able to work out payment arrangement with 2 of my CC.  The accounts are closed but they are reporting as "pays as agreees"  Do I just keep paying and eventually my score will improve?

Yes, just keep paying. Once they are paid in full, I would try to GW them. Or if you can come up with lump sum to PIF now, you might negotiate a GW with them, where you PIF in exchange they remove the negative marks. However, if these are 20 years old, if it were me, I would just keep paying each month and leave them be. How severe are the lates reported and when are the lates? 

However 3 of my other CC accounts have now CO & rept derogatory.  Before I agree to make any further payment arrangements, how will making payment arrangements/settlements affect my credit?  Accounts just went into CO status in 3/09 and 6/09.  These 'agencies'  claim to be working on behalf of my OC. 

Are these the only accounts that a CA are contacting you on? Does the OC still own the accounts?  Can you PIF or offer a lump sum settlement? You don't want these CA to report on your report if they aren't already. If the OC still owns, your best bet would be to work out something with the OC to repay the debt and where they pull the account from the CA and leave them out of it. 

Help please I desperately want back in the 700 club...

---

[Anonymous]

---

Quantum2470 wrote:
Thanks so much for the response.  I'm not sure I understand.  The OC has CO'd the accounts, these "alleged" CA are not showing on my CR.  Is my next step to ask them to DV or is it too soon? Agreeing to payment terms may not be so advantageous since it's on my CR for the next 7 yrs.  If I don't agree then these CA's may sue me?? Just trying to make the best use of my $$ as I work to regain grounding.  My income has decreased substantially but things are picking back up.

---

You should DV the CA within 30 days of getting the initial letter from them. 

If the CA owns the account or the OC gives the CA permission, they can sue you as long as it is within SOL. Anytime you are dealing with a debt within SOL, sometimes there are more important things than negotiating the removal. If they were to sue and win, you'd have the judgment on your report, along with the OC reporting, and more than likely the CA reporting. 

[Anonymous]

So let me make sure I'm clear....

The OC has charged off the accounts & that's what is showing on my CR.  I guess the OC did that so my "bad debt" is no longer on their books.  The CA are not yet reporting and they claim that they are acting on behalf of the OC.  How do I find out who really owns the debt?? I don't want to set up payment plan with CA that doesn't have any authority to collect this debt.  The 30 days has passed on 1 of the accounts, can I still request DV?  I understand that they can sue since the DOFD was 12/08 and accounts CO'd maybe in 04/09, SOL in IL is between 5-7 yrs..I think.  I'm wondering if BK may be a better route or if repaying it in the long run is my best bet for my CR.

Thanks for your help.