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How do i deal with a car charge off?

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ca21rese



Joined: 24 Nov 2008
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Posts: 3



191 Magic Points

Subject: How do i deal with a car charge off?
 
Posted on Mon Nov 24, 2008 1:05 am  

2 years ago, I co-signed for a car for my ex. After I found evidence that she is an identity thief, she fled out of state with the car and stopped paying for it. She and the car are nowhere to be found. A week ago, I got a call from a collection agency trying to collect 36,000. Obviously, I didn't have that kind of money so they bargained down to 23,000. I told them I didn't have that money either. The account has been charged off since 2007. My friend told me not to pay it since it's not my fault and just let it be but at the same time it is since I am a cosinger. Two things I want to ask: 1. Since it's been charged off and can't pay what the collection agency is asking for, should I just wait for them to take me to court and let the judge decide my fate? and 2. Is it true that they can garnish my wages if they decide to take me to court? What should I do? Help
fireyone



Joined: 26 Feb 2008
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Posted on Mon Nov 24, 2008 1:11 am  

First of all never co-sign for anyone whom you think will ever take you for granted. Girlfriends, boyfreinds..I hear alot of this. I am thinking that you will be responsible since you are the co-signer. More than likely when they can not get her to pay they will come after you since they can find you. Garnishment varies by state and is definaltely an option for them..Is there ant way you can run the plates or anyhting to find the car and driver?
ca21rese



Joined: 24 Nov 2008
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Posts: 3



191 Magic Points

 
Posted on Mon Nov 24, 2008 1:16 am  

The police are also after the car since she used someone else's money to buy it. There is no way retrieving it. I have reported it to the auto finance and even gave them a case number. I assumed after that they reported it to the credit bureau as a loss. I have learned my lesson since: trust NOBODY, especially with money matters.
anthony

anthony

Joined: 31 Jul 2006
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Posted on Mon Nov 24, 2008 5:35 am  

Since you have co-signed the loan agreement, you are also responsible for repaying back the debt. Now, since the account has already been charged off, it does not necessarily mean that you need not repay the debt. In fact you are still responsible for the debt and the creditor can sue you to the court and bring judgment against you to recover the debt. If they bring judgment against you they can even garnish your wages till the time the debt is repaid in full. However, they cannot garnish your full wage as per the Federal garnishment laws. It varies from state to state but for most states, the creditor can garnish maximum of 25% of your total wage and continue to do so every month till the debt is repaid in full.
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Anthony Marx

A positive attitude is not achieved by turning a blind eye to the negative, but rather by responding to every situation in the most positive way possible.
carol

carol

Joined: 27 Jun 2006
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Location: Los Angeles, California


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Posted on Mon Nov 24, 2008 5:46 am  

Yes, Anthony is right. If the creditor brings judgment against you they can garnish your wages. However, there are four states in US which does not permit wage garnishment. They are Texas, North Carolina, South Carolina and Pennsylvania. If you have signed the loan agreement in any of these states, your wage cannot be garnished. However, you can also come to a repayment agreement with your creditor and pay off the debt through a repayment plan. I think that it will help you.
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Mary

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Posted on Tue Nov 25, 2008 11:42 am  

Since you do not have the money to repay back the debt as you say, you should not send any debt validation letter to the CA right now and wait for their action first. If they ask you to repay the debt before the SOL expiry in you state, you can ask them for a discount on the outstanding amount since the debt is not in your name alone. Moreover, if they send you a court summon, file a response to the summon and wait for the court date where you can defend yourself. Although you are also responsible for the debt, since you are a co-signer, you may not be required to pay the entire amount. However, Pennsylvania wage garnishment laws do not allow garnishment of wages to repay off the debt and so does state wage garnishment laws of Texas and N and S Carolina.
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fireyone



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Posted on Tue Nov 25, 2008 12:12 pm  

Thats good to kow. I don't think the co-signer should be responsible for paying back an entire debt. I also think there are people out there that take co-signers for a free ride. It should be a rule that they have to take every known avenue to collect the debt from the first person before pursuing the co-signer.
So Mary, if yo send a debt validation letter that could cause them to seek action? That does make a lot of sense. They would see that you were interested in the bill and start the collection process. I usually tell everyone to wait for that especially if they are close to the SOL.
ca21rese



Joined: 24 Nov 2008
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191 Magic Points

 
Posted on Tue Nov 25, 2008 2:22 pm  

I was really close to filing bankruptcy because of this mess. I agree with you Mary. I feel that I shouldn't pay the whole amount even if they gave me a 50% discount. The creditor wanted the whole amount or I have up to 12 months to pay the whole thing. I told them that deal is ridiculous. That's for the judge to decide.
carol

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Posted on Mon Dec 01, 2008 4:37 am  

Yes, if you do not in a position to repay off the debt, you can wait for the creditor or the collection agency to sue you to the court. In the court, you can ask for debt validation and you will get another one month in hand. If you can arrange money within this period, you can pay off the debt and settle the case outside the court. However, if you cannot arrange money within the period, you should be present before the court and explain that you are not alone responsible for the debt as you are only a co-signer. The court may give judgment for 50% of the debt and may order for garnishment of you wages.
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Justin

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Posted on Mon Dec 01, 2008 4:54 am  

You can always wait for the creditor to react first. Now if they bring judgment against you to garnish your wages, as per the Federal laws, they cannot garnish more than 25% of you wage. The remaining portion of your wage must be kept for your necessity consumptions. Moreover, as mentioned by carol earlier, they cannot garnish your wages if you stay in any of the four states as mentioned.
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Tracy
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Subject: Wage Garnishment
 
Posted on Thu Dec 04, 2008 5:30 pm  

After your wages have been garnished by an agency and they charge it off, can the same agency then turn around and garnish your wages again?
anthony

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Posted on Fri Dec 05, 2008 11:40 am  

Hi Tracy
Your wage can be garnished till the time the debt has been repaid in full. For garnishing your wages, the creditor needs to obtain a judgment against you and deposit a copy of the order with your employer every month, one week before you get the paycheck and the maximum amount that can be garnished is 25% of your wage. Now once it has been paid in full, they cannot garnish it again. But if your debt has not been repaid in full till date through garnishment, the creditor can garnish it again till the debt gets repaid in full.
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Anthony Marx

A positive attitude is not achieved by turning a blind eye to the negative, but rather by responding to every situation in the most positive way possible.
Mary

Mary

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Posted on Fri Dec 05, 2008 12:06 pm  

Yes, Anthony is right. Moreover if your account is charged off, it does not mean that you are no more required to pay off the debt. Even if your account is charged off, and the Statute of Limitation on the debt has not yet expired then the creditor or the collection agency can bring judgment against you to garnish your wages. However, there are 4 states where wage garnishment is not possible. They are PA, Texas and N and S Carolina.
fireyone



Joined: 26 Feb 2008
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130 Magic Points

 
Posted on Fri Dec 05, 2008 5:18 pm  

I think this is a big common misconception to people new to the credit collectios world. Most will think that since an account is actually charged off they are no longer responsible for paying back the money. In fact usuallly that is when the ruthless debt collectors get into the ball game is when the debt is actually sold off to one of them to collect.
Kaori
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Subject: CvPxCdfEkMNAzGQ
 
Posted on Tue Oct 30, 2012 5:19 am  

Yes, of course they can take you to court over this.What does that mean? Well, it means you need to go to court and try to work out a paneymt plan with them. Do NOT just not show up. That is the worst thing you can do.You can also try to settle this out of court.You can also demand that they validate the debt.You can do many things. Research this topic and the topic of credit repair. You do have rights and it will make it a lot easier on you if you know your rights!

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