I am about $50K in CC. Several months ago I got laid off due to an accident. It took a couple of months for me to get myself back on track. I was not able to pay anything during those months. Before this I had a 690 score, and had never missed payments. Now all my accounts are 90 days past due. I am now gainfully employed with a 120K salary. But now items are in collections !!!
I have no savings, and my cash flow is good for $1500 a month. Collection agencies are sending me settlements for 1/2 the value. I thought of doing a chapter 13 bankruptcy. Should I do that, or should I go to a credit counseling company or hire a lawyer? What should I do??? Please advice.
You should agree to the settlement offers that the collection agencies are offering you. However, get all the agreements in writing before starting to pay. Can you tell me why you want to file the bankruptcy? With debt settlement, your debts get lowered at least by 40-60%.
You need not take help from a lawyer to pay off your debts. The collection agencies are themselves offering you the debt settlement offers.
Your personal details (name, email address and phone number) will be delivered to the company advertised on the Creditmagic after ve agreed to go for the counseling session by filling out the no-obligation form. However, it is your discretion to accept or reject their services.
Not all the creditors/debt collectors agree to trim down the outstanding balances, interests, and fees payable by the consumer.
Consumers working with the debt relief companies can still be sued by the creditors/collection agencies.
Debt relief services may have a diminishing effect on the creditworthiness of the consumer. The total outstanding balance may increase as the additional fees get accrued.
The overall amount saved by the consumer through the debt relief services is considered as taxable income by the IRS.