Question about collection notice

My mom just sent me a collection notice addressed to me but at her address (where I have not lived for 29 years) telling me I had a Chase bill of over $15,000. It is completely wrong as I took out a second loan years ago and one of the conditions was to have my Chase bill paid off.

My dad has the same name as I but he hasn’t lived at that address for over 30 years. My question is: should I write a letter to the collection agency telling them I don’t owe the money or ignore it as they sent it (technically) to a wrong address.

Thanks for any advice you can provide.

You may chose either way, it could be a phishing trip some collection agency is on. Here is a link to http://credit.about.com/od/debtcollection/qt/validationltr.htm about making them prove you owe the debt.

Someone posted a week ago or so where the collection agency sent the bill to her because the spelling of her name was very close to the original.

You may also want to look at the Statute of Limitations. Remember though, anything that smells like you agree to the debt could restart the clock.

Also, if you have proof you don’t owe the money then gather it together and respond to get yet another thing rocking on the overhead shelf out of the way. You truly don’t owe this money then this is a battle you can win, avoidance will just drag out the pain when you can get this cleared up. If you’re Dad owns the house or part of it then consider that your credit problems might become his if you’re not careful.

“IF” you have not already, it is time to start digging in and cleaning up your credit report. Mary Hunt’s book Debt-Proof Living chapter 11 Solving the Deep Dark Mystery would be a good place to start. This book is free at the library. While you’re at the library place a hold on or check out a copy of the Nolo Press Credit Repair Kit. You do need to get your credit report cleaned up. Even though you have credit problems you can still clean up the false information and get a good idea of who is gunning for you. It is nice to know who is coming after you. If you have had many years of problems there are usually battles you can win.

Start by cherry picking the easiest ones then work to the harder ones. An Attorney is usually not necessary it just takes some persistence and politeness on your part. Keep in mind most the people you’re talking to and addressing letters to are just doing a job to feed their families and diplomacy is key to getting the help you need. Both books I mentioned have sample letters and battle plans. It is better to be proactive then reactive since you will be in control of the timing that way.

We have all been in a tight fix at some point

Hey, we have all been in a tight fix at some point in our life so I can understand what you are going through.

Has your debt gone to a collection agency or is it still in house?

Regardless the collector’s job is to secrue the funds and will tell you anything they think will scare you into immediate payment. Depending on if this is a collection agency or an in house collector can make a difference.

First stop talking to them. They don’t care what you have to say or what your situation is. As far as they are concerned you owe them and they want it now and really don’t care if you rob a bank or go hungry or loose your house as long as they get their money NOW!

Second you need to determine your state laws on debt and get yourself a good read on the FCRA and the FDCPA. These will come in handy during your next few years of debt settlement and credit repair.

I started by reading ALL past posts from this blog… took me awhile but I learned alot! I still have a few questions. We are able to make all our payments with some extra but i would love to see us debt free. We have 14,000 in cc(between 2) one with 7.9% and the other 8.9% van loan of 15,000 4.4% and home equity line of credit of 11,050.00 with 0 interest until 11/06.93,000 left on home. We have just over 3,000 in savings.

What is the best way to start paying everything down? I pay extra on the home but was wondering if going after the van first will be better? We are hopping to move in 2 yrs. I know to get rid of the cc balences first but do I pay all our extra to one or split it since the interest are almost the same? We have stopped using them and are collecting recipts for the month to see where our $ goes. And do I keep adding to savings or go straight to the debt? Any help would be great!

Sounds like the Collection Agency is in violation

You don’t say what state you are in, so it’s a little hard to get specific.

First off, it sounds like the Collection Agency is in violation, or running close to violation, of the Fair Debt Practices Act … don’t succumb! Refer them to the CCCS, if they don’t like it, tough! CCCS is there for a reason, and their reason is to help with unsecured debt, which a credit card is. Keep in mind, they are right, they probably don’t deal with CCCS, but creditors do; and there is nothing to say the creditor can’t and won’t pull that account out of debt collection once CCCS sets up your plan.

Send the Collection Agency a letter advising of your participation in CCCS (give them the company, name, ID#, address and telephone of CCCS); tell them all future contacts should be with them. Also tell them no further phone contacts are permitted with you or your husband, they must only contact you via letter at your home per the Fair Debt Collection Practices Act (Google the link). This should stop the harassment; if not, you can file a complaint against them with the FTC (Federal Trade Commission) and your State’s Attorney General. You can read more debt collection tips on the internet.

Now, for garnishment, as I said, I don’t know what state you are in; but I’m in NY; in NY they can only garnish 10% of your gross and that only after they have started the lawsuit and filed the judgment against you. Not great, but not horrendous either. The fees in NY on $5,000 of debt should be less than $500 (roughly) and would be added to the judgment when filed. Then once the garnishment is filed, you would have 20 days to start making the 10% payments each pay period yourself (usually to a Sheriff’s Civil Office or other legal authority not to the creditor directly). If you default in the payments, then, and only then, is the garnishment filed with your employer and the money starts coming out of your paycheck. This is to give you an idea of the procedure; some states don’t allow garnishment; some states allow more to be taken. It’s important you check in your state as to what is and isn’t allowed.

Next, hold your head up; don’t panic … IT’S ONLY MONEY! Your husband is right, don’t risk your home! Work through this together, you can do it … just keep the lines of communication open between you, work with CCCS, and don’t let the creditors or debt collectors browbeat you!

Now, take a deep breath…

And get started … we are here to help you in any way we can and to give you emotional support … remember that 😉

I got myself into a financial mess

So glad I found this group. I live in Maine. I got myself into a financial mess. My husband got sick and we were not prepared for it.

I maxed out one of my credit cards just to get by for food and bills and pay his medical and prescriptions. One thing led to another and I stopped paying on the card. Months have gone by without realizing so much time had elapsed. Now the credit card put it with a collection agency, $5000. and I was going threw InCharge debt solutions, but the lady at the collection agency says they will not deal with credit counseling services. I have already sent my $290 to In Charge, but have not heard from them regarding the $5000.

This lady was telling me she wanted a hardship settlement of $2500 now and another $2500 in a couple of weeks, or she will start litigations. I only bring home $260 a week. At the time my husband got sick we were both working tons of overtime and money was not as tight. Now after he was sick and missed so much work, our work has stopped all overtime(ouch) What can I now expect? I am so stressed over this I could cry all the time. Another group I wrote to told me my first mistake was to use the card for food and gas when I couldn’t afford to pay for them (no kidding) and to get a second job. I wish it was that easy. I was also going to get a home equity loan to pay off the debt, but my husband said no because the interest was 16.95% and he said he did not want to risk losing the house for a credit card. Our mortgage now is 5.50%

can anyone tell me what to expect now? Will she garnish my wages and will the court cost be outrageous? This is why I wanted to get the home equity loan, but my husband refuses to get it. The credit card is in my name only.

sorry so long

Credit Repair Books

What I would do it start at you public Library. Most have many and you can look at several and find one that fits you.

The Nolo press books are technical but very readable and easy to understand. They come to this from a legal standpoint so they do include the laws but then explain each one in easy to understand ways. They walk you through each step but also give you the detail laws the pertain to each step. The main problem is since laws change these books get out dated fast.

I suggest you go to their web site and thoroughly read the parts on credit repair and if your following that then the books are a good fit for you. I can’t put working links in messages for this group but just snoop around bankruptcy and look for alternatives to bankruptcy there is a nice article and many others.

http://www.nolo.com

But again Use your library first. Most public library’s have online catalogs where you can order books from any branch and have them waiting for you at your local branch. You just walk in present you card they check out the books to you and your out in less then 5 minutes.

Best deals for shopping

y cousin gave me this link when I visited her back in Feburary. It is a site set up by a mom with many children and wanted to figure out how to save the most at the grocery and Drug stores. www.thegrocerygame.com It cost $10 for the first store you sign up for and $5 each additional store.

My cus has three year old twins and let me tell you, it has saved her tons of money. I have saved alot and get alot of FREE, yes I said free stuff. You must be good at cutting coupons to get the best deals. Two papers is even better. Plus there are all kinds of websites that you can print out coupons from.

I live in Florida and print out New York Times coupons as well as Florida Times Union and Smartpages and many more. If you have a little extra money to put towards this and you have a family that goes through alot of food and needed items like shampoo, soap, or what ever, this is for you. Check out the webpage and enjoy saving. I sure have.

Thanks for letting me post this. I think alot of people will really benefit from it.

I also believe the walgrens ads are free thru this program. so if you dont want to pay for it, walgreens is free last i knew 🙂

We are staying until the oldest would start middle school

Our kids are 10,9,6 and 4. So we are staying until the oldest would start middle school. We are looking to buy out of the city so the $ would be less for a bigger house, We live in less than 1200 sq ft now. The girls room is about 10×12. I made their beds to fit in the angled celing…no bunk bed unless it would be in the middle of the room(the room is on the upper level no dormer).

Our basment has low celings so no doing anything with that but storage, and laundry. We are making do with the house and I have added my “home made” charm to it! It is mainly for the kids to go to a better school and for us to get out of the city. We shop at aldi and I make menues(from flylady and saving dinner) We do not go crazy with “things” for the kids….

We don’t have room for all that stuff!! I will say their grandparents spoil them more then I’d like, but they know when they get somthing they need to give up somthing. We are trying to show the kids that spending time together is better then owning tons of stuff and not having anyone to play with.

Trying going to debtproofliving.com

You don’t need the paid service (who needs to spend any more money to save money) but there are lots of public available articles that have great info. Like making your own laundry soap for 1/3 of the price of the cheapest 40lb bucket at Costco. With 4 kids I bet you do a lots of laundry!

Please don’t think it is bad for your girls to share a room. This was customary 30 years ago and kids grew up just fine (probably better). Bunk beds with a trundle underneath works fine even in the tiniest of rooms. Your house is too small is your perception. It’s your attitude that your kids will pick up. They are a mirror. If you have a positive attitude about your life and everything in it including the need to economize your kids will too. Kids who share a room are very much better prepared to deal with sharing in the future. It is actually good for them.

Think of how much easier it will be for them to share a closet with their husband when they get married if they have done it all their lives. My oldest was an only child for 15 years and now that she is an adult she has serious relationship issues because she does not handle compromise and is horrible at letting go a bit because she always had everything to herself. The media including TV pushes us to a standard of living that is well beyond what any child needs to grow up healthy and happy.

There are 20 years between my oldest and youngest. With the oldest Christmas was 4 presents 1) something you want, something to read, something your need and something to wear. She felt she got a lot for Christmas. These 4 presents came from me and her grandparents so that was pretty much all she got. Now my current batch of girls has entirely different expectations about Christmas and we don’t even have TV! With TV access I don’t see how parents today can even come close to meeting kids expectations. The amount of marketing done to kids over the last 20 years has exploded putting ridiculous amount of pressure on parents.

If you ignore these pressures and happily go on with your life your will find your kids are far better off then those Jones down the street in there 1500 square ft house with 3 kids, 3 TVs and 120 channels of 24 hour brain washing which they pay $60 for the privilege. BTW those Jones also pay $100 a month to store things they don’t need and will never use and they still can’t get more then 1 car in there 2 car garage.

I agree with the pay minimum on everything

I agree with the pay minimum on everything but 1 and then put your entire extra towards that. With a little work and excel you can work out what would be the best payment plan for you. Do Google search for Snowball Payment excel spreadsheet. This is a tool that can really open your eyes to whether your timeline is on track and your payment style is optimal. On some you can put calculate saving by putting it in as a negative interest rate rather then a positive. Both Mary Hunt’s Debt-Proof Living and Dave Bailey have good information on Snowballing payments and how it benefits you.

I don’t think they said down size they said down grade which means purchasing a van of the needed size but a little older or a little less fancy so the cost would be cheaper. Moving in two years is important because of schools and usually in the long run a better idea then private as the cost with 4 kids will be huge. Depending on the ages of your kids better schools might not be a big concern until they are moving toward later 3rd grade where they stop concentrating on the basics and enrichment starts to be a big advantage.

That being said if your timeline slips a bit you can always add enrichment until middle school which peer pressure gets to be big and making sure your kids are in a peer group mostly bound for college is important. Also consider the move more important for schools then it is for house size. You might be able to move sooner to a similar size house on a larger lot which you can add on later when you have save the money for the addition. Sun rooms are cheaper additions then bedrooms and the girls can share a bedroom for sleeping and use the sunroom for a playroom or finishing a basement is another option.

There are a couple ways to pay off credit cards

As already was said, there are a couple ways to pay off credit cards, and either one is good. The key is to pick a method and stick with it. When you pay off the one credit card, apply that same payment to the next card, essentially creating a “snowball” effect of larger payments each month – more info on this method here.

With total debts of about $40,000 and at relatively high interest, I would consider applying all extra money–including the extra payment on the mortgage–to your credit cards first, then your car loan. Moving in two years sounds a little aggressive for being that deep in the red, so you might consider waiting longer than that. The suggestion of downgrading your van is a good one as well.

Keep tracking those expenses. Keep your savings intact if you can. Only use it for big-ticket emergencies that you can’t pay with your monthly income, like a big car or home repair. You’re doing all the right things…it will just take some time and you’ll be on much better financial footing!

Thanks for all the imput, Downsizing the van is not an opp. since we have 4 children, and the move is important to us to get the kids in a better school dist. and our house is too small for us.(the three girls share a room) My DH is looking into selling his truck and getting a car to save $ on gas…this is a big step for him. He is in the military and got a bonus, I was able to pay 1,000.00 to one card! I will keep reading and working on our debt.

Dealing with debt

Most will suggest that you pick one and pay it off as fast as you can while making minimum payments on the other credit. Which one you pick is where there is always a discussion. Some say the lowest balance to get it out of the way (snowball effect) and the other is the higher interest rate to save on interest. I will not stand and say either is right or wrong. I actually chose to pay off my wife’s car with an extra three thousand that came in that was owed to me. I chose the car, because that freed up $400 a month in cash flow that I can use on other credit.

Whichever you decide, stick with it and good luck!

You will find this is a great blog with numerous amounts of different experiences and advice of being in debt, getting free of debt and finding ways to make ends meet without going into debt again. Being debt free (especially without credit card bills) is the absolute best feeling in the world. I can relate – I was almost $14,000.00 in credit card debt. I wasn’t a homeowner then, my car was almost paid off (then it got stolen) but that’s another story. I had a savings account accumulated too (not as hefty as $3000). I did use some of the money for car repairs after my car was recovered (very rare occurrence) but other than that I left that savings account alone. I chose not to add the savings while paying off my credit card debts- they had more in interest rates than my savings account. Because of my debt to income ratio, I was basically broke at the age of thirty. I was determined to change, because I was miserable with all those bills. I downgraded my spending to the bare minimum to live for about 3-4 years in order to ramp pay my credit card bills. I had like eight to start of with.

Later I consolidated them slowly or had a few of the smaller balance ones paid off and canceled quickly. I was so determined to get rid of those credit card debts, I made a decision to live without cable TV, no cell phone and use only all generic very cheap products to survive for awhile. I lost weight because I put myself on very strict and limited daily food intake everyday, to save money. I stopped buying new clothes PERIOD. I learned to live with what I had, which is still a hell of lot more clothes than I ever feel like I really wear. If you have kids – there are other ways to spend a very little bit of money on clothes for them. If you have extra money left over each month, use it toward paying off those credit cards first. Get rid of that as fast as possible.

Continue to pay the regular payment on the vehicle. Once your credit card debt is almost or nearly gone you can pay more to get rid of the vehicle payment sooner. Or downgrade to a lower cost, more fuel efficient vehicle. Although I had a van for awhile and it was nice for the room! We went camping in it and had the ability to haul stuff while we refinished our basement.

Well, I could go on forever about getting out of debt. You’ll probably hear more from me later. Their are others that you will gather great info from too.