Getting Out Of Debt the Right Way

Posted On: March 30, 2006

Author: DarlingDee
Posted: Sun Oct 31, 2004 2:18 am
Post subject: Please help with my Credit Card Debt unpaid

I live in Texas, and I had a Citibank CC, always paid it on time and had it since the early 90’s, got in a bind and did not pay something else so my 10% interest on 7000 went to 28.8%, omg, like I could pay that. I told them that and they did not care. So mistakenly I took the American express I got stuck with and that one and went to Consumer Credit Counseling (BAD IDEA)! They hurt me….and I lost $350. Well with saying that the collection agency for American Express threatened wage garnishment, I owed them 7000, it is now done to about 4500, this all started this year.
Well with Citi I have not paid, got a few letters in the mail saying I now owe like 9000, they continue to add interest at that high rate, I am afraid to call and talk to them because they are going to try and scare me into paying it, but I don’t have alot of money to pay on this.
Can a credit card company continue charging interest if they have sent you’re account to a collection agency? Can a collection agency charge you interest? or what?
Can a credit card company or a collection agency garnish you’re wages in Texas? If so, how much? What is the chance of them doing this now days?
I am at a loss here, I have read so much on this and the laws confuse me.
Can a creditor call you’re home and not identify themselves unless the person they are asking for comes to the phone?
Can they call you’re work and so on?
Can they call you’re home 5 times a day?
If the Credit cards are only in my name, can they insist on my husbands name and work number? Can they or should they talk to him? If it is solely in my name what does he have to do with it? Because the collection agency for american express scared me into giving his info, and said it was a community property state and he would be held liable?
I am so mad, I am paying them off, with happiness, but anger on how they scared me.
I fully intend to pay all my debts, just a year ago I had great credit, now it is in the whole.
If you make a settlement, does this ruin you’re credit? Is it as bad as letting the collection sit there til it falls off? Can they keep it on you’re credit report longer than 7 years no matter if you pay or settle? or not pay?
Please help me! Sorry for all the questions but I am scared and don’t know the laws.
Thank you so much, Darling Dee!!!

I’ll try to answer to the best of my ability.

Can a credit card company continue charging interest if they have sent you’re account to a collection agency?

once it charges off it no longer accrues interest but during the 180 period from the date you went past due you can still acquire interest, late and overlimit fees and other applicable fees.

Can a creditor call you’re home and not identify themselves unless the person they are asking for comes to the phone?

most collection agencies do that as more of a courtesy and to prevent potential lawsuits. By implying to a 3rd party that the call is efforts to collect upon a debt, they are going beyond the boundaries of the law, unless the 3rd party is a spouse or authorized user or payer.

Can they call you’re work and so on?

yes and other places that you might be found such as relatives homes, cell phones, and such.

Can they call you’re home 5 times a day?

only if they never reach you. if you never answer the phone or you are not available when they do call, then they can continue to call until you are reached.

If the Credit cards are only in my name, can they insist on my husbands name and work number? Can they or should they talk to him? If it is solely in my name what does he have to do with it? Because the collection agency for american express scared me into giving his info, and said it was a community property state and he would be held liable?

I’m not sure but I believe Texas is a community property state, I’ll have to look into it though. In any case in such states it is true that the spouse can be held liable.

If you make a settlement, does this ruin you’re credit?

descant really ruin it but it doesn’t look great either. Settlements have their pro’s and con’s. things such as having to pay taxes on any settlement that subtracts more than $600 is definitely a con. for example
balance = $5000
settlement amount paid = $4000
amount shown on your 1099C form at tax time = $1000 ( this is considered an earned income)
going on the scale of 28% tax you would pay = $280
I would look at all the numbers first though. not paying the debt is already killing your credit anyways. Settlements are in in the eye of the beholder one could look at their risk model when reviewing your credit for an extension of credit and see that the company that took the settlement (most likely still got their money back) and decided to take the money and run, others may see that you didn’t pay the full balance and look down upon you for that

Is it as bad as letting the collection sit there til it falls off?
settlements are better than letting it charge off.

Can they keep it on you’re credit report longer than 7 years no matter if you pay or settle? or not pay?

It can stand for up to 10 years.

Thank you so much for helping me. Any more information you can share would be wonderful. I so appreciate you’re time and sweetness of helping me. I am still lost however and scared to death. I hate being in this mess, which is no fault of my own but I need advise before I talk to them. Thanks again and hope you have a great night!!!!
Can they garnish wages in Texas? That is a big ? for me? Can a collection agency charge you interest once they have purchased you’re account? Thanks so much!!!!

Darling Dee