What happens if.....

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farmer
 
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What happens if.....

Postby farmer » Tue Dec 16, 2008 11:01 pm

Here is a question many people wonder about What happens if I simply stop paying the credit card companies?
I own a house.
Will I be sued and a lien put on the house - that will only be paid if I sell the house?


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fffresh
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Postby fffresh » Wed Dec 17, 2008 9:35 am

farmer wrote:Here is a question many people wonder about What happens if I simply stop paying the credit card companies?
I own a house.
Will I be sued and a lien put on the house - that will only be paid if I sell the house?


It depends on the amount of debt owed. If it's only a few hundred, then they will likely write it off and hand it over to a a debt collector. If it's a large amount they could pursue you by suing, or have a debt collector sue you. The judge would then determine a settlement amount and they would then take the next step to collect that settlement from you. Depending on the state you live, this could include wage garnishment and other methods.

Either way, it's an ugly situation. I would recommend bankruptcy instead of just not paying your bill. The fees and high APR after you default will double or even triple your debt rather fast. At least with bankruptcy, you may be able to stop that as long as you make the minimum payments up until the bankruptcy hearing.

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Mogul of Pineapples
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Postby Mogul of Pineapples » Wed Dec 17, 2008 8:49 pm

It's unsecured debt. They can place a judgment against. Other than that I don't think there's much they can do.
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magyar1045
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Postby magyar1045 » Thu Dec 18, 2008 3:14 pm

And the judgment might contain provisions for wage garnishment and a bank account freeze.

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6 months same as cash is late

Postby SunsetPink » Thu Dec 25, 2008 12:57 pm

Hello, ME=new to the forum. Need advice. Have no late payments in past on my credit. Recently, had a serious water leak in my home that destroyed 40 feet of wall, including my kitchen, living room & hallway. Called insurance company & they said not covered. I live in a mobile home in a senior park in Florida where we own the improvements, but lease the land (this is common here). Tried to get a home equity loan, but found they only take double wides as collateral, so lenders would not loan on my 14 x 63 mobile home. I had to get this fixed, so I applied for & got a line of credit on a VISA for $10,000 & a $7000 loan w/ American General. Although this may have hurt my FICO score (690 - 750), it allowed me to get this fixed as it would cost me much more to buy another home. Found honest, talented contractor & most repairs are 95% done. Alot of damage, as the leak area could not be seen. Still had to live here, everything packed in boxes for 14 months, (nightmare) while I waited for completion. Some materials were delayed & then contractor had a family emergency & went out of town 2 months, so I was waiting, waiting. Now he's back, so almost done. I am now within 2 weeks of the finish line, but emotionally & physically exhausted. I really need to get my normalcy back. Towards the end, 7 months ago, I contracted for flooring (carpet/vinyl) w/ a local carpet company, financed through Wells Cargo Financial National Bank. It was a "6 months, same as cash" purchase, but I also have made payments each month, none late.

On my job, which is fairly good for Florida (as it is very difficult to make money here unless you are in the health care industry) I get bonuses based on production every month. I use those to pay larger bills, etc. Things going along fine 'til this strange "national financial emergency" occured. My boss is a multi-millionaire, bellyaching about having to change his boating habits, cut back on his cruises, etc. All of us who work there are not rich, just working people - independent contractors, no benefits, etc. I am one of those contractors & normally paying bills is no problem. My bosses response to the "bailout emergencies", etc. was to send along w/ our new 2009 contracts news that bonuses will now be paid quarterly instead of monthly, starting with the December 31st, 2008 bonus. The bonus I was expecting w/ my Dec. 2008 check was going to pay the balance on Wells Cargo "6 months, same as cash" flooring loan.

Good news = my boss paid us before the holiday instead of after, but no bonus. Bad news: Now my balance on my carpet/vinyl loan (6 mo./same as cash) is late. I am not sure what to do. I called Wells Cargo Christmas Eve, right after getting this news, but this menu choice thing kept answering, so I assume they were either too busy to answer or closed for the holiday. What should I do? I have never missed any payments, always on time, but now that the bonuses will be quarterly, not monthly, I am sunk. It will take me at least til Feb 1., or maybe even March 1, 2009 to get this paid.

My friend told me this will make my whole life meltdown. She says my good credit does not matter at all & I should just give up & declare bankruptcy, but that seems wrong. Another co-worker tells me they will be using a "pay off debt early" service called Credit Answers & it's no big deal to settle w/ creditors & in 3 yrs. everything they owe will be history & they will have good credit again. I have read things on this site indicating this is untrue & I can't see myself doing either of these things.

Now here's the kicker: I had reason to call the insurance company who insures my mobile home just before my boss's conference call where this economic bomb was dropped. I just found out the 2 people I spoke with 14 months ago when the water leak first occurred gave me the wrong answers & I do indeed have insurance coverage called "replacement " w/ a $250 deductible. I have been advised to find the receipts & submit the claims for everything I have spent. I am spending my entire Christmas time off putting all those receipts together & probably will have about $10,000 coming back to me, but they said it could take a month or maybe a little longer. They said just make it very detailed & put it together very carefully so it's easy to understand. This I am doing, but I am just stymied on what to do about the Wells Fargo account. Can anyone give me some ideas or advice?

My "6 months, same as cash" account from Well Fargo National Financial Bank was to be paid off yesterday, Christmas Eve. It was about $5000 but I have it down to $2193.

I am just not sure what to do and am so worried. I have paid my bills my whole life (I am 62) & have always had savings, but after a bad accident w/ residual injuries, my savings is now depleted, too, but I was not concered because of my bonuses would have taken care of this. Every one of us will get hurt pretty bad, as he didn't give us any notice, just dropped this bomb Christmas Eve morning on a conference call.

I tried reading the language on the back of the monthly bill but can't make heads or tales of it. Does anyone have any suggestions? :money:

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Postby AnthonyBarone » Thu Dec 25, 2008 9:12 pm

Them insurance companies will always tell you it's not covered when it is. Any time I've had any kind of claim I've always had to argue like heck to get them to pay up. Let me get this right here though. You owe about $2300 and will have the money soon to pay it off? Any way you can borrow some money from another card to hold you over a few weeks or couple months here. As far as the payment being late I don't know. Christmas day now so you probably won't find anything out till tomorrow. When you do though let me know. Was that full amount due after 6 months or any options to extend it out longer and turn it into an installment loan? That would be the best option and it don't matter the interest really if you only got to pay on it a month or two until you can pay it off in full.

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fffresh
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Postby fffresh » Fri Dec 26, 2008 7:02 pm

I apologize to hear about your situation. 6 months same as cash does not mean the amount is due in full after 6 months, it simple means that for the first 6 months you won't pay interest - the same as if you paid with cash - and after that time you will pay interest, both into the future and retroactively applied to the past 6 months. Unfortunately this interest will cost you, but I estimate the monthly payment on this amount would not be too much.

Are you able to pay the minimum monthly payment now while waiting for the other funds to come through? That should be in the neighborhood of $100 a month.

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Postby 1bootcamp » Sat Dec 27, 2008 12:19 pm

What your friends are telling you about you should declare bankruptcy is total bull and so is whatever that Credit Answers is they're trying to push on you because there's no magic way out of debt. Debt settlement companies end up costing you loads in intentional late fees and interest they create and don't fix anything.

What the guy above me is saying should work. If it's 6 mos/same as cash you should be able to keep making monthly payments. The best part is you know you have that money coming from the insurance so it's a temporary problem. Most in debt have no hope of new money coming in but it sounds like you have a guaranteed payout on its way. With that all you have to do is scrape up enough to make the minimum payments until then and you should be okay.



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