We went through consumer credit counseling

Hi,

I’m new to the blog. I’ve been married for 17 years, and we have 4 children 3,6,13,and 16. We still struggle with debt.

We went through consumer credit counseling before we were married. We were in debt over our heads and it took the pressure off of us as CCCS handled all of the payments for us and negotiated with each of the creditors.

Our only responsibility at the time was to get them a money order or a cashiers check once a month by a specific date and they took care of the rest. It took us several years to get everything paid off but it was well worth it.

As we began to have children we slipped into old habits, especially as they neared the teen years so we have more debt than we feel comfortable with and are working to take care of it.

One thing that has really helped me is our Credit Union. Ours is one of a very few that offer a bill payment service through their savings account (or share account for those of you that know the terminology). It has been such a relief for me to give up a checking account. I never worry that one of us forgot to write a check or withdrawal into a register, or worse one of those sneaky automatic payments!

I set up my payments to pull on whatever day I need them to, and they are withdrawn that business day. It has been wonderful!

Just a note for those of you considering a credit counseling service, be cautious. Not all of them are the same. The non-profit ones usually charge a monthly fee on a sliding scale of around $30 or less. When I worked in a bank I had several people mention they were considering a counseling service, when I question the cost I was told several times that the cost was $1000-$2000 upfront for their service. I immediatly pulled out the phone book and looked for the real non-profit one to refer them to!

Credit counseling agency question

I have a question that someone can hopefully answer. I am working with a credit counseling agency, I have been with them since July 2004. I have been making the monthly payment to them but so far they are telling me “the CC companies haven’t responded to our proposals.” Should it take this long to receive a response from the CC companies? I recently checked my credit report and it shows the CCs have been receiving the payments. I’m just curious as to the length of time this should be taking. Thanks for any info.

I used to work for a credit card company and collected on the people that went through credit counseling. This is how things worked where I was at… Every day we would get proposals from the Cr Counseling that requested interest lowered or stopped, and proposed a reduced payment. I had a set guideline on interest and minimum payment amount. I checked the appropriate boxes and calculated the payments amount and accepted or declined them. Then the account had to be set up in the system and the proposal returned to the agency. Some days I would get 2 proposals, others would be 200. I was 1 of 4 people that worked the mail so you can imagine it took us a while to get it done. It just dpeends on their process.

Someone was asking about a settlement payment and only paying 65% or 45%. I am confused what does that mean. If you don’t pay on your debt or credit card and then ask to settle, you can settle for less? I need some advice as to what routes I can take to get myself solvent again. My job pay is taken up every month to pay all the bills leavinglittle for any of the irregular payments that happen like insurance payments or payments to have the propane filled, etc. I owe my own home, a single mother of 2, I am paying on a truck (that I use mostly for my hobby farm), a car and a large credit card bill.

I can no longer continue at this rate and need to make some changes. I have to high of a debt to asset ratio. I do have a retirement account for being a teacher but to take that out, I would lose half of what it is worth. Are there any feasible solutions out there without filing for bankruptcy or the like?

I originally was going to file bankruptcy and decided to try and pay off our debts the Dave Ramsey way. When I spoke with one of my creditor’s, I was told that if I was 90 days or less past due then I could possibly settle for 65% of the total debt. If I was more like 120 days past due, I could possibly settle for 45% of the debt.

I was not planning on not paying but it was suggested that since I might be in a position to settle in a few months that I could hold off paying. I will use what I would have put towards that debt to pay on my next smallest debt.

The most feasible solution is to sell those things which you can’t afford (truck for hobby farm and car with payment) and pay cash for cheaper versions of each. Then you can take the money you were sending to the bank every month for those vehicles and get rid of the consumer debt. It took more than a month to get yourself into this mess and it’ll take sacrifice and time to get out of it.

The real question is (if I may be so blunt) “How hard are you willing to work and how attached are you to the “stuff” that’s keeping you down?” If you gte focused for a short time and get rid of the luxuries you’ll be able to get through this and come out the other side better for it. Why “give-up” and file for bankruptcy when you can wade through this and win…there IS hope!

I hate to sound like a broken record or a Dave Ramsey commercial….but you REALLY need to check out www.daveramsey.com and listen to his radio show or archives on the web. If you need some info and direction he’s the man!