10 Steps to Not Paying Your Unaffordable Credit Card Debt Steps to Not Paying Your Unafford… ·...
Transcript of 10 Steps to Not Paying Your Unaffordable Credit Card Debt Steps to Not Paying Your Unafford… ·...
10 Steps to Not Paying Your Unaffordable Credit Card Debt
1 Copyright 2009 - 2014 Vision Publishing Inc.
10 Steps to Not Paying Your Unaffordable Credit Card Debt
2 Copyright 2009 - 2014 Vision Publishing Inc.
Table of Contents Introduction .................................................................................................................................................. 3
Step 1: To get out from under burdensome unpaid credit card debt, you first need the right mindset
that will enable you to succeed. ........................................................................................................... 3
Step 2: Understand you can walk away, if you have to, from your unsecured credit card debt by
following in the footsteps of many others including myself who were in the same situation you find
yourself in today, or one you may soon find yourself in. ..................................................................... 4
Step 3: You Need to Learn to How to Fend off Unsecured Creditors (credit card banks) and Their
Debt Collectors before Making Any Decisions !!! ................................................................................. 5
Step 4: Do Not Commit Financial “Death” By Guilt .............................................................................. 6
Step 5: Understand the Credit Card Debt Aging and Debt Collection Process ..................................... 6
Step 6: Use the FDCPA and Watch for CFPB, but MORE Federal Protection for Consumers with
Overdue Credit Card Debt Is Still in the Process ................................................................................. 13
Step 7: Learn to Practice Resistance and Documentation – How to Help Yourself ............................ 14
Step 8: Understand The Arbitration Scam .......................................................................................... 15
Step 9: Avoid the Wrong Kind of Help ................................................................................................ 16
Step 10: Accept the Reality That You Cannot Afford to Pay These Debts and Make the Decision to
Stop Payment ...................................................................................................................................... 17
10 Steps to Not Paying Your Unaffordable Credit Card Debt
3 Copyright 2009 - 2018 Vision Publishing Inc.
Introduction
At this point in your life your credit card debt burden is probably making it difficult
for you to think straight. You are at risk of, or you may have already fallen victim
to, some sort of credit card debt relief program that got you to pay money you didn’t
really have before they delivered any results. And, you ended up not getting ANY
debt reduction or elimination at all.
Step 1: To get out from under burdensome unpaid credit
card debt, you first need the right mindset that will
enable you to succeed.
It is time to stop flailing about as if you were drowning in that debt. I got my mind
“right” by educating myself about credit card debt and debt collection. (If you have
not read my story about how I successfully stopped paying $63,000 in credit card
debt, read it here.) If you too educate yourself first, then you will develop a
productive mindset that will enable you to make the right decisions and take the
right actions to put your credit card debt behind you.
You must have sufficient background and knowledge to stick with the strategies I
recommend. That means you must read and study these materials. If you are not
willing to take the time to read and learn about your situation, then DO NOT buy
my ebooks because you will have to no clue about what will and what will not work
with debt collectors and collection attorneys.
Today finances are difficult for many people. Are you having trouble paying your
bills? Is your credit card debt piling up with increased interests rates and late fees?
Have your balance limits been reduced? Have you thought about bankruptcy? Do
you feel guilty about the prospect of being in debt and not being able to pay your
bills?
Your financial problems may be the result of a job loss, a catastrophic illness, a
death in the family, student loans, a failed business venture, or just simple
10 Steps to Not Paying Your Unaffordable Credit Card Debt
4 Copyright 2009 - 2018 Vision Publishing Inc.
mismanagement of your finances. Whatever the cause, are you concerned about
being controlled by your creditors?
You should never sacrifice resources that go to your or your family’s food, shelter,
clothing, transportation, healthcare and education needs to pay unsecured credit
card debt.
NOW is the time to replace your fear of the unknown consequences of being in debt
with the confidence and a plan that will get you beyond your debt problems. Now is
the time to educate yourself so you can confidently develop a plan.
After you go through this process of knowledge acquisition you will realize that
bankruptcy should be the last thing for you to consider NOT THE FIRST!
Have you been enticed by the seductive radio ads from debt settlement and
negotiation firms promising to settle your debts for you for less than 50 percent of
what you owe? Please read my books first, and seek further education online if
needed, BEFORE you pay thousands of dollars up front to let someone else handle
your debt problems for you. Eventually you will realize, like many of us have, that
you are the best person to deal with your credit card debts.
Step 2: Understand you can walk away, if you have to,
from your unsecured credit card debt by following in
the footsteps of many others including myself who were
in the same situation you find yourself in today, or one
you may soon find yourself in.
If you need help, I can help you find the right kind of help (not the kind with the
best sales pitch).
In this first ebook I’ll lighten your load by sharing in broad strokes what little
power credit card companies and debt collectors really have over you if you take the
right actions against them at the right times. Then in subsequent installations, I’ll
provide the detail you’ll need to help yourself, including the specific resources to
continue your debt relief education and, if needed, to find the right kind of help.
10 Steps to Not Paying Your Unaffordable Credit Card Debt
5 Copyright 2009 - 2018 Vision Publishing Inc.
Until you have educated yourself, you should consider bankruptcy your last option,
not your first. If all else fails, you can always file for bankruptcy protection. But,
why do that much damage to your credit unless you have to? After reading this
book, you will realize you can solve your problems without filing for bankruptcy.
Step 3: You Need to Learn to How to Fend off Unsecured
Creditors (credit card banks) and Their Debt Collectors
before Making Any Decisions !!!
It is important to understand the realities of the debt collection industry. These
realities are why you can start feeling comfortable again right now.
If your account is in arrears, it is one of millions of accounts in arrears. If your
account is assigned to a collection agency, it is one of thousands in that batch
assignment. If your account is sold to a junk debt buyer, it is one of thousands, tens
of thousands or hundreds of thousands sold in that package of junk debt for five to
ten cents on the dollar or less. No, there is not a special place in hell for you alone because you owe money you cannot afford to pay. There is probably not even a file on you. You are just a line in a database along with everyone else.
You safety and security lie in these numbers, in the thousands of accounts and in
the pennies per dollar each is actually worth. If you resist collection attempts (after
you learn here how to properly do so), it is simply not profitable for collectors to put
more time into chasing you for your debt, when they can put that time in getting
the easy returns from other people who put up no legal resistance. Consequently
your account gets put aside in favor of other more profitable accounts, because debt
collectors do not expect to collect on 100 percent of the accounts handed over to
them. They do not even expect to collect on 50 percent of those accounts. This book
will show you how to not show any of the weakness and opportunity debt collectors
look for in each account holder. With the right actions yours can become a
There is Safety in the Number of Consumers in Debt
10 Steps to Not Paying Your Unaffordable Credit Card Debt
6 Copyright 2009 - 2018 Vision Publishing Inc.
non-collectible account. When your account gets passed from one debt collector to
the next, that is not a sign that you are losing the battle. Instead, it means you
are winning because the last guys do not want to deal with you anymore. Most of
my accounts went to two or three debt collectors each.
Step 4: Do Not Commit Financial “Death” By Guilt
Most people are honest and feel naturally guilty about their indebtedness. They
want to do the right thing. Because you owe these unsecured debts, you can feel
guilty, fearful and helpless. Collectors know this and use it against you. They use it
to get you to admit to a debt and to re-contract with them. They also know that
guilt will prevent you from helping yourself as much as you can. Because of this
guilt and hopelessness, many people put their head in the sand and ignore written
debt collector communications. They do not open that mail. Then, suddenly out of
nowhere they find themselves with a civil judgment against them or an arbitration
award about to be confirmed, or worse their wages garnished or bank account
seized.
To be successful with credit card debt relief, you’ll need to control your emotions and
deal with these collection efforts properly, as I will show you. Remember, denying
and disputing credit card debt is a legal strategy, not a personal statement of
character.
Step 5: Understand the Credit Card Debt Aging and
Debt Collection Process
5a. Going Into Arrears f you cannot pay anything on your account, the credit card banks collection efforts
will begin, and as each missed monthly payment deadline passes, they will
intensify. You will receive letters and phone calls, weekly, perhaps even more
frequently. Fortunately, these will be auto-dialers handing off your call to the next
available customer service rep. working in the in-house collections department.
They will have no knowledge of your account except what is on their computer
screen when they talk to you. They are not paid by commission. They are just
10 Steps to Not Paying Your Unaffordable Credit Card Debt
7 Copyright 2009 - 2018 Vision Publishing Inc.
processing your account as it heads to default. If you cannot pay anything, do not
listen to them and hang up. They’ll threaten handing your account over to a
collection agency, or possible legal action or arbitration. The Fair Debt Collection
Practices Act (FDCPA) does not protect you from original creditors calling to collect,
but their collection efforts are usually not that bothersome, particularly if after a
while, you do not take their phone calls.
Finally your account will default. That means the bank will write it off as a loss.
That usually happens after six months of non-payment. The Office of the Comptroller of the Currency keeps a tight leash on banks’ bad debts and does not
allow too much time for non-performing debts to be carried on their books. Making
sporadic payments could prolong this process. That may be beneficial for you, but
probably not.
5b. Can You Afford to Negotiate a Lump Sum Settlement?
So, let’s assume that now or at some point in the near future, you cannot keep up
with your minimum credit card payments and they go into arrears. And, perhaps your credit rating has already begun to slip.
National credit card banks do not want to default your account soon after you fall behind, they will probably offer to work with you . . . but, on their terms. However,
their “help” may not be to your liking. Fees, penalties and a higher interest rate
could inflate your balance while you are making small, affordable monthly
payments to tide you over until you can pay more. You credit may also suffer as
they “help” you. You should realize, however, that for banks everything is
negotiable under the right circumstances. Those circumstances will be your non-
payment of monthly credit card debt. As you near the six month default debt date
when the bank must write off your debt, you may be able to negotiate a reduced
lump sum settlement. Of course that assumes you have a lump sum to bring to the
negotiating table. Do not negotiate a reduced payment plan. That will just prolong
the inevitable. You will miss a payment because you are having trouble paying for
everything that month, and all the money you have paid under the negotiated settlement will be eaten up by fees, penalties and interest.
10 Steps to Not Paying Your Unaffordable Credit Card Debt
8 Copyright 2009 - 2018 Vision Publishing Inc.
5c. The Best Time to Negotiate
The best time to negotiate a lump-sum settlement, if you do have the money, for
less than the balance is in the weeks leading up to the six-month charge off or
default of your credit card debt. This is the last step to how banks attempt to
collect their overdue credit card debts. Once your account is written off it will be
placed with the bank’s collection agency (CA), then eventually sold to a junk debt
buyer (JDB) for around tens cents on the dollar.
People have negotiated payment in full at as low as 20 percent of the debt with a
credit card bank, also known as the original creditor (OC), or with the bank’s
collection agency. I was offered 25 percent right before charge off on a $4000 credit
card debt, and I could have probably negotiated that down, but I had no cash to
make the $1250 one-time payment. Usually you pay a lump sum or negotiate a
payment schedule. But, if you cannot adhere to the schedule, the negotiated
balance becomes void and interest and penalties are tacked on. Also, the bank is
required to issue a 1099 income statement to you on the amount of the original
balance that you negotiated away. So you will have to pay taxes on that portion.
But, if you income is low in the year the 1099 is issued, you’ll have some leeway
with the IRS. You can also make credit repair part of your negotiations. Everyone gets better treatment on their credit report if they negotiate for it. The issue is how much better.
5d. Collections and Negotiations before Your Account Defaults
After its default by the bank, before the account is sold to a junk debt buyer, and
sometimes leading up to the bank’s default of it, the debt is given to a collection
agency (CA) to pursue. Here the Fair Debt Collection Practices Act (FDCPA) does
protect you. The CA must send you a mini-Miranda statement telling you you have
thirty days to dispute the debt and to request validation of the debt. When you do
that you can instruct the collection agency per the FDCPA to stop collection efforts
including calling you. They must also NOT put a negative listing (trade line) on
your credit report. That too constitutes a collection effort. If they do, they are in
violation of the FDCPA and liable for $1000 per violation in civil court. Violations
10 Steps to Not Paying Your Unaffordable Credit Card Debt
9 Copyright 2009 - 2018 Vision Publishing Inc.
like that could present opportunities for you to retain a consumer rights attorney on
a contingency fee to sue, at no expense to you, the debt collector for their FDCPA
violation(s).
During this time, when the collection agency represents the bank, it will receive
only a percentage of what it collects from the original creditor, you can continue to
pursue negotiations directly with the bank because they still own the account, or
with the bank through the collection agency.
Debt collection agencies are powerless to do you any harm. All they can do is lie
about pending lawsuits over the telephone. If your credit card debt ever does end
up with a collection attorney, that collection agency will not receive any money for
its collection efforts against you. It is the collection attorney who will be paid.
5e. Debt Collection after a Credit Card Account Default and Sale
Once your account is sold to a junk debt buyer, the junk debt buyer will notify you of
their ownership and demand payment. They are usually not licensed to collect
consumer debts in your state because they are junk debt buyers not debt collectors.
So, in addition to disputing the debt, requesting validation and instructing them to
cease collection activities, you can warn them about their violation of the law with
their lack of a collector’s license. (You will need to check you state’s database of
debt collector licenses, usually found on a state’s web site.)
The debt validation letter (DV) is your number one defense against junk debt
buyers, collection agencies, and collection attorneys. It is a defense that,
fortunately for the debt collection industry, not many people use. The FDCPA
requires anyone attempting to collect a debt from you to notify you in writing with a
“mini-Miranda” statement that you have the right to dispute the debt and request
validation of it. You then respond to this with a debt validation letter (DV) ( disputing and requesting validation AND instructing the collector to cease
collection activities. Junk debt buyers and their collection agencies usually
disappear after a good debt validation letter. (There are sample debt validation
letters in the Debt Collection chapter as well as links to many more.)
After the DV letter, the only thing debt collectors can legally do is pursue you in
court, but shouldn’t they save that for someone who is easier to intimidate? If they
make further collection attempts, and you can document them, they can be
10 Steps to Not Paying Your Unaffordable Credit Card Debt
10 Copyright 2009 - 2018 Vision Publishing Inc.
sued for $1000 per violation under the Fair Debt Collection Practices Act. You can
find consumer rights attorneys who will do that for you on a contingency basis.
At this point the junk debt buyer could:
1) Give the account to another collection agency. That collection agency may call
out of the blue before they send you a mini-Miranda telling you that you will be
receiving a court summons from their attorney suing you over this debt. And,
that NOW is your last chance to pay without court action. This is a classic,
lying, scare tactic. Do not believe it and DO NOT give you bank account
information to make a payment.
2) Give the account to a collection attorney. If this happens, the attorney, hoping to
scare you with their letterhead, will send you another mini-Miranda, which you
can reply to as you have the others. Attorneys acting as debt collectors are
considered debt collectors by the FDCPA and are liable for violations in the same
way.
3) Sell the debt to another junk debt buyer.
During this process it is imperative that you –
i) Always dispute and never admit that the debt is yours.
ii) Do not “re-contract” with anyone attempting to collect a debt from you.
Remember that the collection agency, junk debt buyer, or collection
attorney is trying to re-contract with you by getting you to admit to the
debt; by getting you to do their job for them. Their job is to prove you owe
the debt.
iii) Stay off the phone. Do not try to handle things solely by phone. There is
no record of a phone call and no reason why the collecting party should
hold up their end of the deal. Do not talk to debt collectors on the phone
unless you are attempting to negotiate a settlement that will be followed
up in writing.
4) Never settle with collection agencies and junk debt buyers. It will hurt your
credit even more. “Doing the right thing” is NOT paying a dime. The way the
debt collection industry is set up, you will do a disproportionate amount of
damage to yourself trying to repay an old debt.
10 Steps to Not Paying Your Unaffordable Credit Card Debt
11 Copyright 2009 - 2018 Vision Publishing Inc.
5) Always respond to written debt collection communications. People who DV are
much less likely to be sued. People who do not DV are showing weakness and
opportunity. The profitable collection numbers principle applies to them.
6) Always, always document your communications. Keep copies of all letters to
collection agencies, junk debt buyers and attorneys. Send everything certified
mail return receipt requested (CMRRR) U.S. mail.
7) Never, ever give your bank account information over the phone. Remember, 100
percent of debt collectors will lie to you 100 percent of the time. There is no real
urgency that requires you to share that information, just the lies about court
action that the collectors spin to get you to submit to them.
8) In the unlikely event of a court action, always answer a court summons within
the time required and stating the appropriate legal defenses as determined by
your local rules of civil procedure. A few pages are sufficient to avoid an
immediate default judgment against you and to give enough time to prepare
your case against the typical opportunistic collection attorney. Many debt
collection attorneys send out summonses by the dozens fishing for defaulters. If
you do not reply, they can get a default judgment against you; if you do reply,
they disappear, moving on to the next potential defaulter.
9) Understand that while the debt is yours, it is your legal right to deny it, to
dispute it and to insist that the collection attorney document their case against
you, proving:
a) There was a contract between you and the original creditor;
b) They can document their ownership of the debt if they are not the original
creditor;
c) How they arrived at the specific amount of the debt they say you owe.
All of this can be too much work for an opportunistic collection attorney, who
would prefer to find less resistance with another debtor.
10 Steps to Not Paying Your Unaffordable Credit Card Debt
12 Copyright 2009 - 2018 Vision Publishing Inc.
10) Again, do NOT take telephone calls from collectors. If they have sent you a
mini-Miranda and you have responded properly to it, you have instructed them
not to call and by doing so they are in violation of the FDCPA. If they call out of
the blue, they are just a voice on the other end of the line, and you do not discuss
your personal finances with strangers. They want you to admit to the debt and
to re-contract with them.
11) If the collection agency, junk debt buyer or collection attorney respond to your
debt validation letter with documentation (usually a few copies of past account
statements and sometimes an unsigned contract) reply CMRRR disputing the
debt, stating the documentation is insufficient and asking for more.
20-30 years ago if you were behind in payments, your bank would have called to
remind you that you credit rating would suffer if you failed to pay the unsecured
credit card debt, and that would have been the end of it. Unsecured bad debt meant
a bad credit rating for a while. Over the years, however, a whole debt collection
industry has blossomed as Americans have used more and more credit cards.
Paying collection agencies, attorneys, and junk debt buyers who prey on people
during hard times is not morally or ethically appropriate, or legally required. It
simply creates more problems for those paying and for other debtors down the road.
5f. About Collection Attorneys
According to the New York Times over 90 percent of consumers who receive a
summons for the collection of a credit card debt do not respond. That means they
lose be default. And, the credit card bank or junk debt buyer gets a default court
judgment against the consumer.
What happens to the few that do respond? The short answer is good things most of
the time. Collection attorneys are set up to send out summons and process default
judgments. Actually going to court is not their strong suit. In addition, given the
nature of credit card debt, collection attorneys have trouble documenting an
individual consumer’s debt to court standards. They have difficulty producing
signed contracts because there are none. They have difficulty documenting the total
alleged amount owed including all of the charges, payments, interest, fees and
penalties. They cannot produce a truthful affidavit from someone with personal
10 Steps to Not Paying Your Unaffordable Credit Card Debt
13 Copyright 2009 - 2018 Vision Publishing Inc.
knowledge a specific debt. There are just too many credit card accounts perbank
employee for personal knowledge of individual accounts to exist on anyone’s part.
It is best to use a consumer rights attorney to respond.
Step 6: Read the FDCPA and Monitor for Consumer Finance Protection Bureau for More Guidelines on Fend off Debt Collections and Collection Attorneys.
Begun during the Obama administration the Consumer Finance Protection Bureau and its website https://www.consumerfinance.gov offer useful advice and instruction. as well as letters, how to guides and rights reminders to consumers who cannot afford to pay. There is also a section protecting senior citizens from debt connection scams, and sample letters to collections attorneys for those who liive only on Social Security income. While it is still working to protect consumers from debt collector abuses, now under the Trump administration, it seems to be a lot more creditor friendly. Nevertheless, there is information there that reinforces what I tell you in my content and that will increase your peace of mind going forward.
According to creditcards.com, The Credit CARD Act of 2009 does provide some
protection for consumers. It stops retroactive interest rate increases on old balances
and the practice of universal default where a credit card bank would penalize card
holders who defaulted on a debt unrelated to the bank’s card debt. It also caps late
fees and penalty fees.
The mainstay for protecting consumers against the abuses of debt collectors
pursuing overdue credit card is still the federal Fair Debt Collection Practices Act
and related state-specific regulations in some states. Consumers have to learn how
to use this law to stop debt collectors from contacting them and to protect their
credit rating from debt collectors piling on negative listings. I have given you the
highlights of that process here and explain it in depth later in my course. You may
have heard of debt validation letters, but without the background and letter content
I provide, you will miss how to use these DV letters effectively. Otherwise for you, they could simply become one more debt relief strategy that did not work.
10 Steps to Not Paying Your Unaffordable Credit Card Debt
14 Copyright 2009 - 2014 Vision Publishing Inc.
Step 7: Learn to Practice Resistance and Documentation
– How to Help Yourself
Resistance and documentation are the keys to beating these parasitic debt
collectors. It is important to understand that junk debt collection involves the
accounts of thousands of people.
Modern day information processing allows a collection agency to spit out thousands
of mini-Mirandas at a time, bulked mailed at 34 cents postage. Most of these people
in debt, when contacted, re-contract out of fear and become prey to the collection
industry. As a result:
1. They may negotiate a payment plan only to have the proceeds eaten up by
“interest and fees” charged by the junk debt buyer and collection agency.
They pay for a few years, but the original balance remains the same.
2. They may make a lump sum “payment-in-full” for less than the full balance
only to have the remaining balance sold to another junk debt buyer and
collections start over again.
3. They may give their bank account information to have an immediate
payment withdrawn, only to have future unauthorized payments withdrawn.
4. They may make a payment only to have the collection agency later claim
there is no record of it.
5. They do not realize any token payment made re-contracts for the debt and
extends the state’s statute of limitations on that debt, as well as the seven-
year credit reporting limit on that debt.
Why should these collectors spend time with someone who is resisting them with a
dispute and debt validation letter? They shouldn’t, and they do not. The debt
simply gets sold to another junk debt buyer.
Sometimes a junk debt buyer’s collection attorney or a legal firm that is also a junk
debt buyer will file suit to collect the junk debt. To have standing before the court
10 Steps to Not Paying Your Unaffordable Credit Card Debt
15 Copyright 2009 - 2018 Vision Publishing Inc.
they need to document a contract between the defendant and them. They must show
the original credit card contract and document the sale of the account to them. That
is, that one account specifically, not the thousands of accounts that were acquired
with it. And, they must document how they arrived at the balance they claim is
owed. Instead of doing this, their typical approach is to get the alleged debtor to
admit to the debt. There must be a contractual connection between you and them.
You can tell how strong their case is with what accompanies the summons. If there
are no documents of this sort, they are trying to scare you into submission or hoping
you don’t know what you are doing and cannot afford an attorney. They want to
hold a court case over your head to get you to settle for unfavorable, onerous terms.
The most likely scenario, when a debt collection attorney is involved, is they will
send you a mini-Miranda as they are required to do. But, if you respond disputing
and requesting validation, they will move onto weaker victims in the current debt
pool they are working with.
7a. Repairing Your Credit Where your credit is concerned, bankruptcy is the worst option. A bankruptcy will
stay on your credit reports for 10 years. An undisputed credit card or other debt
has to come off seven years and 180 days after the date of first delinquency (DOFD).
So, you are three years ahead already before you even attempt to repair your credit.
Original creditors sell your account to junk debt buyers and afterward become less
diligent in updating or verifying that account’s details in your credit reports.
Collection agency and junk debt buyer listings can be removed fairly easily from
your credit report, if you write to them initially and properly, that is.
Step 8: Understand The Arbitration Scam
If you credit card agreement has an arbitration clause, after charge-off your bank
will refer it to a collection law firm who will threaten arbitration if you do not work
with them to pay the debt down or off. If you do not comply, within six months of
the initial attorney’s letter, you may receive notification of an arbitration
proceeding begun against you.
Credit card debt arbitration is a rigged scam. However, while statistics show the
credit card companies win over 96 percent of the time, most people who have tried
to beat it in a regular court of law have succeeded. I did, twice.
10 Steps to Not Paying Your Unaffordable Credit Card Debt
16 Copyright 2009 - 2018 Vision Publishing Inc.
Arbitration IS beatable. The key is insisting you did not agree to it and did not sign
a pre-dispute arbitration agreement and to NOT participate in the arbitration
process. THAT would be re-contracting with the creditor and an admission of your
debt. When an arbitration award is issued against you, it must still be confirmed by
a court of law before you bank account or wages can potentially be seized or
garnished. The key is to file suit against the bank before arbitration begins or
within 30-90 days after the award (depending on state law). You charge that you
never agreed to arbitration. Then it is up to them to properly document your
agreement.
The local outsourced attorney (Every large collection agency has a national network
of local collection attorneys.) who handles arbitration matters in your court district
for the national collection law firm is used to experiencing no legal opposition from
debtors, then filing papers and getting awards with the arbitration forums and
confirmations with the local courts. They make a percentage on what they get from
you without doing any real work. If they have opposition, they will do a poor job of
defending their client; that is if they simply do not default in the face of your
lawsuit, as they did in my case. For the best result, use a consumer rights lawyer.
In the last few years most national arbitration firms have ceased handling credit
card debts because numerous states attorneys general put pressure on them to
do so.
Step 9: Avoid the Wrong Kind of Help
Any person with credit debt hanging over their head can fall victim to the siren
song of “We are professionals. Let us take care of that debt problem for you.” Any
debt relief firm that wants you to pay them and in addition give them your money
to pay your creditors monthly or with a lump sum later is the wrong kind of help.
Debt counseling and “non-profit” debt counseling, debt management, debt
settlement, debt consolidation, or debt negotiation are the terms used by profit-
motivated “professionals” offering their “expert” help for an upfront fee and a
percentage of what they can save you.
These debt relief firms are the flip side of the debt collection industry. They too
prey upon people’s inherent guilt over their debt. Only they do it by offering hope
and escape. They are seductive. They offer to solve your debt problems. You can
trust them, they say. You don’t have to worry anymore. They have contacts at the
10 Steps to Not Paying Your Unaffordable Credit Card Debt
17 Copyright 2009 - 2018 Vision Publishing Inc.
credit card banks. They have years of experience negotiating debt settlements, and
so on.
The reality is you pay them thousands of dollars up front, most of what they will get
from you. (f you only owe a few thousand, they will tell you you are not a candidate
for their services.) Then they go to work . . . ruining your credit in the name of
increasing negotiating leverage and trying to keep your money that is already
sitting in their bank account.
9a. Finding the Right Kind of Help
Most attorneys who practice law in your community do not have much experience
defending against debt collection. There is no money in it. They are interested in
greener pastures. Typically they will want as much or more to defend you as you
owe, or they will advise bankruptcy, knowing they will be paid well as the first
creditor to be paid. However, consumer rights attorneys can be found to handle
these types of cases for reasonable fees. Also, many other attorneys now
understand how to successfully defend a consumer who owes credit card debt in
court.
Step 10: Accept the Reality That You Cannot Afford to
Pay These Debts and Make the Decision to Stop Payment
I know from my own personal experience that deciding to stop paying my credit
cards was like making a giant leap into the unknown. But, the sooner you start the
statute of limitations clock (usually three to six years) and the credit reporting
period of 7 to 7.5 years, the sooner this debt will be behind you.
What made it easier for me was I had a plan in place when I stopped paying my
credit cards. I continued educating myself and refining the plan after I stopped
payment, and . . . it worked!
10 Steps to Not Paying Your Unaffordable Credit Card Debt
18 Copyright 2009 - 2018 Vision Publishing Inc.
10a. Adopt a Do-It-Yourself Attitude
With the right knowledge and information you can manage your financial situation
and escape the tentacles of the debt collection industry.
Everyone’s debt situation is different. Different credit card banks do things
differently. Junk debt buyers, collection agencies and debt collection attorneys also
vary their approach to pushing your guilt and fear buttons. With the foundation in
this content and access to specific, relative online forum postings and other
publications provided by this content, you can:
Never forget it is your job to diligently manage your present financial situation, and
that you can save thousands or tens of thousands of dollars doing that properly.
Treat this challenge as a part-time job paid for by the money you are saving
yourself. Many people of all education levels have done this before you, and as you
will see in the online forums, they have succeeded.
In addition, after gaining the knowledge in this book, you will have the
confidence to find the right kind of help, when and if necessary.
And remember, the majority of delinquent credit card account holders do not resist
debt collection at all, or they do it ineffectively. If you deny, dispute, and request
validation CMRRR, debt collectors or debt collection attorneys will decide to spend
their time with easier debtors.
Start putting this debt behind you today. Go to the next step of my program.
This content is not intended as a substitute for legal advice. If you need an attorney in your local area, please contact a licensed attorney in your state.
1) Understand you specific challenges;
2) Read about how others have handled those challenges;
3) Respond appropriately as these challenges occur.