advise please

[Kam]

Dear Mom:

I have done my share of worrying about my 18 yo daughter. Before she turned 18 she learned the hard way about NSF checks. She had to deal with the CA and pay off the checks, plus the bank fees. Now, it did not help that her checking account was tied to ours and she could simply transfer money from our account to cover her account. For a while there, she would take money out of our account and cause us to go into overdraft. We finally got the problem solved by me threatening to change the password to our online account so she could not have access to her account through ours. She goes to school full time, carries a 15-20 hr work load and is taking 6 credits of college classes in an effort to get a head start into a local nursing program. I keep a careful watch on her checking account and will slip in a few dollars here and there if I think she needs gas money. She has applied for her first starter credit card and has learned the pitfalls of overextending and poor financial management by being an unwilling participant in this bk.

I echo what every one else has said, your daughter needs to spend time reading about bankruptcy. It's nice that you are spending alot of time and emotional commitment to doing the research, but ultimately she has to do this for herself as well. Otherwise, she's simply being buzzed through the process without fully understanding the ramifications.

I hope you understand I am not downing you. I am a mother and I want what's only best for my oldest daughter as she prepares to embark on her own. We are here to help.

Kam

[jragan]

Who said this?

"Today, most of the good people are afraid to be good. They strive to be broadminded and tolerant. It is fashionable to be tolerant - but mostly tolerant of evil - and this new code has reached the proportions of demanding intolerance of good."
This quote is incredible. Does it belong to one of you all?

[jragan]

To Kam

Do you think it is possible that BK is a piece of cake compared to raising kids? (just kidding) My husband and I love our kids so much. It can be the greatest love and the greatest hurt. We recently took up a hobby that we can do together that relieves the stress. Golf. We love it most of the time. I read the other day that a famous person referred to golf as the ultimate grace and the most complete humiliation. This is true. The good shots are like a work of art that keep you coming back and the bad shots (many) make you wonder what you were thinking to try such a ridiculous game.
Thank you for the encouragement.

What do the rest of you do for stress relieft?
worried mom

[SinkingFast]

One advantage to proceeding now vs later

The CC companies won't have passed the debts on to 3rd party collections companies. You have all the correct addresses and contact info right now for all the people your daughter owes money to. The longer time passes, the more likely your attorney will have to spend his/her time and your $$$ to get some of that info for filing.

[jragan]

debt passed on

Why did you say that CC debt would not be passed on? We have already received a letter from a collection agency for the CC that she owes the most on. It was only about 7 months behind. Is this just another tactic the CC companies use and not really a collection agency?
confused

[StaciMM]

JRagan-if she was behind for 7 months it might be an internal collections area (within the actual company) or they may have outsourced it to a collection agency.

Since you mentioned before that her payments went up 4 months into a 6 month goal, my guess is that at that point at least it was still with the original creditor. The recent increase in minimums was not within control of the creditor-all are required to make minimum payments include more of the principal.

[down @ out]

Margerita with a splash of orange juice, with salt around the rim, and watching Casablanca.

[SinkingFast]

Why did you say that CC debt would not be passed on? We have already received a letter from a collection agency for the CC that she owes the most on. It was only about 7 months behind. Is this just another tactic the CC companies use and not really a collection agency?
confused

Down the road, the CC company(s) will sell the debts to 3rd party company(s) for pennies on the dollar. Then the new debt collector will come after your daughter to try and collect more from her than they paid originally. It's a risky type of business venture that can pay off big time for the 3rd party company.

As an example,......... Down the road,....... Say a year from now, ABC CC company decides to give up and cut their losses. XYZ Debt Collections buys the $5,000 your daughter owes ABC CC Company for $1,000. Now XYZ Debt Collections starts calling your daughter and sending her letters in the mail trying to collect the $5000 originally owed. Sometimes people will pay the whole amount. Sometimes they negotiate it down to half. Sometimes the Debt Collector gets nothing. It's a gamble. But, XYZ Debt Collections can double/or more their initial investment just by buying up old debts for pennies on the dollar.

Problem for the person filing BK is,........ Both the filer and their attny still think ABC CC Company is holding the debt. So the notices of filing go to ABC CC Company and not XYZ Debt Collections. XYZ Debt Collections is not included in the initial BK filing and cannot be properly notified the debt is included in BK proceedings. It's really important to have all the right contact information prior to filing. That becomes more difficult if the debt gets sold down the road.

[SinkingFast]

JRagan-if she was behind for 7 months it might be an internal collections area (within the actual company) or they may have outsourced it to a collection agency.

Since you mentioned before that her payments went up 4 months into a 6 month goal, my guess is that at that point at least it was still with the original creditor. The recent increase in minimums was not within control of the creditor-all are required to make minimum payments include more of the principal.

That's another new law. It took effect Jan 1, 2006, but many CC Companies tagged customers in December, 05. Minimum CC payments must now include 1% of principal balance PLUS finance charges. Some CC minimum payments may have increased only a bit while others went up to double what the CC company was previously requiring. Each CC company's terms varied (before the new law) so the difference you see in each CC's monthly minimum payment can vary as well.

[StaciMM]

Sinkingfast-if you notify the original creditor, the debt is discharged even if it was sold to someone else. Its best to list any & all addresses/collection agencies/purchasers of accounts that you know of. That is mainly for your convenience though. By listing them, they find out sooner and stop coming after you sooner.

And JDB's pay 10 cents on the dollar, at most, for accounts... I've never heard of anything higher. One of the latest things I've heard about is companies buying accounts that are beyond SOL-meaning that they can't file suit. They'll likely pay under 1 cent on the dollar, but for any account that they talk someone into making a payment-no matter how small-the SOL clock starts over.

[jragan]

How can I find out if this "agency" is internal or a separate company?

I just saw Casablanca today. Great movie.

[SinkingFast]

I had read elsewhere to be sure you had accurate contact info or it could slow down the process and likely cause your attny extra work, translated $$$ for you.

I didn't know what kind of fig's to use. Just tossed out something for an example. Unreal how small an amount of money will get those sharks access to leaching off other people!!

[SinkingFast]

How can I find out if this "agency" is internal or a separate company?

I just saw Casablanca today. Great movie.

If you call the number listed on the letter, you will likely be pressured to pay something,.... Over and Over and Over again in the conversation, and find out very little information. That's their job. To get you to agree to pay whatever $$$ they can TODAY while they hold you captive on the phone.

Someone else may know a better way, but, I'd start with the Customer Service number listed on the back of CC. Or look on a copy of the statement for alternate contact numbers. See if you can find a rational person that will tell you what's going on.

[StaciMM]

Call the original creditor-they can tell you who is handling the account and whether they still own it, or they sold it.

[jragan]

does anyone know?

I had an interesting conversation with a paralegal. I had called to ask about medical bills. My daughter had a medical bill with a local hospital for $300. This was after insurance paid. The bill came to the house and my daughter was in school at the time and on our insurance. I started making $30 a month payments. The checks always cleared the bank right away and yet about 6 months into this we found out the bill was in the hand s of a collection agency. I called the financial guy at the hospital and he told me that $30 a month was not enough to cover the bill but, they would have taken $50. I was amazed. They always took the $30 and never told us otherwise. He said that was pretty standard. We should have called to make arrangements instead of just sending in payments. Each payment was put toward the debt and yet it was still considered as past due and a bad debt EVEN though we were making payments. I told him that I knew that they would not get all their money from the collection agency and he didn't seem to care at all. I would have paid him the whole thing. Is it just me or is this ridiculous. I ended up paying the agency because we did owe the hospital, I just couldn't understand that process at all.
Out of curiosity I called the lawyers office and that is where I had the interesting conversation with his paralegal. She told me that doctors and hospitals have the right to demand their money at the time of services. It is only a courtesy to allow us to make payments at all. I responded that it seems like people would be better offf to go to court and let the judge decide what is fair. Especially in my situation where we were paying. She then said, "Yes, you would.....no, no I take that back Ican't say anything else, I shouldn't have said that." I regret that I didn't go ahead and make an appointment with the attorney and just see what I could learn?
Anyone know anything about this?

I know quite a few people who to be honest are not worth a damn. They give nothing to society, they only take. They don't work or even take care of their own families. But, they can go to the doctor anytime and some government program will take care of them. Those of us who work several jobs and pay out the nose for health insurance take up the slack and get treated poorly by the bill collectors. I am not saying that I think someone should suffer physically because they are poor, I wouldn't even leave a useless person to suffer. What I am saying is that I am tired of it being the people who bear the burdens and carry the weight in this country suffering in more ways than one.
worried mom who has recently been really inspired by the Fair Tax book by Neal Boortz.