The Dolphins Make Me Cry.com - Forums

A co worker of mine just got a settlement from his insurance company for an accident he had. He called his Credit Cards  (I was there listening on a lunch break) and he got his cards to settle for 40% to pay them off! They said he would have to put in a 1099 form and claim it as income but they forgave his Credit card debt for a little over half of what he owed because he had available Ca$h. He told them he was thinking of going into bankruptcy (complete bullshit) would they like to settle instead.

Just some Info for those with the available assets to do that.  (I wish I did).  :|

I've heard similar stories.  I wish I could settle and not be penalized.

I'm doing this with my hospital / doctor's bills.

Thank god for being debt free!!! sorry. :|

Liquid assets?  What's that?

Oil, wine collection, 100 year old brandy. 

They did tell him that it would show up on his credit for 6 years as a settlement. That's the only penalty. He figures he has paid them so much interest over the years they are still making out big time.  But he's got a clean slate for 1/2 of what he owed.  I was thinking it over with my wife and I'm gonna ask my Dad if he could swing an interest free loan. If my company settles for half as well I could have my Dad paid off by New years if I sign up for enough OT. Trick is to stay debt free if I can make this happen.  ;)

Good move. I try to avoid credit by all means possible. If I don't have the bread...I just don't spend money.

They need to overthrow the credit system. We need another Boston Tea Party minus dressing up in costumes!

 

  Not knocking what your friend did. 

However, people wonder why we are such a crisis.  People want to spend today, because they cannot delay a purchase until they save for it,  then not pay for what they buy & its the credit card companies fault.

Gotta love America.

No doubt. Its gonna be different times ahead for everyone. I wanna get cleaned up and completely debt free except for the Mortgage and the Mini Van . Dads gonna get back to me in the morning . Looking like this might actually work.............

Dude........its the interest. He's paid his debt and then some.  But no doubt we gotta shoulder some of the blame as well. 

Just a few weeks back I started putting myself on a little budget. I took out a set amount of Ca$h for the week instead of just charging Lunch and what have you. When I started to physically Pay for things instead of just charging it was completely different . Suddenly I'm skipping this or that all together because I don't want to spend the money in my wallet. To charge things was mindless.  I'm guilty no doubt and in need of change. I think many many here in America are gonna be tightening things up over the next few years. 

What?

You're missing out on paying $.40 on the dollar!  Go on a huge spending spree and rack up over $10,000 in new toys ... and then pay it off for $4,000? 

Your responsibility in paying full price is un-American! 

Ever other commercial on the radio is something about paying off your credit card for pennies on the dollar.  Someone is paying the difference.

If you have good credit and the equity, get a home equity line of credit and pay off the mini-van.   ;)

Good move by your buddy, Defense.   If you settle, it doesn't hurt your credit score.  A bankruptcy on the other hand would totally trash it. 

  Interest is a killer.  Had this talk with a spending Co-worker who is in debt over his head, because he does not know the words, no, wait, save.  He told me has does not factor in interest.  I had to explain to him why he should & how interest works against him.

 My sister has been in this type boat for over 20 Yrs.  Why?  She cannot stop spending.

If she owed a CC $5000 & the minimum payment was $25, then she paid them $25 & reduced her principal $4.



  Good job.  I charge just about everything I purchase.  However, I pay it off every month.

I use 4 cards.  Each close a week apart from each other.  I use the card that just closes that way I get to use their money for about 2 months before I have to pay.  If I want to float a purchase then I simply use the money I charged the week after it closed to pay off the current bill.  That way there is no interest I have to pay & I float the purchase & pay it off slowly each pay day.

Better check again Tommy. It's settled but it still goes against you as a charge off.

Thats true. But whats the Big deal? I already own a home and a 30 year fixed Moorgage.  I have perfect credit for over 25 yrs but I see absolutely no big Loans on the near Horizon. I'm gonna get myself straight and just stay that way. Probably No season Tickets for a long while either. (Although I am paying off the Big Screen ;))

Credit Card companies are so screwed up No one is gonna have good credit. I'm gonna clear my Tab fast before they start upping the interest............. :|

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It would say "Account closed by credit grantor".  Not necessarily a charge off. 

How does this work? If one does not charge anything, or pay their balance off every month how does one get bad credit?

You don't get bad credit that way, but you don't build it either.

Simply Put. These companies are backed by Banks. I don't think I need to remind you of how many banks have over extended themselves ? No banks = No credit no matter who you are. Those that do get it are going to be paying High Intrest rates. The Days of the intrest free card will be long gone for a while.

Exactly...........but my point being there will be nothing to build credit for anyway for a while. Banks are going to be concentrating on getting the House market moving again. They could care less about your Home Depo or Jetsons appliance credit card in the near future.

Of course you build credit that way.... why wouldn't you. As long as you have accounts in good standing that are open, you are building credit

I built credit that way.
 
I sitll don't see the issue here. Spend cash.

No doubt. But you will be spending your own........not theirs. Their deep pockets just hit bottom.

Doing it that way will affect his credit for quite some time.

I actually do this type of work for a living.  I either go to court or get settlement around 15-30% and have a lesser impact on credit scores.

When I go to court, many times I get the entire case dismissed and the client owes $0! :-)

My understanding is you have to owe money and be in good standing to build credit. Showing that you owe nothing usually hurts your credit scores. Minor debt is looked at better than no debt in that world.

So what's our incentive to spend wisely and pay our debts?

Nothing personal, but I think this is part of what's wrong with this country.  Good people, "shmucks", work full time or more to honor their obligations.  Others are allowed to walk away scott-free.

Not true. My credit was in the garbage and I have a couple cards that I use every month and pay off every month and my score has improved quite a bit.

There are many incentives to spend wisely and pay our debts.  First of all, nothing in the law is gauranteed... you may wind up owing more than your original balance (ie: attorneys fees, court costs, interest, etc...).

Its also important to note that the credit card companies are not always innocent victims here.... as I am sure you all are aware.

I would add so many more, but right now my time is very limited... I will make another post as soon as I can.

Agreed. My credit wasn't bad, really. Just mediocre. I was told to get a couple of cards. Charge on them. Then pay them off. I've done this consistently and now my credit looks really good.

Thats good and obviously it worked if your buying a new home.