Posted on March 17, 2008 at 12:11 pm I'm in unfamiliar territory. A few years ago I divorced and used credit to compensate for the lost second income assuming I could refinance or sell my home to pay it back before it ever became a problem. Ex Wife is still on home loan and we are in dispute. Debt caught up last July and though I continued to send a small amount of good faith money to my creditors I am in collections ( I think). I have recieved collection notices but I continue to get billings from my creditors as well. My new wife is very close to obtaining employment which will improve our situation. How long will it be before my creditors or collectors put me in the court room which will force bankruptcy ? Is there any benefit to making a minimal good faith payment ? I have insisted from creditors and collectors that all communication be in writing and have refused or ignored phone contact ? Debt settlement vs. debt management ? Debt settlement / management companies want up front money to present to the creditor for program. What do I do with the creditors and collectors until that resource becomes available ? I am literally, paycheck to paycheck on just my necessary living expenses with nothing extra until my wife goes to work. Help !!!

Posted on March 17, 2008 at 6:55 pm You say your debt was caught up last July. If your debt is caught up, you should not be getting notices from collectors. Your creditors will send you statements which are really notices of the status of your account. I guess I'm confused about your situation. Are you, or aren't you, in a delinquent bill status? Knowing this, helps with answering your other questions.

Posted on March 18, 2008 at 9:36 am Debt caught up with me. I'm far from out of debt.

Posted on March 18, 2008 at 9:40 pm Circumstances got you in over your head? I believe everyone  knows about DEBT and the STRUGGLE to break FREE.But if we all grouped together we can help one another. Through my simple plan we can overcome DEBT. I`m offering this to everyone because I feel the middle,low income Americas need a real opportunity to escape Debt and learn they (we) do not need to buy on credit excluding autos,mortgages anything else we should be able to save for and pay with CASH. Ideally we should not be using Credit lines to purchase food,clothing,fuel,furniture,etc... Because status quo says: once you max-out that one CC you will be searching for another and another,and  then consolidating them into loans. After the loan gets you all paid up most people find there self in the same situation within three years.If anyone can relate to this you may want to give my plan a try with basically nothing to lose and everything to gain. please respond to usdebts@yahoo.com

Posted on March 31, 2008 at 11:58 pm I think the answer to your question about when you will end up in court entirely depends on the creditor and their collection practices. I don't know this for sure but I've heard it can take anywhere between 1 and 3 years depending on the creditor.

Posted on April 6, 2008 at 12:21 am Even making a small, good-faith payment will go in your favor in court. It shows that you're making every attempt to work out these debts in even a small way. Are there any expenses you could possibly cut back on for the short term that will help to increase the amount of small payments you can make?

Posted on April 15, 2008 at 4:34 am my payments have been far less than the minimum and some  creditors refuse to accept less than minimum. my debt is growing by leaps and bounds only this time i have nothing to show for it because it is all late fees and increased interest and penalties. this is why people tend to knee jerk react to jump into bankruptcy. while persons need to be responsible there should be some caps and protections in place on what a creditor can loan and what a creditor can charge. i did what i did out of desperation and hope that i'd be able to fix things before it ever became a problem. realitacly now, there was never any way i could afford what i was allowed to borrow on my income which the creditors all had up front.

Posted on April 15, 2008 at 7:42 am Honestly if you can't at least pay he minimum you might as well not pay nothing at all because the interest is going to over ride that in more ways than one.

Posted on April 15, 2008 at 1:02 pm OP, First of all, it’s very unfortunate that you have brought yourself into this type of situation.  But you have to understand that you are not alone and many people are in a similar situation. Things happen in life, and with the “credit crunch” we are experiencing in America today, it is obviously very difficult for many Americans to dig their way out of the mess.   When people are in this type of financial situation, there are actually a few debt relief options that they can choose from.  It is extremely important that you do your research before you commit to a solid decision.  I've listed the options below for you.   1.  Find another source of income - You can either find another job with a higher paying income as well as have your wife find a job.   2.  Consumer Credit Counseling - These agencies will try to call your creditors on your behalf to reduce the interest rate on the loan.  This type of debt relief will typically not help much in regards to the monthly payment since the maturity due date will be shortened which will off set the monthly savings that you should get from the reduction on the interest.   3.  Bankruptcy Ch.7 - This type of debt relief will eliminate all of your debts and forgive you from having to pay back your creditors.  In 2005, new bankruptcy laws were enforced since people were taking advantage of it; and therefore, it made it very difficult the general public to file for this type of bankruptcy.   4.  Bankruptcy Ch.13 - This is the more common form of bankruptcy that people will be able to qualify for today.  With this form of bankruptcy, debtors are still required to pay back a percentage of what was owed through some sort of payment plan.   My recommendation is that bankruptcy should only be considered as a worst case scenario due to the impact that it has on one's credit profile.  It may stay on the credit report for up to 10 years which makes it very difficult for anyone to qualify for new credit.  If this is an option that you seek then please find a professional and credible bankruptcy attorney in your area to find out more information.   5.  Debt Consolidation Loan - This is the traditional way of debt relief, but according to what you are stating, it may be very difficult for your father to apply for a new loan due to the current "credit crunch" in the U.S. Banking system.  Also, all a debt consolidation loan will do is it will transfer all of the existing debts from one or more accounts into a new account(s) with the intention of a lower payment.  At the end of the day, it may still take up to 10-15 years before a loan this size will be paid off and by that time you will be paying 2-3 times what you originally owe due to interest charges.   6.  Debt Settlement - Debt Settlement is a form of debt relief where expert negotiators will call a debtor's creditors on his/her behalf to get them out of debt by up to 40-60% of what he/she owes, get them out of debt in 2-3 years, and to cut his/her monthly payments by half.  This program is designed for those that are in a tough financial hardship and it is an alternative to bankruptcy.    These are basically the options that are available to your family members.  I hope this information was useful and that it may help you guys out.  If you need any more assistance, feel free to PM me! Good Luck!