[need2restore]

Hello, my husband and I have about 20k in debt from bad choices we made the past few years. We have a repo thats about 13k from 2003 and th e rest are charge off collections and credit cards that are closed but keep adding intrest every month. We are living with the in laws and hubby went back to school full time. Our bills are minimal, maybe 600 a month, including our car payment.

I think we have too much dispoable income for chapter 7 but I would like to consolidate all the debt and maybe pay just one bill every monthy but who do you turn to for this? I heard some debt consilidators take a percentage of your payment and it takes forever. Were hoping to buy a house in 2 years when he is finished school. Is their a fast repair program available that can get us back on track?

Or will mortgage companies incorporate your debt and a mortgage if you have 20k down?

Thank you in advance for your posts.

[Pale Rider]

What state are you in?

[Enigma]

If you are insolvent, then Chapter 7 is still an option. Otherwise, Chapter 13 is probably your best option. On $20k, the interest alone will out pace what ever you can pay on.

Two years looking to buy a house is really not a realistic option unless you can come up with about 30% down.

[need2restore]

We live in Pennsylvania,

What about a credit report advocate? I hear mixed feeling about them. Everything on our credit report is true, do they only remove false items?

[Hedwig]

You can do this yourself.

Get copies of your reports from each individual bureau. Don't use the trimerge reports you get online for your disputes.

After you get your reports, you want to go over them in detail. Highlight anything that is wrong--dates, amounts, type of account, etc. That is what you will dispute--the actual piece of data that is incorrect.

As far as paying them off, here is the quickest way:

Set up a spreadsheet of all your debts. In it, you want to list the creditor, the balance, the interest rate, and the minimum payment.

Sort by interest rate, with the highest first. Pay minimums on all of the accounts except the one with the highest interest rate. Decide how much a month you can afford to pay on it, and change the minimum column to that amount. So you will pay all extra on the highest interest, and minimums on everything else.

Each month, update the sheet. Each month make sure that all extra money is paid on the highest-interest-rate account. Try to keep the total payment the same, just pay minimums on everything but highest interest, all the rest on that.

When you get the highest-rate account paid off, add all of the money you were paying on that one to the minimum on the next highest-rate card. That's your new payment on that. Again, the total you're paying should be the same. You'll be paying even more on this card, because it will be the minimum from before plus the extra amount.

Any extra money that you get should always go on the highest-rate card.

As your credit improves, you may get offers for low interest rate balance transfers. Look at the terms and see if they're beneficial or not. I waited for "life of transfer" deals so that I didn't have something that jumped way up in a few months. But depending on how soon you think you can pay it off, you might want to consider it.

Watch out for the balance transfer fees, thought. They cost you money and effectively raise the interest rate. While they seem to be scarce these days, I got low interest and no transfer fees. So I'm saying that a low rate alone is not necessarily a good deal.

[Pale Rider]

Originally Posted by need2restore

We live in Pennsylvania,

The SOL for most items in PA appears to be 4 years. The repo may be past SOL in PA under state law and UCC. If the charge offs were the same time frame, then they should be close to or past SOL. The time frame would also mean that you would probably see all these items fall off your report about the time you were ready to purchase a home.

I'm not telling you to not pay back these debts, but it appears that you may be in a good position here, being past SOL. This gives you an advantage to negotiate in your favor. You may want to contact a lawyer in your area that can advise you further such as this one

http://www.pennlawyer.com/

There is no sense in putting yourself in a bigger bind by trying to pay something you can't afford right now. It won't help your credit score, it may restart SOL, and may cause you to be in a worse possition if you can't make payments you agree to with the collectors.

Take a deep breath, research, and find out what your rights are before you try to "do the right thing" and hurt your situation further.

[Hedwig]

PR is correct about not paying if they are close to SOL. I thought you had some credit cards that hadn't gone to collections but were still adding interest every month. You may have more problems with them, especially if you've been paying on them. The method I gave you would be good for that.

Can you elaborate a little more on how many accounts are in collections, how many are with the original creditor, are they being paid, etc. I don't know if making payments restarts the SOL in Pennsylvania or not. The repo, as PR said, is definitely close to being out of SOL.

[need2restore]

Wow, great info from everybody, thank you.

Ok in a nutshell here is what all the debt boils down to

13k, maybe more by now from the repo Americredit from Dec 03 is when they took the truck back, it was in default since October 03.

Dell computer from 06 in default balance is $2k maybe now now with interest.

Some charge offs from catalog orders that are at least 3 years old. maybe 3k

A home school for HVAC my husband signed up for but never finished $800.00 from 2005

A verizon cell phone bill, that I paid but lost the receipt from 2003, $375.00

A eletric bill from 2004.

That stuff is old. The new stuff are the creit cards.

last year we made the minimum on all cards then m yhusband lost his job right after christmas and could no longer make the minimums and here comes the craziness!!

haven't made a payment in 3 months on any of these cards
Sams club credit - $400.00 .
Orchard bank - each have one of these
HSBC credit cards - each have one of these
mastercard - each have one of these

all these cards started out with a $300.00 and $500.00 balance and every month I get slammed with over limit and late fees. I cancelled I think all of them but still getting late fees and interest???

I know this is a lot of info but any info I can receive would be greatly appreiacted. Were not low lifes that don't pay their debt, we just had some rough patches over the past few years and paid what was more important. I have a car payment that I pay on-time every month but is doing nothing for my credit score.

thank you

[Pale Rider]

Originally Posted by need2restore

A eletric bill from 2004.

Utilities are a different ball game. Even if it is past SOL, the debt may not be classified as "credit", and may not have the same rules as other debts. The utility may be able to require much larger deposits, or require payment in full before they will allow new service. You may want to research this one and pay first if you will be needing service from them in the near future.

[need2restore]

THis waws in Pa where we currently live but we are planning to move back to SC in 09, so I'm not too worried about it.

I did pull our free credit reports yesterday and some of the charge offs and utility bills are falling off next year.

Do you have to send a letter for it to be removed or will it just go away by itself?

[Kookie]

It will go away when that date comes (or is suppose to) on its own, but you still must keep an eye on it to make sure they actually did take it off when it is scheduled to be removed. If they failed to remove something by the estimated removal date, just a simply phone call to the CRA will get it removed. I'm speaking from experience here.

I found too that transunion kept some bad debts on my report for 2 months longer than the other 2 CRA so called Transunion and disputed the removal date of all those debts that had fallen off my other reports and within a week Transunion sent me a letter and next to those accounts was the word "DELETED"