several problems from using a debt settlement company

[animatorindebt]

I had good credit 4 months ago. Due to being laid off twice in 2007, our credit cards ballooned to an unmanagable amount. In an attempt to be responsible about it, I contacted a debt settlement company and after discussing it with them, used their service, paying them monthly installments for 4 months with the intent of paying off my debt.

What i didn't realize was that I was essentially scammed and they just wrote cease and desist letters to my creditors, letting the accounts fall into collection. When I called them about this, they said it was what I had agreed to and my credit would be perfect in several years.

In learning more about credit, this claim turns out to be specious for many reasons.

I quickly called my creditors and worked out a plan with 2 of 3 of them and my accounts were reaged so as to not have a late payment on it and a monthly plan was worked out (which was what I thought I was doing initially)

The third card, Bank of America/Fia will not negotiate with me and has referred the account to Creditors Interchange, who are calling daily and demanding the account be settled immediately, as it's about to go into legal action.

In googling Creditors Interchange, it seems they have a history of harrassment, including calling one's coworkers and threatening legal action where none may be intended.

This whole ordeal is a shock to me, and I'm trying to get my bearings, and figure out how to salvage my credit as best I can now that this one account is in collections.

Any advice would be of help, as my worst nightmares have come to light, and the idea of my home being jeopardized, as well as any chance of getting a decent loan in the future is frightening.

regards,

animator in debt

[hannah]

First of all you should file a complaint with your state Attorney General about the debt settlement company. If they were not an in-state company, also file an Attorney General's complaint with the state they are in.

Next, I need to know what state you are in and if you have received any letters from Creditor's Interchange.

If legal in your state, you also need to start recording their calls.

[animatorindebt]

i don't have the means to record their calls and they've been highly deceptive.

I'm in california and just received a letter yesterday from Creditor's Interchange, which is in Buffalo, NY.

Do you have a link to the Attorney General?

[hannah]

Quote:

Originally Posted by animatorindebt i don't have the means to record their calls and they've been highly deceptive. I'm in california and just received a letter yesterday from Creditor's Interchange, which is in Buffalo, NY. Do you have a link to the Attorney General?

Here's a link to New York.

And here's one for California.


More info later.

[animatorindebt]

complaint filed..thanks!

[hannah]

Quote:

Originally Posted by animatorindebt complaint filed..thanks!

Next you need to send a validation letter to Creditors. I will post what you need to send tomorrow. Hang in there.

[animatorindebt]

I've seen some sample letters online about debt validation. Would this just buy me a month, or mess up my credit further as well as my chances to negotiate with the collection agency.

just a little confused on the best way to proceed.

[jlynn]

Well, if the debts are newer, a few CA's will validate - sometimes it is just a time buyer. It *shouldn't* mess up your credit any further, and if you send off a validation letter before the CA starts reporting to your credit report, it might even save your report.

I have never heard of a DV affecting someone's ability to negotiate with a CA - they either will or won't its more so dependent on the who the CA is.

[animatorindebt]

the letter I received from the CA states..

"your account is seriously past due and ...has authorized CA to initiate collection efforts to recover the total due as noted above...

No one has yet submitted the necessary paperwork to file a litigation or arbitration claim agains you. However, if you continue to neglect your oblicgation very much longer, FIA CARD SERVICES, NA intends to send your account to a collection law firm. The lawyers may initiate legal proceedings in an attempt to remedy the outstanding amount due..."

If they are threatening legal action, does that mean it is imminent, or is it also a negotiating tactic to scare me.

[hannah]

Quote:

Originally Posted by animatorindebt If they are threatening legal action, does that mean it is imminent, or is it also a negotiating tactic to scare me.

Both or neither one. You just never know.

As for the DV letter,

Dear CA,

I am in receipt of your letter dated XXXX and wish to thank you for contacting me in regards to this alleged debt. Please be advised that I dispute this alleged debt and demand you validate it pursuant to state and federal law.

Thank you for your kind attention to this matter.

Sincerely,

animator

Do not sign it but instead use a script font where your sig would go. Send it CMRRR and keep a copy in a file with the letter received from Creditors. When you get the green card back, put it in the file as well.

You should go to Radio Shack and ask them for the cheapest set up you can purchase to record phone calls and they can help you if you wish to record the calls.

California has some strict laws regarding debt collection. I would look them up for you tonight but I am tired. Will do so tomorrow.

[animatorindebt]

thanks for your help