debt collection law firm called me... need some legal advice

[cheezit]

ianl but I would ask the debt be validated, I would varifiy the co collecting the debt in texas is legal to do so.
Texas has some unique requirements to collect debts in this state

[G26ster]

so back afew years ago i had some heavy fiancial issues and had to use credit cards to survive. now i am making it by with a few dollars to put ino my coffee can.

my credit has been shot for some time now, it dosnt efect me, i dont plan nor need credit as now i have my finances together andeverything is paid off. except my house.


i know in texas credit companies/ law firm cannot garnish wages. only for student loans, child support, and income tax. (or so i have read on google)

what can they do?? they are offering me very unrealistic payment options. I can deal with the phone calls and i can change my number if needed.

whats my worst case scenario? what do they have the power to do in this great state?

thanks g27

If everything is "paid off," what debt is there to collect?

[The Annoyed Man]

Back in 1990 or so, my wife and I got into trouble with credit card debt. Our bad, but we ended up with a situation where I couldn't make all the minimum payments, and we started getting behind. So we went to the Consumer Credit Counseling Services of Los Angeles. We WANTED to pay the debt off, but we needed some help to get it organized because we were just stupid about it. As I recall, the total amount of the debt was in the vicinity of $24,000, on several different accounts, which included credit cards, gas cards, store cards, etc.

CCCoLA was a non-profit, partially funded by government grants, to help people discharge their debts honorably instead of just walking away from it. Like I said, we really wanted to pay it all off. But I've got to be honest....the single biggest stumbling block for me was pride, and I probably delayed seeking help for a year or more because I was ashamed of not having my financial act together. Going to get help was an admission that I was unable to do it on my own, and the control freak in me didn't want to admit that. It took a willingness to humble myself to get it handled.

What CCCoLA did for us was make arrangements on our behalf with all of our creditors, securing lower interest rates and better terms. The idea was that the smallest balances would get paid off first, and as each one was paid off, that month amount was rolled over into paying off the other accounts—snowballing the paydown. They then helped us to figure out a budget that we could live on after making the monthly debt payment. They even budgeted monthly entertainment. Every month, I wrote a check to CCCoLA for $830.00, and they would turn around and pay our creditors according to the arranged payment schedule. It took about 3 years, but we paid off every penny we owed. All of it. I thought for sure this would ruin our credit, but it actually improved it....it was ruined before we went to CCCoLA. But afterwards, we were still able to buy our home at a decent interest rate, our credit picture improved, and shortly after that we got onto an entirely cash basis.....where we are still today, 20 years later, with the one exception of a Lowe's store card.

Many of these techniques are taught by Dave Ramsey and other financial teachers, and they are available to you for free through churches and municipal programs. You just have to be willing to set pride aside and accept the help. If I were you, I would find out what programs are available to you in your area, and I would take advantage of that. You absolutely CAN take care of your debt AND have a reasonable lifestyle.

When we did it, one of the first things that happened is that the collections calls all stopped. That alone made it worth it.

Just a thought.....

[Teamless]

I don't know what they can do, but according to Dave Ramsey, if you have some money, make a "Paid in full offer" for pennies on the dollar, if they accept, get it in writing and NEVER let them draft your account.
ONLY send them money orders or cashiers checks.
If they turn down your offer, tell them that is the best they are going to get.
When they call tomorrow, make the same offer, eventually they will accept it.

[The_Busy_Mom]

Well, they could repossess anything that is tangible. For instance, you bought a bunch of furniture at rooms to go, and put it on the card. They could come try to repossess the furniture. But that rarely ever happens with big corporations. You creditors could file a civil suit against you, and then if they win, they can garnish your income tax returns. I've done that on a personal level. But for the most part, they are going to annoy the snot out of you with phone calls. Phone calls to home, to anyone you used as a reference, just absolutely annoy you with calls. I would send any annoying creditor a cease and desist letter that informs them all further communication is to be in writing, via certified mail, to their address on file. Any further communication outside of written communication will be forwarded to legal counsel. That generally puts the kabosh on the phone calls. Then, work to get the debt paid off. They will eventually begin to offer you a settlement just to get the account resolved. Most settlements come right after Christmas, when everyone has gift money, and during tax season, when they think you are getting a refund from the Big Brother. Offer them a deal - "Look, the balance that I actually spent was $200. I paid that off several times over, and what is left is all the crazy fees and compounded interest. I'll offer you $200 to consider the account paid and closed, and reported to credit bureaus that the account was paid as required, and closed with $0 balance." They may not take it. Eventually, though, they will come around. It may be sold several times before you get someone willing to make a deal. But other than repossession, and civil suit, not much else they can do (that I am aware of).

Of course, I am not a lawyer, and nothing in this message should be construed as legal advice. YMMV!

TBM

[JALLEN]

My understanding is that Texas is very tough for collections. The homestead exemption deals with the size of the property, not the value like here. IIRC, outside the city limits, up to 200 acres can be your homestead, and inside the city limits up to 10 acres, regardless of value. I also believe that personal property can be excluded from seizure, certain items, a car for each adult, tools of the trade or profession, etc. I'm not a Texas lawyer or even a Texas resident just yet, so I'm still learning about these things.

One thing you can do is look up the Fair Debt Collection Practices Act 15 USC 1692 et seq. found here: http://www.ftc.gov/os/statutes/fdcpa/fdcpact.shtm. This gives you certain rights, and requires the collector to avoid certain acts and practices. Give it a read, get familiar with the requirements.

I have been in a collection business of sorts here for many years. My experience is that most creditors will go to considerable lengths to work something out with someone who is sincerely trying and has some prospects of being able to do what they say. Many people squander this flexibility by being prideful, or unreasonable or defensive, getting them nowhere. This presumes that the debt(s) are fair ones, not errors, etc. Other times, the creditor is unreasonable, merely trying to intimidate folks, scare them into paying, making it a scary, horrible experience they want to just get behind them.

[MotherBear]

Definitely do some reading at Dave Ramsey's website, or call him, or see if you can find a Financial Peace University class near you (generally scholarships can be arranged, especially through churches, so don't let the cost scare you). He talks a lot about dealing with collectors, ensuring they abide by the fair debt collection act and don't make your life miserable, and getting your finances in order so you can get the collectors out of your life. He has some great material on dealing with them. There are rules about when and how they can contact you, what they can say, and who they can say it to... but if they think they can get away with ignoring them, they will.

[JALLEN]

When we did it, one of the first things that happened is that the collections calls all stopped. That alone made it worth it.

Just a thought.....

and a very good one it is, too. That works like an informal Chapter 13 bankruptcy case without the court involvement. Thankfully your situation was susceptible to being managed, with some discipline and want-to. Many are so hopelessly in debt that it is not so easy.

Make sure you are dealing with a reputable credit counseling outfit. Some are little more than fronts for debt collectors, others are frankly scams. Our maid came to me some years ago with one. She was nervous about signing up, I looked into it, the hype, high pressure, glib assurances of blissful peace the instant you signed up, a healthy fee spread out over the program....... the counselor outfit became one of her largest creditors!

I showed her how to make these arrangements on her own, gave her some sample letters, etc. and hopefully she followed through. I heard no more about it.

[TexasGal]

Unfortunately, my son has a huge medical debt and no job for quite a while yet. Even then, it is doubtful he will be able to pay off the near $100k he owes on a low wage job ever. He is getting calls on some of it already. I don't know if medical bills are treated differently in the law than debt for things and stuff. I think he will have to go through a bankruptcy, but if he didn't, what's the worst they can do to him? Even bankruptcy costs money and he doesn't have a cent.

[ffemt300]

I second all the Dave Ramsey advice. Financial Peace changed our lives. Debt collectors are the scum of the world. They break the law all the time and will resort to insulting you and your entire family to try and solicit an emotional response from you to try and get your money.

The four basics are : Food, Housing, Clothing, and transportation.
After that I'll pay on my debts, but if I dont have the money that month THEY aint gettin paid.

[Purplehood]

Back in 1990 or so, my wife and I got into trouble with credit card debt. Our bad, but we ended up with a situation where I couldn't make all the minimum payments, and we started getting behind. So we went to the Consumer Credit Counseling Services of Los Angeles. We WANTED to pay the debt off, but we needed some help to get it organized because we were just stupid about it. As I recall, the total amount of the debt was in the vicinity of $24,000, on several different accounts, which included credit cards, gas cards, store cards, etc.

CCCoLA was a non-profit, partially funded by government grants, to help people discharge their debts honorably instead of just walking away from it. Like I said, we really wanted to pay it all off. But I've got to be honest....the single biggest stumbling block for me was pride, and I probably delayed seeking help for a year or more because I was ashamed of not having my financial act together. Going to get help was an admission that I was unable to do it on my own, and the control freak in me didn't want to admit that. It took a willingness to humble myself to get it handled.

What CCCoLA did for us was make arrangements on our behalf with all of our creditors, securing lower interest rates and better terms. The idea was that the smallest balances would get paid off first, and as each one was paid off, that month amount was rolled over into paying off the other accounts—snowballing the paydown. They then helped us to figure out a budget that we could live on after making the monthly debt payment. They even budgeted monthly entertainment. Every month, I wrote a check to CCCoLA for $830.00, and they would turn around and pay our creditors according to the arranged payment schedule. It took about 3 years, but we paid off every penny we owed. All of it. I thought for sure this would ruin our credit, but it actually improved it....it was ruined before we went to CCCoLA. But afterwards, we were still able to buy our home at a decent interest rate, our credit picture improved, and shortly after that we got onto an entirely cash basis.....where we are still today, 20 years later, with the one exception of a Lowe's store card.

This will work if you are serious about cleaning things up.

Many of these techniques are taught by Dave Ramsey and other financial teachers, and they are available to you for free through churches and municipal programs. You just have to be willing to set pride aside and accept the help. If I were you, I would find out what programs are available to you in your area, and I would take advantage of that. You absolutely CAN take care of your debt AND have a reasonable lifestyle.

When we did it, one of the first things that happened is that the collections calls all stopped. That alone made it worth it.

Just a thought.....

BTW, if you consider the 'offer' suggestion you ALWAYS have to get it in writing. If you do not they can and will take your money and still demand the balance of the note.

[Ericstac]

How old is the debt?
Is the debt collector the original owner? Was the debt sold to a debt collection company or are they just collecting for the company?

Good news is your in Texas.

Before you do anything, don't do anything... Make sure you don't pay them a dime as the statue if limitations is four years on debt so if/when it goes past this time you will have made it past the biggest obstacle.

I've known two separate people that had debt problems and they took two different paths.

1. Took the credit counciling service route. Made the payments necessary and ten years later still has bad credit. It hangs out on your credit like a rotten apple.

2. Took bankruptcy chp7 route. Within three years had his financial life turned around, bought a $400k house, financed cars with no problems at low rates, had credit cards, etc.. He had the bankruptcy on his credit but it was a thing of his past and with income and a rebuilt credit history since bankruptcy allowed him to move on..

Most would wonder why? The 2nd man did a chapter 7 and didn't pay any of his debts, that's real bad.. The 1st guy was a standup guy and paid all his debts so why wouldn't that way be more successful for his life? The important thing with credit is if its bad it needs time to disappear. Companies understand and are willing to take risks on people because they know people change and if they see that on your credit then your life gets easier.. Being in credit counciling is just as bad as a bankruptcy chp 13. As long as you are in it you have really bad credit.. Once you finally paid everyone off years later your time clock starts over..

Don't look at debts as you need to be honorable and pay it off. Debt and credit is a business that has turned into a game really. They make a killing doing things what mean feel is just not right. They have come up with every little penny snatching way to steal your money to increase profits.. That's why they take such high risks they know in the end they win.. Well in this game the people have a play book as well and if used right we might get bruised a little but we will get up to talk again and if don't right they don't win.

I remover talking to the second guy and seeing how he had a debt that they were trying to enforce a payment that was four times higher than original debt.. 3000 turned into 12000... And they would settle for 40 cents on the dollar so they were still going to make a lot more than the original debt.. He also had a card that was in good standing but near max around 10,000.00 that went from 8% rate to near 25% rate and they wouldn't lower it until his debt to income ratio was improved.

[anygunanywhere]

Do what you need to do to pay back every penny.

A large prtion of what we pay for our goods and services is because many do not pay for theirs.

Anygunanywhere