How to fight back against Credit Card companies

[Malthus Revisited]

Unsecured consumer debt, my friends, is a thing of the past for the vast majority of us. With the secondary securitization markets locked up for the foreseeable future, banks will finally have to charge rates that are realistic. This will have a natural limiting effect on creation of new credit lines.

Well, this isn't quite true. I have tens of thousands of dollars of unsecured debt based on unpaid hospital and medical bills. Prior to that, I had a completely blank credit report, as I haven't had a credit card since 1985 (I knew I was just not the type of person who could resist using them, so I just didn't get one). Nevertheless, because of those debts, there are a lot of jobs I can't be hired for and apartments I can't rent. So even if you don't believe in credit and don't use it, you can still be screwed by credit reports and by debt.

A couple of people have mentioned these collection agencies that buy up outdated debt and try to collect on it. These are the most unscrupulous collectors I have ever run across. Kooks. They actually threaten to put people in jail, call them obscenities, and tell all sorts of lies.  I have made a couple of them stop harassing me after I reported them to the BBB. What they did next was to sell the same debt to another company. Then you have to report THEM. But it does slow them down.

It is true that if you tell them not to call, they won't, although they usually will start calling again in the few months. You have to tell them in writing for it to be "legal." I did have one collection agency (of the kook variety I describe above) continue to harass me after I sent them two letters denying the debt and telling them to stop contacting me; I had to file a complaint with the state attorney general's office to get them to stop. However, when you send a letter forbidding further phone calls, that also kind of gives them the go-ahead to take you to court. In my state, if they get a judgment against you, they can go back to the judge and get permission to seize your bank account. I suppose they could seize your customers' payments if you had a brick-and-mortar store and they got a judgment against you and then got a judge to say it was okay for them to seize your customers' payments, in which case you would have to declare bankruptcy to get them to stop. I have never heard of this happening, though, and I hang out with plenty of merchants.

There is such a thing as being judgment-proof. But it means you really can't own much or have any kind of easily garnished income, like a wage.

Just like to add my own .02 here.  About 5-6 years ago I got over my head in cc debt and ended up having them all charged off, had the harassing phone calls, etc.  I hired one of those debt consolidation firms to help me, but they didn't really do shit.  I eventually figured out on my own that I could talk to the collectors personally and get them to settle for 25% of the debt, they but it for pennies on the dollar so that is still a huge profit for them.  It was easy enough, I'd save up a chunk of change, and when I had to talk to them I'd tell them I had enough to settle one card, so whoever gave me the best offer would get the settlement, and they knew damn well I was telling the truth because I'm sure they could see my credit reports.  Anyway, I settled all of them except my highest balance, which was a card that had a $7300 balance when I stopped paying, and which a collector was now saying I owed $25,000 on with back interest and fees!  I refused to settle that, and they actually sued me, I was served with papers and everything.  I got a lawyer who reviewed the documents and filed a counter-claim (or whatever it's called), and they immediately dropped the case.  Their case was pretty sketchy to begin with....the documents consisted of copies of copies, badly recorded and with no clear history of debt, accounts, or information, as the debt had obviously been sold to numerous creditors who all failed to collect on me.  I think they were simply looking for a summary judgement against me so they could try to garnish wages, I expect that most people they do that to either can't afford a lawyer (it cost me $1500) or it doesn't occur to them to do so, so the collector gets a summary judgement and then can try to garnish your wages and/or assets.  But once they saw I was willing to spend money to put up a fight, they immediately dropped it.  I never heard from another collector on that debt again, it was almost like they marked it as uncollectable for anyone else who might be interested since I'd put up a fight lol.

Oddly enough (or perhaps not I suppose), I am back in the same situation.  I was able to actually rebuild my credit rather easily, I even had a Discover card with a 9% interest rate and a $3000 limit, as well as 5% cashback, after being sued and all that other nonsense, so don't believe the hype about your credit being ruined forever.  I was able to rent an apartment fine as well, although it probably helped that I'd settled most of the debts and they had been several years old.  At any rate, I'm back with the charge offs again and multiple calls a day from collectors, and just waiting it out once again.  The calls eventually die off as they realize you won't answer and are a lost cause (I don't have any assets and only make $30k a year).  The calls for now are still annoying though, and I'm aware that you can send them one of these cease and desist letters to get them to stop.  As paracelsus stated above however, my concern is that by cutting off their ability to harass me by phone, their only option to collect then will be to take me to court, and I don't have the money for a lawyer this time around.  If the worst I have to deal with is leaving my cell phone on vibrate, then I can deal with that.

Anyway, I just wanted to share my own experience there.  Defaulting isn't the worst thing in the world, and you can rebuild your credit, mostly it's just all the annoying phone calls.  But it's much easier and better I think than declaring bankruptcy, although it also helps not to have any assets that can be seized.  Most importantly, find out a good debt lawyer and maybe touch base with them to see what they can offer and might charge, and have their number handy in case one of these assholes does try to take you to the cleaners.  I can almost guarantee you that the minute they see you have professional legal counsel, they will tuck tail and run.

[ArmaGoof]

@Malthus - you are brave to bare your financial soul on this forum!  Some around here would lay into you for your spend-thrift actions.  OTOH, the CC companies asked, nay begged you to do it.  When you think about it, giving other people money is pretty stupid.  Seriously, how many times have we loaned someone $20 or whatever, fully expecting it to be repaid, and then got stiffed?  It's a lesson individuals learn quite early in life: "never give money away you aren't willing to never get back!"

Stupid is as stupid does.  No sympathy for the thieving bastards here.  'Course, they'd call you a thieving bastard as well.  But beggars can't be choosers.

Ultimately, the debtor is in control.

[paracelsus]

MalthusRevisited, did you ever check your credit report since then to see if that debt is on there?

[Malthus Revisited]

MalthusRevisited, did you ever check your credit report since then to see if that debt is on there?

I haven't looked at in in a long time since I don't care anymore, but last I did only the original debts were listed, and they were shown as charged off/settled.  For some reason the collection agencies don't show up on there as a debt owed.

Oh, and FWIW, I'd built up my FICO score to a 705 before I fell apart again, which was as high as friends of mine who've always been good proles with their credit.  Just further proof to me that credit is a crapshoot.

[akaskip]

 I had three Capital One accounts and a Merrick bank card account, in the last few weeks all have sent me letters that they would be charging me annual fees , no balance on the cards, no missed or late payments ever and have been with them for years , needless to say i have cancelled all accounts with these companies, the capital one rep was fine with me cancelling the one account and said they were very sorry to see me go and then i said hold on a minute and gave the number to the second account and said i am closing it also, she said the same thing sorry blah blah blah and then thank you and i said hold on and then gave the number to the final account and there was silence, i said hello are you still there, hold on i need to get my manager , the manager comes on and says they would be willing to waive the yearly fee on the last account since i was such a good customer, i said that's okay i don't need your cards and have a nice day and remember the reason why when your at the unemployment office, you let good customers walk and deserve to go bankrupt.

  I say screw all the SOB's and laugh every time i hear anything about CC reform, it;s a F'n joke

[GetGoing]

I have only 3 credit cards and carry no balance on any of them.   When I do use them I only purchase what I can pay off in full each month.   I only have one income (retired) so I am very prudent in the use of the credit I have.  Instead of using my debit card for weekly expenses (food, gas, misc.,) I withdraw my weekly cash allotment (times 4)  and pay cash for all my transactions.  Exclusive of the regular monthly bills of course (mortgage, electric, phone, vehicle, etc.).  It seems the money lasts longer (with a surplus on occasion) when paying cash instead of using the debit card.  Oh yeah, I have NEVER paid an overdraft charge or bank fee and as long as there is a breath in my body, I won't!

Getgoing

[Chesyre]

my FICO score is 762  , 762 Nato that is 

[jakam75]

I have had a bank of America card for about 9 years.  Have been meaning to cancel it for a while but just haven't.  I realized yesterday that it was due (pay it off every month) so I called them, waited on hold for 15 minutes.  I told the pleasant sounding woman that I just realized that my payment was due and would like to pay it with my debit card.  No, sorry, can't do that, but give us your #s off of a check to pay it.  Oh and it will cost you $15 to pay your bill.  Well I don't really have a choice so I do it but I tell her that it will cost them a 9 year customer.  Do they give ****?  Nope!  Evil bastards!

[roccman]

Years ago Roc said max out yer Credit Cards buying Gold.

I think he was right. 

Perhaps - got nailed to the wall here and at po.com ("Pops") for encouraging this behavior, but again class - can't eat a FICO.

[excop95]

Years ago Roc said max out yer Credit Cards buying Gold.

I think he was right.



To my knowledge you cannot buy gold bullion/coins with a credit card. Cash up front or a bank draft. The transaction is verified before delivery. If you could buy gold with a credit card we would have all maxed out our cards for gold. Someone correct me if I am in error...

[ninakat]

excop95, APMEX accepts credit cards for transactions up to $5,000 -- I haven't tried that, but it's listed on their FAQ page.

http://www.apmex.com/FAQ/Default.aspx

[TheWarriorMax]

Australia is generally accepted as being less affected by the GFC than other nations. Our banking system is touted as being rock solid.

However, Citibank must have been clobbered by the GFC and Dubai. I owe them $8,000 on my line of credit that's about 10 year's old. i figure'd I'd paid them enough in interest and stopped making payments when they got bailed out.

Now they just advised me they will accept $4,000 as full settlement. 50% discount and in Australia, that won't be classed as income as it's not a commercial debt (to me). I should have offered 25% to see if they'd bite... 

Anyways, I figure they are feeling the pressure and need cash. There are ads in the Financial Review offering 6% for 12 months on $25,000 New Funds. They must be haemmoraging cash and are willing to forego $4,000 to get something in the door.

The boss and I were making bets as to how long it will take them to forget this and start sending me offers in the mail again...

[jakam75]

got a card last year from a major retailer so i could get 10 or 15% off of a tv, my old one was a 15 yo hand me down.  haven't used it since.  got an account notice yesterday that said my apr was going up 5% or I could opt out and the card would be cancelled.  so i called and told them that their interest rate is usery and WRONG! I am opting out.  They tried to sell me on the new no late fee part of it but I said no thanks.  So they let me keep my old interest rate if I kept it open.  The squeaky wheel always gets the grease.

[JeffreyET]

Last month the bill on my business CC was only $4. I thought, I'll just let them charge me their 20% until next month, its not worth the time, paper & postage...
WRONG. $29 Late Fee! GOTCHA!!

Well here's an idea. I'll OVERPAY my bill by, say, $1.02 & see how they like playing around with papers & computers for a few decimal points.

[doctor zaius]

The best way I know to fight back against credit companies is not to get into debt in the first place. Pay off your whole balance every month. Don't buy stuff you can't afford.

If your credit company still tries to screw you, just cut up the card, mail it back to them, cancel your account and tell them to go fuck themselves.