subject: Credit Card Help Desperate? [print this page] Credit card help a desperate need? You are not alone in seeking a resolution. We are taught from youth that we must pay our debts. Guilt is a normal feeling when the debt becomes unpayable.
Bankruptcy may be the simplest solution to get help. It certainly is one way to eliminate your unsecured debt. But not the only one available.
By negotiating credit card debt, you can also eliminate the debt. You can opt to pay it off at pennies on the dollar or you can wait and see what happens with the collection process.
Credit card companies are lenders. Many of them are divisions of the "big banks". The accounting rules and federal law require that they write off the balance of any credit card debts which are unsecured loans when those debts have become more than six months past due. So if you have stopped paying your credit card payments, six months from the last payment that you made, the balance will have to be written off or "charged off".
Written off does not mean that you do not owe the balance anymore. It simply means that the debt is worthless as an asset on the books of the credit card company. In order to recover that asset, the company will either sell the debt, again at pennies on the dollar, or attempt to collect a debt from you.
Once in this situation, collection of debts from most people is a foregone conclusion. Homestead laws and personal property exemptions take these assets out of reach. Retirement assets like 401ks, IRAs, and most insurance policies are also beyond the reach of creditors.
Records frequently get lost when debts are sold. Many times the debts are actually sold as notations on a longer listing of debts, with no records changing hands. That circumstance makes the debt extremely difficult to collect. if sued, an experienced debt collection attorney is really necessary.
