“My wife lost her job last August, I’m in commercial real estate in Arizona and I was hospitalized in November.

After reading a debt settlement book by Mandy Akridge, I formulated a plan to tell “my story” to my creditors, keep individual files noting balances, days late, etc and hope to settle my debt.

As of today, we owe the following:

Citibank (unsecured): $32,000, 72 days late
Bank of America (unsecured) : $7,300, not yet late
Navy Federal (unsecured – now) $28, 511, 40 days late.

Navy Federal is very aggressive. Previously, my credit card debt was secured with a car loan I also had through Navy Federal. Last week, they told me they were going to recommend that the car be repossessed. I was able to obtain a new loan from a different lender (USAA) – now, I’m thinking that Navy Federal cannot repossess the car. However, I received a letter today from Navy Federal stating,

“The amount of $747.50 must be received by close of business on 13 May to prevent possible legal action. Such action could include obtaining a judgment, placing a lien on your personal properties, and/or garnishment of your wages.”

Is this a standard scare tactic?

Finally, we have a HELOC on a second home which we rent. I am 45 days past due on that ($44,500) with Bank of America. What is the likelihood they foreclose? The property is maybe worth $125,000 and we owe $80,000 on the first. When I spoke with the account representative, they suggested I call the Bank of America mortgage assistance line and try to work out something on the first before they would do anything with the HELOC.

Thank you in advance for your help,

Jake”

The Answer:

Hi Jake,

If you refinanced the car loan through USAA, they would have paid off the prior note held by Navy Federal. You should call to verify this fact. This would eliminate the concern of vehicle repossession by Navy Fed. Were it to occur due to some clerical error, it would be an illegal taking after the note had been paid. You would have recourse.

The more likely scenario is that Navy Fed is known to be aggressive in their collection efforts. The threat of legal action is not an empty one coming from them. At 40 days late it would be premature were they to place the account with legal, but they do have a reputation for attorney placement.

It is possible to get payment concessions on the first with BofA. You did not mention that you were behind on the first. Because you estimated the value on the home at about what you owe on the first and second combined you meet a profile that would suggest they foreclose. Foreclosures on underwater homes, while still pursued, are easier to navigate negotiations on a second. The suggestion from the HELOC rep you spoke to is not necessarily bad advice if you were behind in payments to the first. Are you?

Jake, what is your plan for settlement? What amount of funds can you accumulate over what period of time in order to succeed with your plan and goals? What state do you live in?

Reading books and internet posts are helpful in providing a foundation and ongoing detail. These sources may not have outlined realistic expectations sufficiently. That concerns me.

Citi Bank & Bank of America are straight forward enough. Navy Fed and the HELOC are nuanced and require finesse.

Ultimately your funding preparedness and timing will be the best arrows in your quiver.

Please answer the above questions by posting your answers in the comments below and I will be able to give a better outline of concerns.

Michael

Michael Bovee is an experienced debt expert who helps answer questions on the GetOutOfDebt.org site. He specializes in helping people with debt settlement through education and assistance. He can be reached at the Consumer Recovery Network.

Other Related Articles to Read

• I’m a Stressed Out Baby Momma and Need Help. – Mom
• Navy Federal Credit Union – DIY Credit Counseling Repayment Plan Terms
• Navy Federal Credit Union Won’t Stop Hounding Me. – Bryan
• Navy Federal Credit Union Told Me to Go Bankrupt. – John
• Everything is a Mess With Navy Federal Credit Union. – Lesley
• I Owe Navy Federal Credit Union $17,000. – Garr

Read the full article at GetOutOfDebt.org, click here: I Read a Debt Settlement Book by Mandy Akridge and Thing of Settling But Navy Federal is Coming After Me. – Jake

The following information is designed to assist you to put together a self-directed debt repayment plan with the creditor listed.

This information has been obtained from a number of sources and while believed accurate at the time it was posted, it may have changed.

However, it is good information to use to get an understanding of the types of things the creditor may do to assist you when working directly with them to create a repayment plan you can afford.

If you would like some personal advice and assistance from a credit counselor to put together your own repayment plan, visit the DIY credit counseling section of the forum and a counselor will help you there for free.

If you would like some free guidance on how to put together a self-directed debt repayment plan then download my free ebook, Eliminate Your Debt Like a Pro.

Below you will find terms that are specific to this creditor.

@GetOutOfDebtGuy

Definitions:

• Payment % of Balance: – The minimum payment the creditor is looking for. For example, if the formula is 3% of the balance then multiply your balance by the percentage. Let’s say your balance is $1,000. To calculate your minimum payment you would multiply 1000 x .03. The minimum payment would be $30.
• Minimum Payment Required: – This is the minimum payment the creditor is looking for. If your calculated minimum payment is less than this amount you will need to increase it to at least this amount.
• Interest Rate Reductions Available: – The creditor has been know or currently does reduce interest rates when consumers are on special repayment programs.
• May Bring Account Current After Some Payments: – If you are delinquent on your account the creditor does or has been known to bring accounts current when making special payments.
• May Stop Late and Overlimit Fees: – Some creditors may stop late and overlimit fees when special payment plans are agreed to.
• Requires a Full Budget to Grant Terms: – Creditor may require a complete budget before agreeing to special terms. A budget guide may be found my free ebook you can download, Eliminate Your Debt Like a Pro.
• Secret Phone Number to Reach Representative: This is the telephone number to reach a special payment representative.

More DIY Help is Available

There is so much free help and advice available on GetOutOfDebt.org that it can be overwhelming. But let me steer you to some important sections.

1. DIY Main Page – You can find the top of the DIY part of the site, here.
2. DIY Credit Counseling and Creditor Index – Want to find a specific creditor and their DIY credit counseling terms, click here.
3. DIY Debt Settlement – Want to see if settling your debt might make more sense for you in your situation. Visit the DIY debt settlement section of the forum and speak with an expert for free.
4. Ask Steve Your Question – Do you have a debt related question you’d like to ask me directly? You can do it right here.

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Other Related Articles to Read

• I Read a Debt Settlement Book by Mandy Akridge and Thing of Settling But Navy Federal is Coming After Me. – Jake
• Navy Federal Credit Union Won’t Stop Hounding Me. – Bryan
• I’m a Stressed Out Baby Momma and Need Help. – Mom
• Navy Federal Credit Union Told Me to Go Bankrupt. – John
• Everything is a Mess With Navy Federal Credit Union. – Lesley
• I Owe Navy Federal Credit Union $17,000. – Garr

Read the full article at GetOutOfDebt.org, click here: Navy Federal Credit Union – DIY Credit Counseling Repayment Plan Terms

“Dear Steve,

I am retired Navy and just had to leave my current job to go on disability. I have a credit card, personal loan and 2 car loans with Navy Federal Credit Union and I have already fallen behind on all but one of the car loans. NFCU has already started calling me. Today while I was on the phone with NFCU I had 2 other people from NFCU calling and leaving messages on my cell. As it stands I will probably have to file bankruptsy because I wont be getting enough on disability to cover my debt. I get enough from my military retirement and VA disability to pay my mortgage, keep my lights on and have food on my table, but thats it.

When should I get a lawyer and begin filing bankrupcy? Since I get enough from my retirement to keep my house payments up to date will my house be protected if I file?

Bryan”

The Answer:

Dear Bryan,

You should begin this process as early as today. If you want, you can click here to find a local bankruptcy attorney. You should find one now and go talk to them to develop an orderly battle plan on how to deal with this situation and how it might impact your assets.

The situation on the house will depend on where you live and how much equity you have but the lawyer will be able to answer all those questions for you.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Other Related Articles to Read

• I Read a Debt Settlement Book by Mandy Akridge and Thing of Settling But Navy Federal is Coming After Me. – Jake
• Navy Federal Credit Union – DIY Credit Counseling Repayment Plan Terms
• I’m a Stressed Out Baby Momma and Need Help. – Mom
• Navy Federal Credit Union Told Me to Go Bankrupt. – John
• Everything is a Mess With Navy Federal Credit Union. – Lesley
• I Owe Navy Federal Credit Union $17,000. – Garr

Read the full article at GetOutOfDebt.org, click here: Navy Federal Credit Union Won’t Stop Hounding Me. – Bryan

“Dear Steve,

My husband and I were doing very well with finances until about 2 years ago. We got deeper and deeper in debt, and now we are $35,000 in unsecured debt. I found out I was pregnant 7 months ago and started saving money until my sister came to me for help-to make the long story short I lent her our savings and haven’t received a dime back yet. I am due in March, I work for Fed. Gov’t so I don’t get paid maternity leave. We have about $4000 in bills each month, and we bring in $5000. Without my paycheck, we will be short and will end up being behind on bills.

What should I do?

Should I go to Navy Federal and try to apply for a consolidation loan and explain to them our situation? Our Credit card APR’s range from 9% to 27%.

I am stressing out and need help asap.

Mom”

The Answer:

Dear Mom,

Well I’m afraid the path was made fairly clear the moment your dear sister failed to give you the money back.

The problem here is that without any emergency fund to tied you over on maternity leave and then the increase in daycare expenses or the reduction in income once the child is born, I bet you just won’t be able to either make ends meet or catch up latter.

In a perfect world a debt consolidation loan might do the trick to consolidate your credit cards down to a better rate.

The first step will be to plan how much you could afford to pay each month on a consolidation plan for the cards after you factor in your post-baby financial reality.

If Navy Federal turns you down or you want to check for a better rate then look at the peer-to-peer lending network, LendingClub. If you end up going with LendingClub, I would be happy to be an investor in your loan.

So, give me an update in the comments section of your question on the site and let me know how much you think you’ll be able to afford after the baby is born. If the consolidation approach isn’t going to work for you, let me know and we’ll come up with a Plan B.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Other Related Articles to Read

• I Read a Debt Settlement Book by Mandy Akridge and Thing of Settling But Navy Federal is Coming After Me. – Jake
• Navy Federal Credit Union – DIY Credit Counseling Repayment Plan Terms
• Navy Federal Credit Union Won’t Stop Hounding Me. – Bryan
• Navy Federal Credit Union Told Me to Go Bankrupt. – John
• Everything is a Mess With Navy Federal Credit Union. – Lesley
• I Owe Navy Federal Credit Union $17,000. – Garr

Read the full article at GetOutOfDebt.org, click here: I’m a Stressed Out Baby Momma and Need Help. – Mom

“Dear Steve,

I owe $17,000 in credit cards. I am going through financial hardhsip. I owe 17K to NFCU for credit card. I have spoken to their collections dept. several times. We have been unable to come up with a payment plan that fits my situation. They want 250.00. Can only afford 50 per mo. at this time. This is not acceptable to them. Have explained that I am 2 mo. behind on first and second mortg. as well as other cards. Now, one employee from collections threatened lawsuit and 1099, another after belittling me and my profession told me to go file for bankruptcy, then another to left message on voice mail at work and home phone that was going to call my supervisor. Are these all scare tactics? Can they call my boss?

John”

The Answer:

Dear John,

No, they can’t call your boss and talk about your debt. But I do have to give them a prop for telling you the right thing to do, go look at bankruptcy.

A Chapter 13 bankruptcy will allow you to keep your house, will stop all the collectors in their tracks and may even reduce the amount of your second mortgage. Essentially it is a reasonable payment plan you can afford that gives you power and protection under the law.

Click here and find a local bankruptcy attorney you like. Call and make a free appointment and go talk to them. There is no need to commit to filing for bankruptcy on the spot. Just go and learn.

Once you file the NFCU collectors can’t call you anymore. If they do call before you file, thank them for giving you some good advice about looking into bankruptcy.

One more thing, in case you are curious why debt collectors mention bankruptcy, generally it comes from collectors from the original creditor that just want to get your case off their desk. If you go bankrupt it isn’t their problem anymore and doesn’t count against the collector. It’s a weird and twisted system but it is what it is.

Big Hug!

@GetOutOfDebtGuy

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Other Related Articles to Read

• Everything is a Mess With Navy Federal Credit Union. – Lesley
• I Read a Debt Settlement Book by Mandy Akridge and Thing of Settling But Navy Federal is Coming After Me. – Jake
• Navy Federal Credit Union – DIY Credit Counseling Repayment Plan Terms
• Navy Federal Credit Union Won’t Stop Hounding Me. – Bryan
• I’m a Stressed Out Baby Momma and Need Help. – Mom
• I Owe Navy Federal Credit Union $17,000. – Garr

Read the full article at GetOutOfDebt.org, click here: Navy Federal Credit Union Told Me to Go Bankrupt. – John

“Dear Steve,

Everything is a mess. Another navy federal question. I owe over 18 thousand to NFCU and around 7 thousand to other credit cards, My husband owes around 20 thousand to credit cards 6 of that is to NFCU. My husband has ended up in a nursing home. He has only retirement income. We have a medicaid trust set up and they take half of his income for the nursing home per medicaid rules. I have a limited community spouse amount which is the other half of his retirement income and barely enough to meet my monthly obligations. NFCU has been after me. I agreed to try and pay 120 a month for 12 months and they were suppose to take the interest down to 0-3% which now they say will be 6% well 6 percent on over 18 thousand is like interest only payment.

I told them I need help to pay the principal down and please use the 120 a month to do that instead of all interest. I have already paid over 1,600 in interest this year alone before we fell on hard times. They said unless I can pay 180 a month which I cannot do right now they will not move the interest down. I said I will not pay the 120 a month then.

My husband will not be coming out of the nursing home he is there permanently. Navy says they will take legal action. I want to pay them something and things might be better financially in a year but they won’t work with me except for the terms they insist on.

We had excellent credit before and paying all our bills on time. My only other option is bankruptcy for me which I did not want to do to nfcu as we have been with them over 25 years. We own a modest home. Have one 2004 car and no other assets to speak of.

How can I get Navy to work with me on this debt of mine? I do not want a lien on our home. I am afraid of loosing my car although it is paid for. Help. then I need to decide how to handle my other credit cards or just claim bankruptcy.

Thanks,

Lesley”

The Answer:

Dear Lesley,

This is a situation where long term debt was created but life just didn’t cooperate with you. It is unfortunate that your husband is now limited to the nursing home and I’m sure there have been some dramatic income changes along the path to that point.

Unfortunately there is nothing you can do to force NFCU to work with you. Well, except for one thing, bankruptcy.

As much as you want to avoid it, bankruptcy is a legal process that provides some protection and rights for the debtor. And I know you feel an allegiance to NFCU, after being with them for 25 years but shouldn’t that be a two way street? It does not sound like they are providing much value in the past relationship with you. That is not a justification, just an observation.

I think at this point, be it $120 a month or $180 a month, there is not much of an expectation that you are going to be able to afford or service the debts of both you and your husband in your situation. Any monthly payments you send now will be essentially worthless if you can’t ultimately pay off all the debt.

Your homework is to find a local bankruptcy attorney you like, make an appointment and go in and talk to them about what bankruptcy and its associated legal protections would mean for you.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

@GetOutOfDebtGuy

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Other Related Articles to Read

• Navy Federal Credit Union Told Me to Go Bankrupt. – John
• Vanguard Settles With $2 Million In False Claims Act
• I Read a Debt Settlement Book by Mandy Akridge and Thing of Settling But Navy Federal is Coming After Me. – Jake
• Navy Federal Credit Union – DIY Credit Counseling Repayment Plan Terms
• Navy Federal Credit Union Won’t Stop Hounding Me. – Bryan
• My Mother Was Recently Diagnosed With Dementia and She Owes Discover. – Kim
• I’m a Stressed Out Baby Momma and Need Help. – Mom
• My Mother is Disabled and Bedridden in a Nursing Home and Chased by Debt Collectors. – Carolyn
• I Owe Navy Federal Credit Union $17,000. – Garr

Read the full article at GetOutOfDebt.org, click here: Everything is a Mess With Navy Federal Credit Union. – Lesley

Garr

“Dear Steve,

I owe Navy Federal Credit Union $17,000 the account is charge off but they are take legal act to garnishment or civil suit i am not sure they take a settlement.

Garr”

The Answer:

Dear Garr,

The issue here that you need to take some action to intervene here instead of just watching the bus hit you. If the debt has already passed from current, to delinquent, to a lawsuit, and now a garnishment; no acceptable action has been taken by you yet.

Navy Federal Credit Union, like most other credit unions, is willing to talk about a solution to help remedy the situation. They might ask for a payment plan that is more than you can afford. In that case, you could always create a payment plan under a Chapter 13 bankruptcy or discharge the debt in a Chapter 7 bankruptcy. If you went bankrupt it would terminate the judgment and prevent them from garnishing your wages.

To learn more about your options in bankruptcy you should click here to get a free bankruptcy consultation or find a local bankruptcy attorney to meet with.

Garr, the responsible thing to do here is for you to take some action and not let this just roll over you as a wage garnishment.

Big Hug!

@GetOutOfDebtGuy

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Read the full article at GetOutOfDebt.org, click here: I Owe Navy Federal Credit Union $17,000. – Garr