I had about $47K in credit card debt and then lost my job and was sick and in a hospital. I was planning on filing bk, but due to the knew bk laws, I was unable to file bankruptcy. I was out of a job for about a year, and used any income I made to live on while I searched for a new job (which was difficult due to my bad credit).
I finally have a job and have saved some money, but I don’t feel real stable in the job due to the economy and need to try and preserve enough cash as possible in case I lose it and am unable to find another job (due to a resume with gaps and bad credit). My biggest debt was with Amex for about $27K and they have sent me several offers to give me an Optima card if I pay in full and a law firm offered a settlement for about $16K (but in this settlement they mentioned that it would be better to pay the full $27K as that will stop future collection efforts for the remaining balance….this left me a bit confused as to whether this was an actual settlement).
If I pay Amex it would wipe me out, and I still have about $20K in debt from other creditors who may come after me.
I occasionally get offers from some of the other creditors/collectors for settlements…can I just pay off of these and keep their letters as support that the debt was paid in full?
If I get eventually taken to court and get a judgement against me does it really make my credit even worse, even though I already have multiple charge offs? If I cleaned out my bank account and kept my cash (to live on) in my mattress does a judgement really hurt me? If I continue to not pay after a judgement was made, what happens? Since I live in Texas they cannot garnish my wages.
Do I try and wait out the statute of limitations? Or does this make me getting sued more probable?
Ultimately, I would love to get a stable job, and pay all these debts off, but I don’t want to wipe out all my cash trying to pay off half of them and end up homeless either.
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Thanks for any help.
So much of your situation is based on the law of Texas where you live. I would urge you to find a lawyer, make an appointment with a lawyer licensed in Texas and go in to speak to them and get specific answers to your legal questions.
Regarding the debt settlement statement made by the collection agency, I think what they were trying to say is that it is getting to be a problem with creditors agreeing to settle a debt and then coming back years latter and claiming they didn’t and instead only got a partial payment.
This can be remedied by getting a letter from the original creditor stating the settlement deal and keeping a copy of the letter and proof of payment with your other important papers so when this issue surfaces in the future, you will have the documentation to resolve it.
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