Debt Negotiation...PLEASE HELP

iVillage Member
Registered: 09-24-2008
Debt Negotiation...PLEASE HELP
5
Wed, 09-24-2008 - 5:20pm
Hi. I'm a full time college student, and have not a huge source of income. I'm only 20 years old and I've accrued 12,800 dollars in debt. I've amassed this debt in under 3 years, which is the scariest part for me. Any money I do make goes right back into the cards, and I start graduate school next year so I really am nervous about falling under. I've never made a late payment, and while I've occasionally gone over my limit, I have a pretty good standing with my creditors. I've recently gotten enrolled in a debt negotiation plan (with credit solutions of America). I have until Friday to cancel my enrollment, and I am really leaning towards doing that. While the salesperson was extremely nice and helpful, I feel like that's why he's a good salesperson. I've read some really horrible reviews about settlements not being reached, and people being forced into arbitration...and since no one knows about this debt, I could not handle something like this. He continually assures me that the likelihood of my debt being settled is high, and that there's even complaints on the BBB so I shouldn't worry about that. I am still highly suspicious, and even though this seems like a really great way out, I am really nervous. Does anyone have prior experience with this? I want to be out of debt as fast as I can because I am completely overwhelmed and stressed.
iVillage Member
Registered: 07-02-2008
Wed, 09-24-2008 - 5:31pm

I do not have experience with debt management so hopefully someone will post and give you some advice in that area. I just wanted to say welcome and that you are not alone.


Also, you didn't get into debt overnight and you will NOT get out of debt overnight. You might want to (don't we all) but its not gonna happen. Debt does lead to some sleepless nights and exhausting decisions but it takes hard work and determination to start paying it off and making changes in the way we see and value money. Best of luck in your journey.

iVillage Member
Registered: 11-17-2007
Wed, 09-24-2008 - 6:28pm

I wish you had seen Suze Orman's show Saturday night. She talked about these settlement places and she was totally against them. First they charge you a big fee up front. 750.00 to 1000.00

iVillage Member
Registered: 07-11-2004
Thu, 09-25-2008 - 2:02am

Hi! Have you tried settling directly with the creditors involved? I was in a similar situation a few years back because of some medical issues. I called the 2 creditors directly and explained my situation to them. One of them really worked with me and the other was more difficult. If your credit rating is still OK maybe they will lower your interest rate or something. One of my creditors actually lowered my payments. I know that the economy isn't doing well but it still doesn't hurt to try and deal with them. Another thing you could do is pick up some nanny or babysitting hours if your schedule allows. I worked part time a s a nanny when times were tough and the extra $$ I made really helped with the bills. You could also apply to do some seasonal PT work at one of the stores in a mall since the holidays are coming and they all need extra help for that. Good luck and keep us posted! :)

iVillage Member
Registered: 10-10-2007
Thu, 09-25-2008 - 11:35am

I would just call the credit card companies directly. I know it can be scary, but I did this when I was a student, and they were really helpful. They might offer a payment plan. What they did for me is, they closed out the account (but they said it would be better on my credit report if I closed the account like this, than if they charged it off because it didn't get paid). I then started making monthly payments to them. Because the account was closed, they had lowered the interest rate and also I got no other fees, so the balance did go down a lot.


Basically, the companies are getting a lot of bad PR right now for preying on college students with high-interest cards and getting them in trouble before they even start out in life. In fact, if you look at the paper, a lot of colleges aren't even letting credit card companies on campus anymore, or even allowing mailings to the students. So, they are probably going to be even more willing to work with you.


As far as grad school goes, if you're concerned about the debt, is there a way to put it off for a year, and maybe live at home and work and pay off the cards? That might be a good option. And sometimes schools will let you defer your enrollment. Just a thought.

iVillage Member
Registered: 03-17-2003
Thu, 09-25-2008 - 12:09pm
You have good reason to be nervous.