Help! What Now???

[kaciespade]

I dont know if this is the group to ask this question, but I'll try
anyway:

I am 19, almost 20 years old, and my credit rating is very poor. When I
was 18 and a half years old, I took out a car loan at a VERY high
interest rate due to the fact that I was a first time buyer with no
credit and I had to have my father co-sign for me. They also required a
down payment, so we put $1,000 down. Leaving me with a $6,000 debt to
pay bi-weekly. Over the course of 6 months into the loan, the car
constantly broke down. It seemed like I put extra money into the car
every other month. When it came down to it, the car lot was not honest
with their warrenty policy. 6 months into the loan the car totally
broke down! They told me to bring it in and $50 was the maximum I'd pay
due to my warrenty. After a week with no vehicle had gone by, the car
lot wanted $300 to fix it!! What happened to the $50 max? Not covered!
After months of stress and financial problems I voluntarily gave the
car back in October 2004. Leaving me with months of a $3,900 charge
off. Since then, my father has passed away, so I don't know if that
will affect anything. Also my credit score is 544 with Transperian.
Very poor. I know I made a bad decision and I take full responsibility
for my choice, but I am still stressed out a year and a half later. I
feel horrible knowing I have this debt. I'm ashamed because I can't
even get a department store credit card! I want to take care of this,
it's the only debt I owe, and I want it off my credit report. Is there
a way to do this? What steps should I take to clean up this mess?

 

[OutlawofSherwood]

(e-mail address removed) wrote:

<snipped but read>

Also my credit score is 544 with Transperian.

Very poor. I know I made a bad decision and I take full responsibility
for my choice, but I am still stressed out a year and a half later. I
feel horrible knowing I have this debt. I'm ashamed because I can't
even get a department store credit card! I want to take care of this,
it's the only debt I owe, and I want it off my credit report. Is there
a way to do this? What steps should I take to clean up this mess?

For a debt balance of only $3600, I would strongly encourage you to
speak with the creditor (or the third party collector to which they
sold/assigned your account) and make a repayment plan.

Talking to collectors can be nasty business. Remember that bad things
happened to you, you never intended to take out the loan and then not
pay it back--be firm but polite, and if a collector is rude or
threatening, demand to be transferred to their supervisor.

Keep demanding, and if they won't transfer you hang up. Then call back
and speak with an operator, explaining you are trying to set up a
payment arrangment and [their name here] won't help you.

I guarantee this will get you through to someone who will help.

Another alternative is working with a credit counseling company -
choose any one from the phone book, they can frequently lower your
interest rates and set up a plan that works in your budget and have you
debt free within 1-3 years.

Bankruptcy is an option only when you've tried everything else. I have
a borderline chapter 7 case with $17,000 racked up during a bipolar
manic episode two years ago. (My meeting of creditors scheduled for
9-27, wish me luck!). I know the bankruptcy will stay on my credit
history for ten years, and may keep me from securing employment or
reasonable interest rates. I'll also have to pay cash for everything
for at least the next few years.

Fortunately I've already been paying cash and will never take out
another credit card.

I'm trying to illustrate what a serious step this is--and if you file a
petition for bankruptcy, and the trustee declines to discharge your
debt, you are left with 100% of the debt to pay off *and* a bankruptcy.
Just because your debts aren't discharged doesn't mean that bankruptcy
goes away.

Good luck, whatever you decide--
Jamie