Debt and Insolvency Advice

Debt Advice Repossession
My car is now being saught for repossession…Can I stop this?

Im 20, stupid and definatley learning this lesson the hard way. I am about 3 months late on my car payment, and in fear of the creditors, I have been avoiding their calls. I talked to them today and i found out that my car is up for repo. I just got a job and get paid in 2 weeks. She made it seem like, at this point, there is nothing that can be done, but pay the amount due in full today! however, I moved out of state(not to hide the car) just to live with my family, until i am back on my feet and because of my new job i found. What will happen? will they find me fast? because maybe if it takes less than 2 weeks, I can just pay my debt?? oh man, i hope someone has some words of wisdome. please dont be cruel, i am well aware that this is my fault and that there are several things i could have done to avoid this…just looking for some advice going forth. thank you

First, relax… All is okay.
Yes, the bank wants their money or their car. I would call them and explain what happened and that you want to make good on the deal. If you can get through to someone who is willing to work with you – at the bank or financier who lent you the money – you may have some success. If you send them a copy of the job offer or some other proof that you now have a job, and start making payments as soon as possible, you should be okay. You need to work with them and be patient though. If you get mad, hang up, swear, or otherwise come across aggressive, they are in the drivers seat. Be humble, suck it up – you screwed up. Now, be an honorable person, talk to them, explain the situation, and make good on your contract, penalties and all. They may waive some of the penalties if you ask, but don’t ask until you are talking to someone who is working with you and willing to try to stop the repossession. Maybe even wait until you’ve got an agreement and are showing your willingness to make good and pay up.
Be proactive, call them to clean this up. Then, clean up the rest of your bills. Get a copy of your credit report – you can for free, and not from one of those services that make you sign-up for a service. Go to http://www.ftc.gov/freereports and get a report from one of the 3 agencies every 4 months – This will get you your free report from all 3 agencies once a year. Clean up anything that is negative by working with the company that you owe money to. Start putting a few dollars away every paycheck for a rainy day too – I just got laid off, but I’m okay – I have money set aside. Do the same. Start saving now for retirement too… It is NEVER too early. Let me know if you want more info…

Reaffirm car loan after bankruptcy?
Agreeing to pay a loan after it’s cleared by bankruptcy is only beneficial in a few instances.

In an economy which relies mostly on a credit system, you cannot help but depend on that tiny plastic card when paying for your purchases. If you’re not careful, however, you might find yourself having more debt than your finances can actually handle. What if you find yourself in such a situation? This is when you can go for the option to have your debt written off.

Since our focus here is to determine whether having your debt written off is a good financial decision or not, let us first take a quick look at the process. When your credit card company writes off the debt that you have on your credit account, what they do is report the uncollected amount due as lost income. They usually do this if you fail to make payments for six succeeding months, upon which the account will be turned over to a collections agency.

When this happens, how does this impact you as a creditor? The biggest disadvantage to making this financial decision is that your credit score will be affected negatively. Aside from lowered credit scores, you might be losing some or most of your credit card privileges, and you might get harassed by collections agencies.

Now, consider what will happen once you have your debt written off. In the United States, the process is referred to as debt settlement. In the United Kingdom, the thing that will help you is called an IVA or an Individual Voluntary Agreement.

Just like the debt settlement agreement in the US, UK residents can opt to sign an IVA which is a legally binding debt solution. It helps those who have serious unsecured debts to prevent bankruptcy or property repossession – without having to actually declare bankruptcy.

Perhaps the only disadvantage to having your debt written off is that it is a form of insolvency. As such, it would have a serious effect on your credit rating which typically lasts for about six years from the time that it starts.

Before deciding to have your debt written off, there are several alternatives that you can look into. Here are some of them.

Do not immediately stop making regular payments for your debts – only use it as a last resort after considering all your other options.

Make a general assessment of your financial situation first. If you feel that you can still get by through reduced monthly payments, settle the issue with your credit card company. This way, your credit score will not be affected and you might be allowed to repay some or all of your debt.

Obtain a copy of your credit report. If you have maintained good credit over the years, your credit card company might allow you to negotiate for a lower monthly payment.

At the end of the day, making a decision like having your debt written off and suffering the consequences of it affecting your credit is all about laying out all your options on the table. As long as you are aware of the consequences of writing off your debt, you can slowly but surely be on the way to financial recovery. The best way forward is to seek free advice from a professional company, to find out whether writing off debt is appropriate for you. Approach only reputable companies and make sure you apply to a few of them before deciding.

Find out more about getting debt written off on the author’s Debt UK website. K D Garrow has worked as a senior manager with significant financial responsibility for the last twenty years. His website offers free, unbiased advice on a range of debt related issues, including Debt Management, debt settlement, IVAs, bankruptcy, loans and budgeting.