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Just got served papers this a.m. - need help/advise ASAP please!!

Discussion in 'Debt Settlement' started by dog breath, Mar 18, 2012.

  1. dog breath

    dog breath LoanSafe Member

    Citibank letter...debt will be sent to attorney for collections if no arrangement in next 30 days

    I'm new to this site, so THANKS in advance for any help on how to handle this situation. OK...here's the deal. We (my wife & I) have gone from 2 incomes to 1. We have ALWAYS paid our bills on time, never once missing or making a late pymt in 12 yrs of marriage. Initially, we used our immediate savings to offset the monthly expenses, then that ran out, so we had to dip into our retirement. We decided last year to quit using our retirement to pay the bills, so with the 1 income, we pay the necessities & have let the CCs go unpaid. Its been approx 5-6 months now with no pymts, but stayed current on 1st & 2nd mortgage. Now, we're looking into Short Sale to get out of that situation, but need to deal with the CCs, which we HAVE NOT used at all for any purchases since we stopped making pymts. And with no job on the horizon, we'll still at 1 income.
    We have been receiving daily phone calls (which we let go to vm, never taking a call yet) & have now received our 1st letter from Citibank which reads:

    "Unfortunately, we have been unable to establish an acceptable arrangement for repayment of the above referenced AT&T Universal Card account. Unless such arrangement is established within 30 calendar days from the date of this letter, we will refer your account to an attorney licensed in your state for further collection efforts including a possible lawsuit to obtain a judgement.
    If you wish to avoid the consequences of your account being referred to an attorney for collection, contact us immediately at the toll-free number shown below to arrange for pymt."

    Our questions is this....will Citibank send our debt straight to a CA for them to "collect or settle" or to an attorney like they state above? Or, are CA & attorney one in the same in this context?

    Look forward to your input...thanks again!!
  2. troubleinriverside

    troubleinriverside LoanSafe Member

    Hmmm......sounds like Bankruptcy is in your future. Speaking from experience, yes, Citi will eventually send it on to an attorney. Then the attorney will sue, and get a judgement. Your only way out is bankruptcy, or settlement with Citi to pay less then the balance owed. Best of luck on your journey ahead
  3. dog breath

    dog breath LoanSafe Member

    Thanks for the comment Troubleinriverside....Bk is what I've wanted to avoid all along.

    But, I can't help to believe there's another way....I've been reading so many stories on here that actually sound far worse than mine that people are able to get out of. I just need a little more time & then I can come up w/a 20% settlement that I could offer Citibank. At least it will be 1 CC down, but 4 more CCs to go. Ugh!!! Will keep positive though...don't want the CC companies to have that much power over my well being. Finish strong is my motto!
  4. troubleinriverside

    troubleinriverside LoanSafe Member

    well sooner and not later they will come for you. my experience, and I had 7 cards, is that you have about 1 year from your last payment, and then one of their local attorneys will file a law suit. Citi is very agressive on delinquent Credit Card debt. Best of luck
  5. dog breath

    dog breath LoanSafe Member

    Thanks again for sharing your personal dealings w/Citi...the additional details help me to understand the big picture w/them. I'm at 6 months w/no pymt. My plan is to call them before the 30 days is up (from date of letter) & hope we can agree to a 20% settlement. I owe approx $18k & could manage to come up w/the $$ from tax returns. Do you think I can buy myself a few more months (to come up w/the $$ if I don't get enough back from tax returns) if I "play the back-n-forth game" of a settlement offer?? Just need more input since you've had experience dealing w/Citi. Meanwhile, I haven't received any offer from them, just the letter. So do you think this is just the beginning of their efforts to get me to pay? Little do they know I don't have the $$ to pay in full, nor do I have more than 20%. Hoping the strategy of offering a settlement will work...if not, I don't know what to do???

    If anyone else has experience w/Citibank, please chime in. I want to make the best decision without jeopardizing my chances of getting sued...really don't want to go down that road. I will borrow from a relative as an absolute last result to not get sued.

    Great forum! Thank you!!!
  6. IOAlot

    IOAlot LoanSafe Member

    I havnt hear of Citi going that low, the most common settlements I have read about are 40-50%, myself included. Citi will give you 4 payments over 90 days.

    If they send it to a collection agency as troubleinriverside said, you may get better than 40%.
    Good Luck
  7. Speed Shady

    Speed Shady LoanSafe Member

    I settled with Citi for 45% at 170 days late. This was a couple days ago. I told them I had a BK lawyer on retainer but was hoping to settle. I called different agents.. Every trick I could think of and still they would not budge under 45%. This was for two accounts for $12k and $9k.
  8. BigBlok502

    BigBlok502 LoanSafe Member

    Been down that road already, 9 credit cards totaling $95k, stopped making payments 12/2009. They will only sue you if they think you have assets, it is not a gaurantee they will sue. Here are some bullet points to ponder:

    - Two Chase CC, one $4.5k and the other $6.5k. The 4.5k sued me when I was 90 days late (25 year customer missing no payments ever), the other did not. Came to terms in court house (not before the Judge) with reduced fixed interest rate for 48 months. Still owe the 6.5k which has been sold at least once.

    - As the 180 days missed payment mark arrived I started receiving settlement offers from ALL of the CC companies - Chase, Citi, BOA, Cap One and they varied from 15 percent to 40 percent. I still have all of the settlement offer letters. Hindsight being 20 20, I would never, repeat NEVER tap into my retirement account to make CC payments. In reality I did and have no retirement account anymore. Had I not tapped into it I would have money to settle.

    - The letter you got is a scare tactic. See my comments above.

    - Two years ago I interviewed three BK attorneys, well worth the time and education. I paid one of them a small retainer fee, as of today have not filed BK. I do however tell all CA's my attorney's contact info and I no longer get those nasty calls from CA's. Every few months, especially if the loan has been sold, a new CA will call wanting to collect. I let them go thru their speech and then ask them if they would like my BK attorney's contact info - I just love the deafening silence! Wished I had done this prior to Chase sueing me.

    - Fast forward to today, I have modified my first mortgage and in the process of my 2nd. Once the 2nd is taken care of I will systematically attempt settlements on the CC's.
  9. troubleinriverside

    troubleinriverside LoanSafe Member

    with me, I planned my BK-7 for over a year. I knew I was goin down. I played them all right to the end. when I finally received the letters from the attorneys, I knew it was time to pull the trigger, so i did. they will sue, get a judgement, and garnish your pay.Don't misjudge them and be sorry.

    what you really need to think about is your big picture. without additional income, your in deep soup. Bk ****s,yes, but you can rebuild. it's all about admitting to yourself how much trouble your in. my revelation was when I spoke to my first attorney. then I went home, planned my strategy and waited, and I had not even stopped paying anyone yet. Right now your stuck in neutral going nowhere. I discharged almost $250K in CC debt. I am 1 year, 10 months past my discharge, I have credit cards again (no balance) and have had 2 auto loans with reasonable interest rates.
  10. dog breath

    dog breath LoanSafe Member

    Thanks for you input IOAlot! The comments really helps me understand how all this stuff works. Its overwhelming at first, but when you realize "it is what it is", then you just start dealing with it head on.
    I will continue to post updates throughout my journey with hopes my experience(s) will help someone as well. This is a terrific site and one I'm very grateful to have found...I don't feel so helpless & alone anymore!
  11. IOAlot

    IOAlot LoanSafe Member

    "it is what it is"

    Thats my favorite line to every time I speak to someone looking for money. After a year Im almost done, settled 90k in credit card debt for 35%. Its really not difficult, just an extremely scary situation, but when you get on the phone, never let them see you sweat, it is what it is.
  12. dog breath

    dog breath LoanSafe Member

    WOW!! So you're still in your home, haven't been sued, & received a very worth while education on how BK works...good for you BigBlok502! Seriously, that's awesome to hear you're still making it and they haven't beat you down. If you've been dealing with the CC companies & CAs for over 2 yrs, without getting sued, you're obviously doing something right.
    One of my biggest concerns is how do they know whether or not you have assets to determine whether or not they will try and sue you?? I don't want to risk making a hasty decision....my main goal here is to buy more time to come up with the $$ to settle. I will not use another penny of my retirement to pay the CCs and refuse to let them know we actually have some retirement left. If that means I will have to wait for them to send it to a CA, then I will. But, I don't want to screw up either if I don't respond to their letter before the 30 days expires. The threat of our debt going to an attorney is the part that gets me...I'd rather deal w/a CA. I know you said the letter is a scare tactic, so are you suggesting to just ignore it for now? I'm trying to make the best decision so I don't get sued.
    Btw, do you mind posting a few bullet points on the top 3-4 pieces of info that empowered you to not file for BK? You said you interviewed 3 BK attorneys, but never used 1 of them to file. I'm curious how you took your daunting situation (similar to the one I'm in) and have gotten through it for over 2 yrs w/out BK. Amazing & congrats!!
    THANK YOU for your input & detailed explanation above. This forum has made such a difference to me & my wife in a time of need. It has already empowered us as we've read about the countless stories & personal experiences others have had and how so many have gotten through it without letting their dire situation take them down. NEVER NEVER in a million years did I ever think we would be in this situation...but sh*t/life happens! We're choosing to still believe & know that we are good people who've done the right thing (paying bills on time, never a day late in 20 yrs) but have just fallen on hard times. Our pride has gone out the window & we've been humbled to another level, BUT we won't let the bullies win. We will FINISH STRONG!!!!!
  13. dog breath

    dog breath LoanSafe Member

    CONGRATS on your huge accomplishment of settling that much debt in just a year's time. Wow - so it CAN be done! I'll remind myself of that when they try using the scare tactics. I refuse to be a victim of their manipulative ways!
  14. dog breath

    dog breath LoanSafe Member

    Curious Speed Shady....why didn't you let it go to a CA to try & settle for less than 45%? Were you also threatened w/a letter about sending your debt to an attorney? Luckily you had enough $$ to settle that high. Unfortunately, I don't. Hoping Citi is just using a scare tactic & maybe it'll go to a CA instead of an attorney. Then my hope is I can settle for less...will keep everyone posted on what happens.
    Btw, did you really have a BK attorney on retainer, or was this your way of using a scare tactic on them? I've thought about doing the same thing, but didn't want it to backfire on me if they getted p*ssed off w/a BK threat.
    Thanks for your input!
  15. IOAlot

    IOAlot LoanSafe Member

    dogbreath

    I reread your first post. I assume you are underwater on your home since youre looking at a short sale. In that case, unless you have other attachable assets, you may not be a candidate of a lawsuit. However, if they do sue, the 1 income is at risk of garnishment if the debt is in that name. You may want to look at BK.



    In my situation, I dont think anyone ever really looked into my assets, cause if they did they would have sued and gotten a lien on my home which has a good chunk of equity. I settled all of our account before charge off, except Capital One. We only had 1 account, a 37K Amex card that finally went to a local attorney for suit. Settled with him in the first week of speaking to him for 37% of the balance.

    As you said, we as well never thought we would be in this position. It takes a lot to wrap your head around defaulting but Ill wear my crappy FICO score proudly on my sleeve in exchange for a good nights rest.
  16. RyanJP

    RyanJP LoanSafe Member

    The biggest mistake most people make when attempting to communicate with a CA is to fall for the line of "Let's get your income information so we can figure out how much of a payment you could afford." Or the claim they need your SS number for their records to make sure their files are correct.

    That's how they get a lot of the information and a lot of the decision on whether (or at least how soon) to sue you comes from this information.

    If you do talk to them, politely refuse to provide any financial information. Just tell them that you can come up with X amount for a lump sum settlement. Tell them you would be borrowing it from a family member or friend so that they don't get the idea that you have a mountain of cash sitting there for them to plunder.

    Make sure you insist on recieving whatever offer they agree to in writing.

    While I don't often advocate being untruthful, I have absolutely no respect for CA's. I tried to deal in good faith with one and learned the hard way that they do not deal in good faith with you.
  17. BigBlok502

    BigBlok502 LoanSafe Member

    All three said that if we wanted to keep our home to get a mortgage modification first before filing BK, I just didn't know at the time getting a modification would take so long. We chose which attorney we wanted to represent us and paid them a retainer, so they have been fielding the phone calls from CA's.

    In the meantime while trying to modify our mortgage (which is now modified), our situation has changed. I now own my car outright and my wife's is almost paid off, now we have assets. With assets and a BK, the trustee can and will seize the assets to be sold and the proceeds go to the CA's. Or we can "buy back" our assets, right - I want to pay for my cars twice. Asset exemptions vary from State to State, in Florida it is a whopping (sarcasm) $1000 for a car.

    CA's determine your assets as RyanJP ​mentioned above, by you telling them OR if they happen to spy on you which is unlikely. If they pursue and get a Judgement against you the court will order you to list your assets, not a good thing.
  18. Speed Shady

    Speed Shady LoanSafe Member

    Yes, I got that same letter on one of my accounts. The reason I did not wait for a CA and a better deal is that I also have not paid my mortgage since 9-1 (reason I had the $$). If I did not settle, it could still go on for months. I wanted this settled and done before I hit the rental market. Landlords seem to be forgiving on foreclosures, CC defaults I'm not sure.
  19. fightforit

    fightforit LoanSafe Member

    BigBlok-
    were you aware of the whistleblower and Chase credit cards?
    Hey, remember when JPMorgan Chase abruptly suspended all their debt collection court cases a couple months ago? Now we’re learning more about the problems in their debt collection arena. And surprise, we have more robo-signing!
  20. Matman

    Matman LoanSafe Member

    Dog thread you seemed worried like I was and I hope after I share my story you will have some comfort. 6 months ago my credit was 830" I hit some real sh!t luck and now it is 490. During that time I accrrued

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