[Creditproblem]

Hello,

I recently joined the above company to try and get my credit card debt under control. I owe abot 25K in credit card debt and can barely make the minimum payments. I have been a member since June and part of the program is to stop making payments and use these delinquent payments as leverage to reach a settlement. How likely is it that they will sue me and how long does a CC company usually wait to do that?

Any help would be greatly appreciated.

[Fr_Chuck]

I would say that not paying to try and reach a better settlement is first destroying your credit even worst, and at that large of debt, esp if you have a job, you can consider they will sue if they think they can garnish your wages, instead of taking a lower settlement.
And normally the lower settlements only work if you can pay the balance in full, not payments.

I would say that I have issues with this sort of company and arrangement

[Creditproblem]

Thanks for the response. I agree that it will and has ruined my credit but I was already missing payments or just barely paying the minimum. Do you know how long it takes before an attempt to garnish my wages typically takes?

I am currently making payments to the consolidation company but just not the amount I would have been paying to the CC company. After making the payment the money is then held in account in my name. When I have enough in my account, the consolidation company will then use this money to negotiate a settlement.

[DrJ]

First of all, good settlement companies work. Most likely, the payments you are making are not being given to your creditors. They are being saved in an account until they reach enough to pay off a settlement in full.

Your credit may be taking a slight hit, but if you were already falling behind, the damage was most likely already done. And once you have completed the program, your credit will likley be better off than it was before. (I have numerous case studies to show how just completing a settlement program has raised clients scores anywhere from 20 to 120 points).

As for getting sued, its hard to say. Who are your creditors & how much is owed to each? What state do you live in? Are you an employee or self-employed? Are you a home owner? How long of a program did you sign up for?

[Creditproblem]

Thanks again for your honesty.

I think my credit has been reduced by 100 pts since defaulting in June...

You are 100% correct on the payments, they are going into a special purpose account in my name at a bank until I have enough money in them.
I owe 20K to Citi and 5K to Chase
I am an employee in Mass. And rent.

The program is for 36 months but hopefully only 24.

[DrJ]

Ouch... that wasn't what I was hoping to hear.

This is a problem with MANY of the settlement companies out there: Unrealistic programs.

I would advise to find a way... SOME way... ANY way... to fund that account FAST.

You don't want to **** around with CitiBank. Or MBNA or Dsicover for that matter. These creditors will still settle but they are going to demand a higher settlement and they just aren't going to wait that long for their money.

You have 80% of your debt with Citi. A 24-month program (let alone a 36-MONTH program) is not going to work. The companies I work with would not even take you on as a client for anything more than a 12 month program.

I would advise you start looking hard for about $12K to put in that account ASAP.

Shame on Superior Debt Services for even signing you up in that long of a program. You see, that non-refundable retainer you are paying right now... if you have to drop out of the program, you don't get that back. Most of these companies just don't care.

Do they have any guarantees? Not that it will help keep you from getting sued but how much of your money will you get back if they settle for 100% to keep you out of a judgment - called a stip (stipulated payment).

[Creditproblem]

Not sure about any guarantees. Do you think Citi would be willing to wait if I had my rep from SDS give them a ring to let them know we are working on getting them some money?

[DrJ]

No, not likely. They are very aware of settlement companies and would most likely attempt to drive a wedge between you and SDS. With Citi, companies will usually wait to talk/deal with the collection agencies because Citi is rather unreasonable.

There really isn't a way around them. You just have to play by their rules. Do what you can to fund your account as quicly as possible.

(Im not saying you will get sued... sometimes people make it through that long without getting sued, but the statistics are against you)

[Creditproblem]

Thanks for the info.

Just so I understand this correctly. Citi has a collection agency obatain there money after a certain time frame? How long does it take before an account goes into collection?

[DrJ]

Most all creditors do. Usually, this will not happen until about 6 months from the last paymen when they discharge the account. However, I have seen Citi move an account into collections as soon as 3 months.

[Creditproblem]

How do you know when an account has moved into collections?

[DrJ]

Usually just from getting a call from the collection agency. You could call the original creditor to find out... but without the ability to pay, that may not be the best idea right now

[amwod]

We have been with them for a year now and have settled two debts. However, it turns out we actually are going to end up owing just as much because the claim the settle on the amount you owe when you join, but the cards keep adding interest and fees and what was once a $6000 dollar credit card becomes a $10000 credit card. Plus, I have had two summons from different law offices since this started. It has been an experience. Most recently the held on to some tax forms from a settlement and we have already filed our taxes. ( they tell you to have your address changed to theirs) These forms were dated January 1st and they mailed them to us at the beginning of March! We now owe the IRS about $1000!

[sfmom3]

I agree with the previous post. I am with Superior Debt Services, and it is 1 step forward, 2 steps back. They take away $357 a month for their "retainer fee" from the $636 they already deduct a month---and they have settled only 4 accounts in the PAST 2 YEARS! I also was served a summons by 2 creditors, and they say, "That happens." I would like to get out of this arrangement as I can use the extra $636 a month and perhaps settle these on my own, since they are charged off anyway. In retrospect, I shouldn't have let my accounts go to collections as SDS advised me to, and tried to make arrangements by myself. They take out over 50% a month for their fees, yet I still do not have enough to settle an account. I feel they are taking money from underneath me, and not duly settling my account. It seemed like a great way to consolidate my accounts in the beginning, then after 2 years of them deducting $636 a month, and NO SETTLEMENT, I feel like the fool here. :mad:

[EllenMargaret]

I want to tell everyone that you don't need to use a service like that . I tried it and the harassment from the creditors destroyed my marriage. Superior Debt Services complacently repeated told me that after 6 months they would start the settlement processes. I inadvertently found out I COULD DEAL DIRECTLY with the credit card companies myself! That is why I am writing this, to tell anyone else who doesn't know. I cancelled SDS and they didn't argue: they got their money up front. So that was wasted money on my part. Here is the key phrase when you call your creditor: ask for the HARDSHIP DEPARTMENT or similar. Talk to the SUPERVISORS, the ones who have Authority. You can make some progress with your problem without having to go through a middle man service. Also, the collection agency I am working with is NICE to me and they don't charge any interest, so I'm making real progress at last. I truly hope this helps someone.

[NCSOS]

We are dealing with Citibank right now, and the previous poster was right, you don't want to mess around with them! My husband had a deliquent acct. with for 6, 500 and after 6 months of not paying, it's now 10,500 that they want and Citi summoned him to court to sue for the money!! We are in WAY over our heads trying to communicate with their lawyer on our own. We really need our own lawyer but can't afford that any more than we can the Citi crap. Our only luck right now is that the court can't order garnished wages for credit problems in North Carolina. But we're still screwed. Try to fix Citibank FIRST!!

[training_day]

Lawsuits are rare, but they happen. The faster you can save money, the better it is for you. It's not as tough you are trying to forget a debt or anything, so stay patient. Good luck.

[training_day]

I should also state that you need to be cautious and watch your accounts closely. It is important that you remain proactive. As one user stated, try to borrow money if possible.