The bank learned that I'm on a debt settlement program and...

[eakub]

they immediately sent me a letter from their attorney's office stating that they intend to sue.

I had always been up to date with my payments. But my hours were being cut at work and I was barely scraping by each month to make those minimum payments. Then, luck finally seemed to be on my side! The government finally (after many years of applying) decided I was poor enough to receive grants for school. Here I was thinking that a better life and income was just a few years away! I thought about it for a really long time because I had to be a full time student to receive the grants... which meant even less of an income to pay those bills. So I chose a debt settlement agency that promised to help settle my debts and I would have a more affordable monthly payment.

Anyway, to make a long story short, my credit union called after I missed one payment on my personal loan. ONE PAYMENT. They said that if I didn't pay them, then they would turn my account over to my attorney and have my wages garnished. I explained to them that I was working with a debt settlement company and that they should be talking to them about my debt. I called my debt settlement company and told them what was going on. They said that they called my credit union and faxed them a copy of the form I signed granting them power of attorney. About a week or so later, I receive a letter in the mail from the credit union's attorney. It said that I had to reply to the letter within a few days... otherwise they were going to file a lawsuit ASAP. My settlement company said not to call them... they said that they would handle the attorney.

What should I do? All I wanted was to go back to college and finish my education!

[nascar]

What should I do? All I wanted was to go back to college and finish my education!

What does this have to do with going back to school?

Your agreement with the debt settlement company notwithstandng, the credit union is free to accelerate your loan if that is part of the T&C. People hear "debt settlement"- that means "not going to get paid." Generally, nothing good comes from using these companies.

[IHateCAs]

Better get current on that CU debt.

[eakub]

This has everything to do with going back to school. In order to receive my grants, I have to be a full time student. If I'm a full time student, then I can't work as much. If I can't work as much, then there's no way I can keep up with my bills. I thought that the settlement option would help me manage the bills that I wouldn't be able to pay. There was no need to be rude...

I don't know how I can get current with my credit union now... I seriously don't have the money now. All of the money I was using to pay my debts is going into a settlement account so my debts can get paid off that way.

[IHateCAs]

I don't know how I can get current with my credit union now... I seriously don't have the money now. All of the money I was using to pay my debts is going into a settlement account so my debts can get paid off that way.

HMMMMMMMM

Maybe you should stop using that debt settlement company that hasn't wasted any time screwing you over?

[dazedandconfusedincali]

IHateCA's is right. Stop paying the debt settlement company to ruin your credit. Those companies are total ripoffs.http://www.creditinfocenter.com/debt/

[nascar]

This has everything to do with going back to school. In order to receive my grants, I have to be a full time student.

Have you considered taking some of your classes online?

[eakub]

Have you considered taking some of your classes online?

I can't... I'm majoring in biology and I want to minor in environmental studies. They don't offer online classes at the college I'm going to be attending and I've never heard of any online biology classes from anywhere else.

[eakub]

IHateCA's is right. Stop paying the debt settlement company to ruin your credit. Those companies are total ripoffs.http://www.creditinfocenter.com/debt/

I am totally aware that my credit will get messed up. I really don't care... I just wanted my debts to go away as quickly as possible. Debt settlement takes about 3 years... debt consolidation takes 5 to 7 years. I really don't care about whether or not I have good credit at this point. I just don't want my credit union to sue me after only one month. I think that is a little bit extreme... most people don't get sued until their accounts have been delinquent for some time.

Anyway, all I wanted was an answer to my original question.

If the letter I received says I need to call them... should I call them? Or should I wait and let the debt settlement company call them and work something out?

What would be a better solution? Take the loan off of the program and pay it off separately? Or allow myself to be sued?

Will being a student work in my favor if I have to go to court? Or would a judge count that against me?

I don't feel that the settlement company is necessarily the problem. They are a member of the BBB and they have a good record with them. I asked tons of people prior to signing up for it and everyone agreed it was a good idea (including my parents and a coworker of mine who's day job is working for a student loan company).

[direred]

This is a link to another board, but read both threads in their entirety.

http://creditboards.com/forums/index.php?showtopic=196973

http://creditboards.com/forums/index.php?showtopic=267316

[SecretAgentWoman]

Debt settlement companies DON'T pay your debts - only take money, don't pay, and wait for your creditors to be desperate enough to take ANYTHING. Meanwhile "debt settlement" DOES NOT MEAN "save my credit" - it's usually the OPPOSIT - debt settlement RUINS your credit.

In addition, as you can see, since "debt settlement" means "not getting paid" or "paid for less than owed" to the debt companies, they CAN and WILL sue you to make sure they don't loose money.

So, if you are OK with ruining your good name, your credit for years, and being hauled into court for possible wage garnishment and hefty judgements, by all means, keep using your "debt settlement" company.

Myself, I would keep paying my bills and negotiate with my creditors directly. I'd work full time nights and go to school days to save my good name. But that's me.

You are single, right? Try working full time, being a single mom of three, AND going to school full time like me then come back and whine to me how hard it is. Man up, nancy, you can do it if you want to.

[jetscarbie]

eakub..I totally applaud you for wanting to go to school to make a better life.

Most people on here have already experienced debt places. They haven't been a good experiences. Why pay someone tons of money to screw your credit up even worse than it already is? All you are doing is paying someone NOT to pay your bills. You can do that yourself. Most of your bills you could probably call and make settlement arrangements without using a debt place.

I would talk to the credit union. I would get rid of the debt place. I would make separate arrangements for all my bills. I would try to make favorable arrangement with the credit union (from my experiences, they don't play around)

Being a student probably won't work in your favor. Judges and lawyers don't care about stuff like that.

Just my 2 cents. Good luck.

[eakub]

You are single, right? Try working full time, being a single mom of three, AND going to school full time like me then come back and whine to me how hard it is. Man up, nancy, you can do it if you want to.

No... I am married. And last time I checked, my husband wasn't gay... so I guess that makes me a "Nancy", huh?

My husband owes about 3 times as much as I do. Just because you're a single mother of three doesn't give you the right to judge how difficult my life is. I already lived that life when I was a child... my parents made a lot of mistakes and believe me, it wasn't fun. At least I learned enough from them not to bring innocent children into the mix. I wouldn't dare bring children into my current situation.

[merkurfan]

As someone who has been there your stuck between a rock and a hard place. But, let me give you some advice when it comes to school. I'll forewarn you. Your NOT going to like it.

Wait..

Yup, wait. You've got yourself a hole and even if the government is going to give you grants your likely to dig that hole even deeper. Are the grants going to cover everything for school? Housing? Food? clothing? Spending money? Unless they have gotten very generious since i went to school the awnser is no. Do what you need to do to get on top of things. At this point going to school is just going to make your debt matters worse and distract you from learning.

Don't ask me how I know this.

I think "man up" is her way of saying toughen up. Due to health issues my wife was forced to quit her job. I have with out compliant taken up the slack. I'm done with school but am working 70-100 hours a week to get cought back up and on top of things. We all understand the situation your in. Many of us have been there before. Life is full of hard choices to make, the one your faced with now is one of those. While I won't disagree that schooling is very important so is your credit health and the health of your relationship with your spouse. Money is the #1 factor in a lot of break ups.

[eakub]

eakub..I totally applaud you for wanting to go to school to make a better life.

Most people on here have already experienced debt places. They haven't been a good experiences. Why pay someone tons of money to screw your credit up even worse than it already is? All you are doing is paying someone NOT to pay your bills. You can do that yourself. Most of your bills you could probably call and make settlement arrangements without using a debt place.

I would talk to the credit union. I would get rid of the debt place. I would make separate arrangements for all my bills. I would try to make favorable arrangement with the credit union (from my experiences, they don't play around)

Being a student probably won't work in your favor. Judges and lawyers don't care about stuff like that.

Just my 2 cents. Good luck.

Is this why everyone on here is so rude? All I asked was a question and I got my head bitten off.

I agonized over the decision to sign up for debt settlement for months. I really didn't know what else to do... I felt completely backed into a corner. Now it looks like I may have to pay for yet another mistake. I'll owe the settlement company money too, you know?

[eakub]

As someone who has been there your stuck between a rock and a hard place. But, let me give you some advice when it comes to school. I'll forewarn you. Your NOT going to like it.

Wait..

Yup, wait. You've got yourself a hole and even if the government is going to give you grants your likely to dig that hole even deeper. Are the grants going to cover everything for school? Housing? Food? clothing? Spending money? Unless they have gotten very generious since i went to school the awnser is no. Do what you need to do to get on top of things. At this point going to school is just going to make your debt matters worse and distract you from learning.

Don't ask me how I know this.

Actually... I'll have enough to cover tuition and books... plus a little left over to keep in case I have an unexpected expense (e.g. I have to go to the doctor). I won't have to pay any of it back. I qualify for several different grants, plus some scholarships that the college has awarded me as well. I'll still have my job... I'll just be working less hours. I have everything budgeted out to cover the utilities, food, gas, and my payment to the settlement company. I won't have more debt.

[merkurfan]

Fire the settlement company. anything they can do you can do yourself. your creditors would much rather deal directly with you.

I gathered from your post that your already behind on your debts. I just can't see going to school helping you much when it comes to getting cought up.

[IHateCAs]

And last time I checked, my husband wasn't gay...

How often do you check?

j/w

[jetscarbie]

eskub..I wasn't trying to give you a hard time at all.

Your not the only person on this board to make mistakes...heck, I think that is why most of us are here.

I have also been backed in to the corner before....trying to figure out just how to breathe again.

I think everybody was just trying to tell you about the debt settlement company b/c most have been through it.

Again, good luck

[IHateCAs]

Is this why everyone on here is so rude?

I think you are confusing disagreeing with you for being rude.

[IHateCAs]

Problem: I don't have any money to pay off my debts because all the money I would use to pay those debts is going to a debt settlement company that isn't paying my debts.

Solution: Cut out the middle man.

[eakub]

eskub..I wasn't trying to give you a hard time at all.

Your not the only person on this board to make mistakes...heck, I think that is why most of us are here.

I have also been backed in to the corner before....trying to figure out just how to breathe again.

I think everybody was just trying to tell you about the debt settlement company b/c most have been through it.

Again, good luck

I didn't say you were being rude... I meant everyone else. What's up with being called a nancy?

[eakub]

I think you are confusing disagreeing with you for being rude.

Well, you did ask how often I checked to see if my husband was gay.

Anyway, I don't want to fight with people... I just don't like it when people who disagree with me imply that I'm stupid. To me that is rude... its fine if you disagree though.

[IHateCAs]

Well, you did ask how often I checked to see if my husband was gay.

It's not rude to me so much as it's funny. It's an odd expression if you think about it. How often do you check and more importantly, HOW would you check that?

Do you have a gay guy come in wearing speedos to see if he can tempt your husband? That'd be pretty awkward.

At any rate, I think the consensus here is to stop using the settlement company. I would also add in that you should relax some and laugh, even if your financial life sucks atm.

[nascar]

I can't... I'm majoring in biology and I want to minor in environmental studies. They don't offer online classes at the college I'm going to be attending and I've never heard of any online biology classes from anywhere else.

Maybe so, but there's no point in devoting seat time to core curriculum and filler electives if you can take them online. You can take your major concentration courses on campus.