ewitte Posted January 15, 2008 Report Share Posted January 15, 2008 Is there any way to force a lower interest, possibly through court action? The issue is I've alreay been having trouble making payments and ended up a few days late on Bank of America credit a few times and now they have my interest at 32% (I started lower than 5% and that was not intro) and they refuse to budge from that for 6 months. This nearly doubled my payment when I was already having trouble. Half of the problem is their checking fees. I've been charged as much as $300 for going over around $20. Then it messes up more CC payments and with other companies as well. I'm tempted to just default but its $7000 right now and I don't know what to do if it goes to court. They already messed up my credit pretty bad so if it were possible to string things out 4 years it can't make things much worse. If I can't do anything with them than my car is permanantly behind by $400 (not a complete month) and I need that for work.I'll pay if its possible but I went from a monthy payment when the account opened of about $70/mo and now they are asking close to $300/mo for the same debt. Its been fairly constantly at my balance for 2 years or so. Link to comment Share on other sites More sharing options...
ewitte Posted January 16, 2008 Author Report Share Posted January 16, 2008 Bump. How safe of a plan would this be? Send a certified return receipt letter to the bank explaining with the increased interest I am no longer able to make payments. I contacted the bank 3-4 times and was unable to resolve the situation over the phone. Offer them to continue to make payments on the current balance, minus future fees and interest incurred waiting on a response from them, at a locked rate of 9.99% that can not be increased. This interest is still higher than it was when the account was opened. Explain that I have no problems letting it go to collections or court if they fail to meet these conditions.If it comes back to me at a future date for court I'll have proof that I tried to resolve the situation with them.Eric Link to comment Share on other sites More sharing options...
jq26 Posted January 16, 2008 Report Share Posted January 16, 2008 If it comes back to me at a future date for court I'll have proof that I tried to resolve the situation with them.This doesn't prove or disprove anything. If they sue you within SoL and they can prove the debt is yours, then they win. My suggestion is you talk to somebody in the hardship department. My close friend is going through hard times and has fallen behind on a few cards. He called the largest creditor, they froze his limits (no moer charges allowed), and actually gave him 0%apr on the debt balance so long as he continues to make substantial payments to pay it off. They even offered him a 40% reduction in the total amount owed if he can pay it off in full but he doesn'thave the money to do that. My point is, they make work with you because it is a lose-lose if you BK or they have to hire an attorney to sue you. Link to comment Share on other sites More sharing options...
ewitte Posted January 16, 2008 Author Report Share Posted January 16, 2008 This doesn't prove or disprove anything. If they sue you within SoL and they can prove the debt is yours, then they win. My suggestion is you talk to somebody in the hardship department. My close friend is going through hard times and has fallen behind on a few cards. He called the largest creditor, they froze his limits (no moer charges allowed), and actually gave him 0%apr on the debt balance so long as he continues to make substantial payments to pay it off. They even offered him a 40% reduction in the total amount owed if he can pay it off in full but he doesn'thave the money to do that. My point is, they make work with you because it is a lose-lose if you BK or they have to hire an attorney to sue you.They actually did transfer me to the hardship department one time and that didn't go well. I've pretty much been paying interest and fees for the last two years so IMO its not completely my debt. I'd rather make the offer in writing and let it go to court if thats the way things go. If they really don't want to hire an attorney then hopefully they accept the offer. I'm offering to pay the full current balance at a rate higher than when I signed up for the card. I think thats completely fair.Eric Link to comment Share on other sites More sharing options...
jq26 Posted January 16, 2008 Report Share Posted January 16, 2008 Well, I guess it is worth a shot. Just beware that they may sue you for a balance like that. And the dispositive question in court is if it is your debt, not whether you attempted to settle or not. Link to comment Share on other sites More sharing options...
ewitte Posted January 16, 2008 Author Report Share Posted January 16, 2008 Well, I guess it is worth a shot. Just beware that they may sue you for a balance like that. And the dispositive question in court is if it is your debt, not whether you attempted to settle or not.Question. If it did go to court would it be likely to get the judge to settle at the current amount owed at a fair interest rate? Basically what I'm asking for now. Like I stated I don't mind paying it but its unrealistic to expect me to be able to pay double my old payments because of an interest hike when I had trouble paying them in the first place. I've got statements from at least 4 months showing their checking service drove my account balance VERY negative. As much as $-300+ last September. Link to comment Share on other sites More sharing options...
ewitte Posted January 16, 2008 Author Report Share Posted January 16, 2008 Lol. I tried hardship services again and they were talking about a payment plan possibly being the solution. Then they declined me Link to comment Share on other sites More sharing options...
jq26 Posted January 16, 2008 Report Share Posted January 16, 2008 Hopefully an attorney will chime in, but the rate hike in your balance was part of your agreement. The clock is ticking at the higher default rate at this point. If you are covering just the interest (or less than interest), than you haven't paid a penny towards the debt balance yet. I know mathematically you have "paid" more than the original balance, but that doesn't matter. This is why these potentially high % debts are so dangerous. Once they snare you and ratejack you, they are twice as hard to dig out of due to the interest charges. I know you know that now. Typically, they will sue you for the full balance + all of the interest (clock keeps ticking) + court costs. And then get a judgment. At that point, there is a statutory post-judgment interest rate that applies (so the clock keeps ticking but not at the oppressive pre-judgment rates). Whether or not the court feels that the rate is too high or too low is of no consequence so long as the rate charged is not prohibited via statute.Post Judgment Interest Rate: U.S. District Court"Such interest shall be calculated from the date of the entry of the judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment." Link to comment Share on other sites More sharing options...
jq26 Posted January 16, 2008 Report Share Posted January 16, 2008 Lol. I tried hardship services again and they were talking about a payment plan possibly being the solution. Then they declined me Why did they decline you? Link to comment Share on other sites More sharing options...
ewitte Posted January 16, 2008 Author Report Share Posted January 16, 2008 Why did they decline you?It was basically new credit moving the card over and closing out the old account. They said they were sending me something in the mail. Link to comment Share on other sites More sharing options...
jq26 Posted January 16, 2008 Report Share Posted January 16, 2008 Maybe it is some sort of program to get you back on a payment plan. The problem is that it is a small enough debt that BK is likely not an option unless you have a ton of other unsecured debt, but large enough that, combined with the high interest, it is a monthly killer. To answer your original question, I don't see any legal leverage to force them to lower your rate, but the threat of non-payment or the spector of BK may be enough to have them set up a reasonable payment plan to keep you paying. Whatever you do, get it in writing. And then abide by it. Good luck. Link to comment Share on other sites More sharing options...
ewitte Posted January 16, 2008 Author Report Share Posted January 16, 2008 Maybe it is some sort of program to get you back on a payment plan. The problem is that it is a small enough debt that BK is likely not an option unless you have a ton of other unsecured debt, but large enough that, combined with the high interest, it is a monthly killer. Its just the worse offender and dragging down all the rest. I've got a total unsecured of about $25k... just this one is way worse in payments. I've got other pretty high interest ones but they are $1-2k so not hurting as much. Link to comment Share on other sites More sharing options...
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