debt collecting firm calling, do i need attorney?

[brokeisbad]

A credit card debt of mine was recently turned over to a law firm for collection. I have been unemployed since June 2008 and have relocated to live with relatives in California from Illinois (debt was in IL). The debt (unsecured, approximately 2500) was with FIA card services (Bank of America) and they have written it off and sent it to a collections firm. I am willing to negotiate some type of payment plan with this firm, and hope to avoid any type of lawsuit. I would also like to avoid bankruptcy.

However, I really don't have much $ to work with and was hoping to begin making payments again as soon as I found employment (which is proving difficult and is taking a long time). I did just receive a tax refund and am willing to put that towards the debt (about $500) but other than that I have no means to pay or negotiate. I am scared to answer the phone calls from the collecting attorney as the research I have done all says to avoid phone conversations. Do I need to hire an attorney? In Illinois? or in California? I do not think that is something I can afford, and would prefer to just work directly with the collector, however I am clearly not knowledgeable in this area.

Any advice on what to do is greatly appreciated. I really hope to avoid a lawsuit. Thanks.

[OMGWhatHaveIdone]

When did you move? Did you provide notice to BOA of your change of address? Have you tried to contact BOA to see if they can work out something? Most CC companies have a hardship department that can try to work out something with you until your situation changes. See if the OC would be willing to pull the account back in exchange for a work out agreement. If they agree to this, remember to get it all in writing. If they refuse to send you anything in writing outlining the terms of the agreement, then don't agree to their terms. Additionally, do not provide them with any bank account information at all. Do not give them that sort of control over your money.

I understand that you want to work this out, but you need to remain in control of the situation not them.

[Robert Nashville/Savannah]

....

The very first thing you need to do is stop being afraid because actions taken out of fear (or most any other emotion for that matter) are often if not usually worse than taking no action at all.

Remember that this is a debt; it’s not even that important of a debt…i.e.; keeping your home mortgage (debt) paid is a LOT more important than paying a credit card…any credit card. This is not a criminal matter…they can’t come and arrest you for not paying the debt so relax and take a deep breath.

The second thing you need to do is reconcile yourself to what you CAN do. Obsessing about what you should do is not helpful if you can’t do it. What I mean by that is, for example, common sense would tell you that what you need to do is pay your debt…that’s fine, except you can’t pay your debt so wasting time worrying about paying it right now is just that, a waste of time. Likewise, needing an attorney is moot if you can’t afford one (and frankly, at this point, you really don’t need one).

Contacting the original creditor is not a bad suggestion but if you don’t have any income right now I can’t see any sort of “hardship” program they have being helpful to you.

So, what I suggest that you both can do and should do right now is to spend some time reading the posts on this board and become acquainted with what others have done in your situation. Then, sit down and craft a simple, straightforward letter to explain to your creditor your situation and that while you want to pay your debt and intend to do so, right now that is simply impossible. Send this letter to both your creditor and the CA (he really is just a collection agent…don’t get hyper about their “law firm) .

Be direct…tell them where you are…explain to them that you will keep in contact with them so keep them apprised of your situation and that as soon as things turn around for you, you’ll start paying on the debt. As you do have any income coming in, I’d start paying something…consistency in doing that is more important at this point than the amount.

Eventually, things will turn around and then you can put this behind you.

Now, they may or may not sue; in fact they probably will at some point but that’s likely not going to happen tomorrow or next month and while I understand that you want to avoid that, you can't control what they do...nothing short of paying off the debt entirely will prevent them from eventually suing you. However, when/if they do sue you, they can’t take what you don’t have and it still isnt' the end of the world.

The word "bankruptcy" shouldn't even be part of your vocabulary right now...filing a bankruptcy on a $2,500 debt would be like using a nuclear bomb to kill a mosquito.

Absolutely DON’T use what little funds you do have to pay “some” of the debt – you are in a FINANCIAL EMERGENCY which means you circle the wagons, protect yourself and keep the necessities of life covered before you ever consider paying on a debt; especially an unsecured debt.

It’s just a credit card debt.

Take control of the situation and don’t let it control you.

I wish you well.