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Current, future employment - what affects?


bkbob63
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Hi all,

I am debating doing debt settlement for $50k+ debt that I accumulated over the years as a pay cut and medical bills for kids has made minimum payments impossible. At the same time I am looking for a better paying job and may have something interesting in the next 1-3 months.

I am current, though maxed across multiple cards, credit score is already down to 575.

I have a few concerns:

I work for one of the banks I would look to settle with (though completely separate businesses), and also have my checking acct there. I assume it would be smart to open an acct elsewhere to be safe. I am slightly concerned about affects on current employment as well as conflict of being listed as an employee and chance for settlement.

I am currently interviewing (in the financial services sector) and there is the possibility that I find something new/better paying in the next 1-3 months. Concern there is of course if they run a credit check which shows not only my credit score, but the fact that if I go ahead with the debt settlement plan, I already would be late (potentially 30-90 days) on 8 cards.

Anyone have any experience with this?

I'd try to settle with a few prior to getting behind, but it sounds as if they won't play ball until you are late (60 days+). Plus I understand if I am current on some but others, they may also be less inclined to settle.

Lastly, as far as my story, will they have ability to see what I make and use that against me? How much will I need to sell my hardship (all true).

While I may seem to make fairly decent $, my expenses due to salary cut and medical expenses has made it impossible to continue as is and I cannot sell my home as I am near upside down. And what if I do get a new job in the midst of waiting out the settlement offers?? Would the new salary come into play?? What, if anything, needs to be documented if/when you are looking to settle?

Sorry for the long post.

I appreciate any insight into any questions posed.

Thx!

Debts are with the below:

HSBC

Wells Fargo

Chase (x2)

US Bank

Discover

AMEX (Gold, Blue)

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Bad credit mainly affects jobs where you either handle other people's money, you could steal inventory or you may become privy to confidential information you might sell to a competitor.

I know of people who have obtained very high paying jobs with very poor credit (charge offs almost across the board). They were told there was going to be a credit check, but if there was one the employer never mentioned it again.

Don't hose the bank where you work if you can avoid it at all. Some creditors may be understanding about that. Others likely not.

As for paying some but not others--that is a problem in their eyes (not necessarily in yours). Bankruptcy courts call doing that a "preference" (in some cases, a "voidable preference") and it's a bit of a dirty word over there. If you're not in bankruptcy though you retain the power (if not the right) to direct your payments according to a scheme of your own devising, or even arbitrarily so long as nobody gets around to suing.

The pool of potential employees out there is increasingly damaged goods from a credit standpoint, and while you shouldn't let anybody suggest that you can cavalierly bomb out your credit, a 575 isn't doing you a lot of good even though you are remaining current. So remaining current may have diminished value versus doing something uglier that could put it all in the rearview mirror.

I seldom recommend bankruptcy, but if you could do a clean Chapter 7 prior to any serious default or delinquency, you could emerge with a quite favorable credit rating and a good, medical-based explanation for why it was necessary--potential employers will usually be OK with that.

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Agreed. A BK (for medical reasons) is explainable. It would be better if you could pay your potential employer in full, but you'll have to explain that to the BK trustee and that might be difficult.

And...do not make the mistake of getting a debt settlement company involved. They're all scams, and will not help your situation.

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Hi and thanks for responding.

Unfortunately (fortunately?), I don't qualify for Chapter 7 (above median income), and Chapter 13 doesn't make $ense for me.

I'm uneasy about stopping payments on all cards until I secure a new position, and that window is likely from now through March. As much as I want to get the ball rolling, I may need to find a way to stay current for 2 more cycles and hope that if I do secure employment elsewhere, credit checks OK. Ugh I just want this over with but I know it took me a while to get into this mess and can't expect a quick fix.

Anything positive to say about so-called "coaching" services like zipdebt? I was thinking this may help w current settlement %, but not sure if I can get same info from the forums.. So far, I have been reading and reading all about settlement online and in great forums like this, yet still am undecided abouy these flat fee services which seem somewhat reasonably priced.

thx all

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Thanks.

That service from what I hear is diy, has some deiscsa for a program, and just added "security" of having an experienced "industry insider" to help along the way with any questions and current data on what settlement % are out there per creditor, as well as guiding you through the negotiation process.

I agree, may not be needed, but at $400 (or $800) total, depending on teh package, it doesn't sound like much for peace of mind.

The question is, is it simply a false sense of security?

**they do offer 365 day $ back guarentee as well..

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ALL debt fixers (and advisors) that charge you money are scams...and, until and unless they actually turn positive results, it is illegal for them to take any money from you. They charge you for doing things you can do yourself...and getting a 3rd party involved negates some of your rights under the FDCPA.

Do it yourself...

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thanks willing, I hadn't thought about FDCPA.

I think my biggest issue is knowing how to time my negotiations as well as expected range I should expect per OC based on current times and my own situation. I am hoping forums like this can assist and act as a resource as I go through the process. Any current tips regarding expectations, things to look out for would be appreciated. That said, until I commence the process, and provide additional info, I understand that may be difficult.

I really do appreciate all the prompt responses.

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