Wow! I just discovered we owe $13K! HELP!

[mikeylikesit]

Hey, I need a little advice from soneone who has been in a similar situation.

I recently discovered we had an old credit card that had not been paid off, and the account has been adding interest for 5 years. When the account went delinquent, it had a balalnce of $5,000, and has now grown to $13,000.

I guess that's what happens when youdon't check your credit report!

Anyway, the card is in my wife's name only, and I am looking at calling the collection agency and settling the debt, probably for around 6 or 7K I would imagine.

My question, however, is what happens if I don't pay it at all? I mean, I know it would fall off my wife's credit report, but that doesn't stop collection actions and or garnishment, does it?

I realize it would continue to kill my wife's credit, but does it do anything to mine? Can they garnish MY wages, as her husband?

Any help in answering this question would be greatly appreciated. I will likely call and settle the debt, but want to know if this is the best approach. (Yes, we received a notice three years ago, I thought it was an account we had been paying off, and have subsequently paid it all off, but it was actually a second card through the same company) Thanks! Mikey

[poundwise]

I can't provide a comprehensive answer at this time but perhaps this article may help:

Settling your debts by Credit Infocenter

[Fizgig]

I don't have the answers to all of your questions, but before you talk to them at all, check the statute of limitations in your state.

http://www.fair-debt-collection.com/...mitations.html

If the debt is "expired", she does not legally owe the money unless she sends a payment or promises to send a payment.

Credit card companies cannot garnish wages unless they file and win a lawsuit, which hardly ever happens.

(Note - I am not at all suggesting that it's okay to not pay back a debt. I'm just trying to give usefull information about the law.)

[Broken Arrow]

To add, debts in your spouse's name would not affect you directly.

[creditcardfree]

Originally Posted by mikeylikesit

I will likely call and settle the debt, but want to know if this is the best approach. (Yes, we received a notice three years ago, I thought it was an account we had been paying off, and have subsequently paid it all off, but it was actually a second card through the same company) Thanks! Mikey

Just to be clear then...you aren't been double billed for the same charges from the company?

I think your best bet is to try to settle it. Just be prepared for some jerking around on their part. They love to do that. Also get your settlement agreement in writing BEFORE you send them any money. Do not give them access to your checking account for a debit transaction. They may take the whole amount if you do.

[vishenda]

If you don't pay then your wife will get an R9 on her credit rating. not a good thing to have. if you make a settlement, then she will get an R5. when you call up the company, they will want you to settle as close to the current balance(13,000)but stick to what you are wanting to settle for. in this case i would recommend a settlement just to get it over and done with. an R5 isn't that bad, it basically just shows that there was a settlement made. avoid the R9 at all costs. they can't touch anything in your name, like wages or anything. it won't ruin your credit either, b/c your name is not on the card. go ahead and make the settlement. and dont' forget to ask for a confimation #.

Have a super day!

[instantinfo4you]

I agree with vishenda. In this case it is probably best to settle. Assuming the statue of limitations has not expired. Try to negociate your debt down as far as possible before paying it off, and definitely don't give them access to any bank accounts, or even any other credit cards. I have had a similar problem with medical payments.

[PRICEPLUS]

MAke the best deal you can. That is a ton of interest. Do you have any other outstandiing debts that may be due. Best to check!