Credit Card debt

[preyes1957]

My credit union close my credit card because I paid past the due date on a few occasions, I was never late over 30 days and was up to date when the account was closed. Since then I've lost my job but have always paid on time and the account is up to date. They have already mess up my credit, should I keep paying on the balance or should I stop? Would there be anymore consequences to my credit then already is? Do I have any options? I owe $6,000 and my credit line was $8,000

P.S. I've been a member of the credit union for 31 years and paid off 4 cars along the way.

[littleroc02us]

I would suggest not paying your credit cards right now since you lost your job. They will start calling you, but you tell them you don't have any money. Do not, I repeat do not use your credit cards. Start taking whatever money you have and start saving it for the day when they sue you and you can settle with them for a fraction of what you owe. Better yet, get another job and start paying off the credit cards. Forget the membership, there are other banks.

[JoshuaHeckathorn]

Focus all your attention on getting another job fast. At least find something part time to get through this period until you land a full-time position. That's the most important thing here.

If you have enough savings to cover your living expenses and still stay current on your debt, then I wouldn't just quit paying your credit card at this point. If you do, your few late pays will turn into charge offs, collections, and perhaps even a judgment, which will trash your credit history even more. If you're having trouble making the payments, call up the CU and see if you can work out a repayment plan that works for you.

Best of luck on the job search! Oh, and if and when you do start using credit cards again, vow to never carry a balance. Only buy what you can afford to pay off each month.

[Hector]

Sorry to hear that you lost your job. Do you have money to take care of your needs before you find new job? If so, I would continue paying this credit card. If you dont have money, no discussion needed as you can not pay simply because you dont have money to pay it.

[KennySoward]

I agree with the other posters here. You have a couple of priorities before you pay them back.

1) Get some income rolling in (a stable job).
2) Try to keep any of your remaining good credit cards/loans from going into default. The ones that are already in default...the damage is done.

[excelsior7032]

I never advise letting credit charge off. If you can make the minimum payments and get by, I would suggest that. I work in retail finance, and I speak with people who are in this situation every day.
One thing you can do is call and discuss the situation with the lender, as long as they have an understanding of your situation they MAY be more willing to work with you. Some lenders won't budge... some will.
If you have several credit cards, I will usually suggest a NON PROFIT consumer credit counseling service. do NOT go to a place that will charge you a fee, they usually rob you blind. I highly advise AGAINST bankruptcy, that will hang over your head for a long time and once you find work and reestablish yourself, it will linger on your credit report.

Hope this helps, any more questions please ask

[jerrycates]

Try and do things that will help you declutter. Do not by all means.

[jeffery12]

its my experience. usually credit card interest rates are quite high.. having a credit card in hand calls every silly/unimportant purchasing an urgency. at the time of making the payment, we might not be having enought amount to clear the duees; which would then led to huge interest rate and it would thereafter, keeps increasing your due amount. recently I had to apply for a personal loan and clear all my credit card dues in an idea to clear my debts in the possible less interest rate.

[CCCFree]

I've been working for a consumer credit counseling organization for about a year so I hear this on the credit counseling floor a lot.

Basically what you can do is contact your creditors yourself and tell them your situation and to try to negotiate some better terms on your interest rates, and waive late fees OR try and get them to give you a 60 day grace period until you become gainfully employed.

It wouldn't hurt to try and ask!

[SarahJ]

All good advice here. I just would like to add, that these banks are not your friends. They want your money and that's about it. They make more money when you fall behind and not paying them makes them even more. They will stay rich and you will get stuck with a massive debt on your credit. The advice about keeping everything else current it what I agree with the most. If you still have some good on your credit try and keep it that way until you can negotiate otherwise. These days even bad credit will keep you from getting a job. If I were you I would think of a way to work for myself.. Good luck with everything, hope you get a job soon.

[Michael01]

You should ask the company about this by sending them email aur letter so that your problem can be solved

[alphadore]

I agree. Consult to your company.

[LMA]

Originally Posted by preyes1957

My credit union close my credit card because I paid past the due date on a few occasions, I was never late over 30 days and was up to date when the account was closed. Since then I've lost my job but have always paid on time and the account is up to date. They have already mess up my credit, should I keep paying on the balance or should I stop? Would there be anymore consequences to my credit then already is? Do I have any options? I owe $6,000 and my credit line was $8,000

P.S. I've been a member of the credit union for 31 years and paid off 4 cars along the way.

Since this is a credit union I would go in there and talk to someone, explain your situation and ask for help. At credit union you actually have a chance of speaking with someone that has half a brain compared to the mega banks.

However, if they don't help you out you should terminate all business with them.

Since you have lost your income I would suggest making only minimum payments if you can if not stop paying and when they begin harassing you explain your situation but ignore them and tell them you will get back to paying them when you have an income again.

Wether they mess up your credit or not is not the biggest issue. The issue is they will keep on harassing you and possibly sue you for what you owe them if you don't pay them. You might also want to see if you can get them to settle the debt for less than owed if you have $1,000 or $2,000 offer them that and see if they will take it but only if they accept that as FULL settlement of the debt. And of course get it in writing.

[Obiwan]

I agree with all the prior comments. I would just add that as a general rule of thumb, you don't want this account to get sold to an outside collection agency, that's when the chance of being sued or harassed will increase.

Most times, the CC company will charge-off about 6 months from the time they received the last payment. After the charge-off, they usually make one last ditch effort to collect the money before selling to an outside collection agency or suing.

since you don't have any income right now, i wouldn't make my monthly CC payments, just focus on food, shelter and keeping the lights on. If you can make a settlement offer to the cc company, i would do it during that window between the charge-off and b4 lawsuit. I've heard settlements are usually about 50% of the balance, but i've seen some cc companies go as low as 30%.

Good luck.

[emmajacob36]

I am totally agree with the above comments. I would suggest you to find a better job first. If you can't find a full time position then at least find any part time and try to negotiate with the creditor for the time being and tell them your situation. I hope you will find a better job soon.

[Nightfly]

If you let the CC go to charge-off, it could be well over a year or two before a collection company decides to file a judgement against you. Even if a judgement is filed, you can work out a deal with the collector before the whole mess gets before a judge. If a judgement is filed, the burden is on the collector to actually get the money. If you still don't have a job at that point, the collector can't (as the saying goes) draw blood from a turnip.

As many of the other posters indicated: focus on finding work, and paying for essentials. Don't worry about the cc right now. The charge off might work its way through two or three collectors before one of them decides to file a judgement.

[naomibatac]

I have been in that situation before. I am always on time with my monthly payments, but something happened that forced me to quit work and I was only delayed for 2 payments. The bank demanded full payment of the balance. What I did, I negotiated for a structuring and asked for a minimal monthly amortization. I paid the everything and was not given a bad record. I now have a Visa unsecured card. My advice, pay it off in order not to ruin your credit terribly.