Name: Brenda

Subject: credit cards

Question: my husband and i have lost our jobs with his parents business. we both now have jobs paying 1/4 of what we were making. we are not able to pay our credit cards debt. what can the credit card people do to us? we do own our mobile home, a pickup. and 1 acre of land in which our home sets on. can the sue us and take what little we have? i wrote to the credit card people and told them we had lost our jobs could they lower our interest rates so our payment would not be so high, i received letters back, stating that they were satisfied with their rating they would just lower our credit limit. we have all our card put up and have not use them since our layoffs, so its not like we keep spending. we did use one of the cards to make a 1,000 dollar down payment on a motor cycle to save on gas driving to my husbands work in another state. but the rest was financed through the bank, what will happen there? we both have aprox 10 credit cards all together, the highest one we owe is 4,000.dollars altogether i think we owe aprox 30,000.00 dollars. can they put us in jail? can they take our home/land & pickup? what can we expect? and what steps should we take once the collectors start calling and writing. please help. Brenda

Answer: Let's start with what they cannot do to you. First of all they cannot throw you in jail because you owe money and did not pay. They cannot force you to sell your home/land and they won't be able to take your motorcycle because it isn't paid for. If it were they probably could. What about your pickup? Is it paid for and what model year is it? If it is free and clear there is a possibility they could grab that. They can garnish wages and they can levy against bank accounts and some other assets. So what steps should you take once the collectors start calling and writing? I like to teach people to take some positive steps before they have to start taking negative ones. The first positive step you need to take is to sit down and make a budget analysis of your income and expenses. Start keeping exact track of where your money is going no matter how little you have. You might have to estimate some at first then by actual tracking fine tune it until it is on track and as accurate as possible. Prioritize your spending, keeping the payments up on your home and utilities first then the payments on your vehicles. Don't let your credit card problems turn into a mortgage foreclosure or a repo of your vehicles. Once you have a good idea of how much money you have left over then start looking to see how many of those credit cards you could salvage if you paid on some and let the rest go. Try to keep at least one or two in good standing. You don't need 10 of them. Then, even before they start calling go to my web page at http://www.creditwrench.com/18questions.html and learn how to deal with debt collectors on the phone. Keep any and all letters they send you and be sure that you demand validation before the end of the 30 day window you have within which to dispute without losing valuable rights. Start to visit my web site at http://www.creditwrench.com and my message board at http://consumers.creditwrench.com immediately and start learning how to deal with debt collectors. When it comes to responding to their initial contact letters you need to wait about 25 days from the date on their first letter to respond so as to waste as much of their time as possible and gain the most time possible for yourself. Be sure to send your dispute (validation) letters by certified mail, return receipt requested then go to http://www.usps.com and enter the tracking number there immediately. Then select the option to have the USPS send you an e-mail each time the letter moves from one destination to the other. You should use our series of hard hitting letters to get the most effective results possible. Each of them go out on a tight time schedule. Our basic creditwrench course contains 5 letters some of which will be used multiple times on the same debt collector. Once the accounts have been turned over to an attorney for further action you need to start the series all over again. Demand validation of attorneys too. Creditwrench can help put you in the driver's seat instead of them. That helps a lot.