Expert: Creditwrench
Date: 12/14/2007
Subject: car repoed received collection call

Question
Hi! I bought a car about May 2005. after several months i could not afford to pay it anymore. So I ended up having the car repoed around March 2006. Just this morning i recieved a call from a law office stating that I owe 7000 and i have to pay for it or at least make a payment plan. I haven't received any letter or call from that office not until today. The guy told me that if i would make a payment as soon as possible they will sue me. I would like to ask what is the best option for me to do I dont have any money to pay and i just had a vehicular accident. I also have a lot of other bills. Is filing a bankcruptcy an option.

Answer
Bankruptcy is an option but certainly a very poor one. It will leave it's mark on you for the rest of your life in the form of a public record that will never go away. And yes, it will disappear from your credit report after a few years but not from your public court records. It is expensive too.

But there is a viable alternative. It is administered by the federal court system and it is actually far more effective than bankruptcy at getting rid of debt, leaves little or no trail on credit reports and usually ends up being free. Quite often a nice profit is made for the debtor in the process. The only real drawback is learning how to do it. We talk about it on our conference calls which start at 7:00 P.M. central time every Friday night.
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