I’m Jane and I joined this blog just a bit ago. I’ve read a lot of the messages and am pleased with how helpful members seem to be. Here’s a little about my situation, my story if you will.

My husband and I don’t have any current debt right now – no house payments as we lost our house in foreclosure very recently, no car payments, and no credit cards. However, we both have old debt on our credit reports totaling about $15,000. Some of that is debts that have been charged off.

This summer I’ll have a few thousand dollars that I could put toward those debts but I don’t know the best way to handle it. The money won’t be enough to pay ALL the old stuff but it could make a dent in it. But we also need to save some of the money.

Keep in mind that we only have about $1100 saved right now, DH owns a 6 month old business with a wildly varying income, and I work retail for slightly above minimum wage, with hours being cut. And soon we will have to find another place to live.

One of the things that stumps me is that I’ve read that once I pay one or two of the creditors I’ll be contacted by the others wanting their money, too. But I simply can’t pay them all at one time, not even if they were willing to take payments.

Should I wait until I have the money later this year then contact a few of the creditors and pay them in full? Should I disregard them and save the money? If I pay off a few will the others come after me?

What would YOU do?

Hi Jane, welcome to the group,. I think if your in a position where you have to find a place to live soon, I wouldn’t be paying any of that outstanding debt yet. When you get comfortable and move and living arrangements are all set, your income coming in is going fine and your paying your bills..

then I would continue to pay some of the debt.

Just curious how much debt total do you have and how many creditors do you have to pay? What I would do then is call each creditor and offer them half of what you owe and tell them this is all you have but you would be willing to pay it to settle with them. If it’s been a while since they have received any money, I bet they take it. Now the key is if they accept it you need to have it in writing and have them send you the debt settlement letter accepting the terms. Don’t give them any electronic access or personal information. All you need is to have it in writing and make a copy of it. CC companies will settle with people if they know at least they get paid something.

I think you have some leverage in this situation.

And if they don’t accept it, tell them thanks for their time and maybe call them back again a couple months later and try again. Just try to save up about half of what you owe and then start trying to settle with them. You’ll be surprised at what they will take. Thats what I would do…Its worth a shot to see what will happen and take care of the debt. Good luck!!!

I appreciate your input!

Our total debt is about $15,000 and nothing has been paid on any of it in several years. Again, part of that $15,000 is charge offs. As for how many creditors, hmmm, maybe 20 or 25. Most of the debts are small – there are just a lot of them.

You’re probably right that we need to concern ourselves with first things first then worry about the debt. Thanks for the information!

I can give a little input, this is what I’d do; once you are in a position to start paying on your debt.

  • Create a table or spreadsheet
  • list all your debtors/creditors accounts
  • list the date of first delinquency reported on each account
  • if you haven’t paid on some of the bills in close to 6-7 years, leave them alone. You don’t want to wake them up.

The newer ones you can write them a debt validation (or investigation) letter if they validate send them a payment plan letter, you can offer to pay as little as $5-10 per debt, whatever your budget allows.

others can tell you additional rules such as which ones to pay extra on by the amount of percentage, etc…

Getting out of debt