I have heard great success stories from people that have used debt consolidation companies and am wondering if that is my best method…
I owe thousands in various hosptial debts and many of these have been sold to other colletion agencys and I couldn’t begin to tell you how much I owe everyone. I have 0 in credit card debt, so I am not trying to get out of my responsibilities, I only want to see a light at the end of a very dark tunnel. Anyone have any recomendations of any or if I should proceed another way? I am in Indiana if it matters (I know some companies only work in certain states).
I beleive a debt consolidation company would charge interest, I beleive a collection agency can collect only the balance reported to them. If this is all true (and I admit, I could be mistaken) your best bet would be to keep it as is. Remember, no matter what you do, you won’t owe less, but you could wind up owing more.*
*I could be wrong, this is just my understanding.
ETA if you REALLY want to consolidate so you know what you owe and for how much longer (though a list of the balances and payments from each statement and a few phone calls would do this) and you are willing to pay the interest to do it, you’d be better off just paying them all with one of your credit cards, the one with the lowest rate.
EETA, you’ll have to see if that’s possible in your state, in Wisconsin you can’t pay off something in collections with a credit card. I’m not sure if you can consolidate it.
My personal experience: I had about 5 debts from various credit cards (some of which had gone to collections) adding up to about $13k total. I went with Cambridge Brighton. They told me base don the payment schedule it should take about 5 years. They charged about $30 a month for the service. I trusted them, naively, I should have kept better track of things on my own. First warning sign - the statements they send tell you how much you have paid but they don’t have a remaining balance. When I finally thought to ask, they said you have to contact the creditor directly. That’s when I got a shock! The ones that were going to the credit cards directly had gone down and were almost done, but the ones that were being paid to collection agencies hadn’t gone down at all. Apparently they were charging interest, so all the payments I had made were going to interest and not principle. Of course, Cambridge had never bothered to inform me that this could happen or that it was indeed happening. I’m really not sure what my recourse is. As soon as I found out, I stopped the service. But I’m not sure if there is a way to force the creditors to accept what I paid as complete since I never agreed to any interest with them obviously. That said, there probably are good companies out there. But be careful and do research, and get recommendations. Make sure they explicitly state if there are any additional charges like a service fee or interest, and pin down the exact date you will be paid off.
Somewhere buried in something you signed it probably said that the payment due was an interest only payment and therefore to make headway on the debt you would have to pay the minimum due plus extra to put towards the principal.
Thank you all for the quick reply. I am talking about $80k + in medical debt. Several procedures and no insurance. My biggest issue is that my credit is screwed and every time I start chipping away at one dun, it gets “sold” to another collection agency and I end up having to negotiate all over again. I keep trying to get a leg up and then it gets swept out from under me again.
Do you, by any chance, own a house that you can borrow against? OTOH, I don’t like the idea of securing currently unsecured debt. You might want to go and talk to a bank or credit union. They might be willing to help you. As long as you have the income to make the payments that might be your best bet, not only that, but it will help you to start rebuilding your credit.
The company I work for specializes in managing accounts receivables for Hospitals (money owed to hospitals). Before anyone yells at me, it is NOT a collection agency. Our people examine the books and help them determine what to write off, what to send to collections - sometimes help them find a collection agency, and help collection efforts on accounts that are not yet in collections.
I am an IT guy, not a debt expert or a lawyer, but I have picked up some knowledge along the way. I would recommend talking to the hospital and seeing if they can take the debt back from collections. If they can, you want to work with the hospital rather than a collection agency.
Hospitals write off a lot of accounts all the time. You can see if they will accept a lesser amount as payment in full.
See if you can be put on a payment plan with the hospital. As long as you are keeping current with your payment plan, your debt is not likely to be sent to collections.
Is the 80k all owed to the hospital? Usually you will owe the hospital money, as well as the Surgeons, and perhaps other people. These are almost always billed separately. If so, you may need to contact each group separately.
Again - Not a lawyer, not a debt specialist. IT guy. Take my advice at your own risk.
I’ll have to take a look, but the only things I would have signed are 1) the original contract with the credit card agency and 2) my agreement with the consolidator. As far as I can tell, the only thing the consolidator does is send some sort of payment proposal to my various debtors, and then collect money from me every month, $30 of which it keeps for itself and the rest which it sends to the various debtors. The problem I have is not with the credit cards - those have been getting paid off. It’s the debt collection agencies who got sold some of my debt. They are charging interest. Obviously at no time did I sign any kind of papers with them. Can they inherit an interest rate from the company that sold them the debt?
Ohhh, I get it now, I mis-understood a sentence in your post. Call the collection agency that holds the debts you are concerned about and ask for proof of the debt. My understanding of collection agancies is that they can only collect what you originally owe. Though they may do a lot of kniving, lying, cheating and stealing, all they can legally collect is what you owe on day one. You’re probably going to need to do some work to get out of this. I would start by reading up on fair debt collecting practices, call them and ask for proof of what you owe, and then call Cambridge Brighton* and find out how many dollars have been paid towards each debt. You should only owe your original debt less what has been paid towards them. You might need to report the collection agencys to ummm whomever you report them to to get your way, be prepared to fight with them.
*Remember, you’re beef isn’t with Cambridge (I don’t think), no matter how frustrated you are, don’t get mad at them, you want them on your side, you don’t need them to feel like they need to be defensive about something.