Expert: Kathleen Eads - 6/25/2006

Question
3 years ago my ex-husbands accounts showed up on my crdit report, therfore my on personal credit card raised its apr to 23%. i had never been in default with them.they have wrote the account off as a bad debt. it has been sold 5 times to different collectors, the most recent said they would take my income tax refund i offered 25.00 per month to start, they refused, said i'd have to send 50.00 and told me if my kids were old enough to work they needed to get a job and i needed to get a 2nd job, because they would collect. i had already offered the credit card company 100.00 per month when this first happened, they refused, said they needed more, what can i do now if i want to try to resolve this. i am a single parent with two kids on a fixed income. the credit bureaus have now removed all of my exs accounts off my credit reports.

Answer
tamila,

I'm a little confused.  Your APR went to 23% and they wrote off the account?  But then you say you didn't default.  

I'm assuming it's because you defaulted that it's been sold and placed for collections.  The first question is, how much do you owe?  If you owe over $1,000, at $25/month, it would take you 40 months or nearly 4 years to pay this off.  This is why they have denied your payment offer.  The longer it takes you to pay it, the more money it costs the agency in monitoring etc. Also, the more you owe, the more likely the agency is to take the matter to court (if it's "suit worthy".)

I do not agree with the fact they said your kids should work or you should pick up a 2nd job.  They don't walk in your shoes, and telling you how to run your life is NOT their job.  Their only concern should be your debt in question.  I would keep concise notes of the calls (dates, names, times etc) and report these kind of calls to a supervisor at the agency handling the account.  

You may want to try applying for a loan to pay this off with.  If you get it, the agency is paid off and your smaller payment schedule is between you & your bank.  If the bank denies you a loan, they are required by law to send written notification of the denial.  Provide this to the agency to let them know it's best if they work out a payment schedule with you.  

I'm not sure they can touch an income tax refund, and you may want to speak to an attorney about their attempts to do so.  I do wonder though, if you got a larger refund, why not pay them off and put this matter to bed?  

I would suggest working out an amicable payment schedule that all parties agree on.  Make sure you agree to payments you KNOW you can make.  The worst thing in the world is to agree to a payment schedule and default on that too.  

Hope you get it worked out,
Kathleen Crabtree-Eads