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vgordon

Guest
mississippi. we had a 13, 600.00 credit limit which we did not use all of it. for the past two years we have had serious medical problems that has put us in serious debt. we rote a letter to sears telling them that we wanted to cancel our card and the probelms that we were having and that for the next year we could only pay one hundred dollars per month. they don't want to work with us and now the bill is over 15,000.00. we managed to get some doctors paid off and now feel that we can give them 300.00 per month starting in april. they have our minimum payment at over 2000.00. we tried cccs but they could not help us and we tried to borrow the money from our credit union but could not. we only have 5 years left on our house and next year my husbands vehicle will be paid for which will give us extra money i don't want to file bankruptcy and sears is the only creditor who will not work with us. even cccs said they problems with sears. what can we do?
 
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Ladynred

Senior Member
Sears is a HUGE problem to work with .. nasty creditors all the way around. They used to strong-arm people filing for bankruptcy into reaffirmation agreements - until the Feds slapped them down for that practice and humbled them greatly.

If you don't pay their minimum, they will charge-off the account after 180 days of non-payment or insufficient payments, no way you can stop them from doing that. Your best bet is to continue to pay them what you can, as much as you can. If they won't even put you on a hardship program, which I hope you've asked for, then there's not a whole lot you can do. At least by continuing to pay them, it shows your good faith in wanting to pay.

The bad news is, once it gets charged off, Sears typically uses RMA as their collection agency of choice and RMA is very bad news indeed. Sadly enough though, once you have to deal with a CA, you actually have more rights than you do when dealing with Sears by itself. They're also more likely to accept a settlement offer after charge-off, which would work in your favor if you go about it the right way.
 
K

kevinss

Guest
Ladynred

Where can I find information on RMA? What can you tell me personally?
I'm dealing with them right now and they seem reasonable to date. I want to know what to expect or be aware of :)
 
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Ladynred

Senior Member
RMA is notorious for re-aging so watch your credit reports closely. If they're being 'reasonable' now, you must be paying them or their biding their time until they decide to turn the screws. At some point, they'll tell you that what you're paying isn't enough and they will demand payment in full NOW - then the threats start.

I, personally, have had no dealings with them (fortunately), but they've been harassing my fiance for months. He must have spoken to them at some point, because their latest messages are ' the least you could do is show me the courtesy of returning my call' and they make themselves sound like wounded 'friends'.
Yah.. right.. in your worst nightmares !!!

I would be careful of them and don't do ANYTHING w/o getting it in writing first.. and getting that will be a monumental task, I can assure you.
 
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Gobucs

Guest
I have also had a Sears account turned over to RMA. I started making payments to them over a year ago but couldn't keep it up and haven't made any payments in probably a year. I am trying to clean up my credit to buy a house and I only have three things to take care of - theirs being one. They have sent me settlement offers that amount to about 50 percent of the total owed. The lady I am working with to get a mortgage used to work in credit counseling and she is going to help me take care of this stuff. She said that as soon as I have a lump sum of money that we think they will accept she will call them and tell them she is my credit counselor and try to negotiate that they take the stuff off my credit report in exchange for payment.

I trust her experience but I am a little worried because I have read that sometimes when you negotiate a settlement, the creditor will sell the part that wasn't paid to someone else to try to collect and you are left with bad stuff on your credit report again and still owing more money.

Any advice about this situation and about RMA?
 

Ladynred

Senior Member
Yes. Whatever your 'couselor' negotiates, get it in writing and insist on a 1099-C. A 1099-C will totally CANCEL the debt and prevent any remaining balance from being sold. You may be liable for some taxes come 4/15, but its likely to be far less than what some CA would insist on later.
 
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kevinss

Guest
"I would be careful of them and don't do ANYTHING w/o getting it in writing first.. and getting that will be a monumental task, I can assure you."

Bingo. The nice lady on the phone said she would waive the interest and late fees. That was the first red flag - they shouldn't BE asessing interest or late fees on a collection account. I'll tackle that later. In the mean time, I made arrangements with her to send what I could when I could. She was more than happy to make the arrangement. I asked for her to send me the arrangement in writing.
I sent out a $25 check that day, not knowing any better at the time. I waited and waited... nothing came in writing. I put a stop-payment on the check and made a call to them to let them know I did that, and that I wouldn't be making any payments until they sent me an agreement in writing.
I'll actually send them something in writing when I have enough to do so. I don't even have the $4.40 I need to send a letter CRRR right now! Oh, the joys of unemployment.
 

Ladynred

Senior Member
Yes, I know.. been there, done that with the unemployment gig :(

Just as a further precaution, do NOT send these bottom-feeders a personal check or anything with your bank info on it. Send them a money order or cashiers check from any other bank but your own. If they get ahold of your account info, it could be dangerous - they are NOT to be trusted.
 
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Gobucs

Guest
Ladynred,
Thank you for the advice. I suppose a 1099-C is an IRS form that RMA would have to produce?

I don't think I fully understand what my mortgage broker is saying about getting this stuff off my credit report either. She makes it sound like we can negotiate a payoff and in return they will take the stuff off my credit and it will be like it was never there in the first place? Is this possible? Or is it more likely that they will unrate it so that it is a neutral item?

Also, how is unrating an item very helpful if the old history still shows up? Does unrating take away all those marks of 30 days late, etc?

You might be able to tell that I have been trying to research this stuff. I bought three different books on credit repair and I am learning but they don't go into enough detail about alot of this kind of stuff.

Another example is that one of my bad items is reported three different times - twice from the original creditor and then from the collection agency. I am assuming that when I pay that one we will pay it to the collection agency and then petition the credit reporting agencies to take the other items off. I read in one of the books that you can go back and negotiate with the original creditor and pay them - I guess they buy the thing back from the collection agency? How does that work and if it is a tactic are there any advantages to it? I would feel better about paying the original creditor rather than the collection agency, but only if it will help me in my final goal which is to clean up my credit.

I know I have touched on several things here - it is just such a complicated process and there seem to be alot of pitfalls and I don't want to mess up.
 

Ladynred

Senior Member
I suppose a 1099-C is an IRS form that RMA would have to produce?
Yes. A 1099-C is 'cancellation of debt income' and is reported with that year's taxes for any amount OVER $600 of 'forgiven' debt. I'm not sure if RMA can issue these or not, as I believe only financial institutions, credit unions, and the Federal gov't can issue them.

She makes it sound like we can negotiate a payoff and in return they will take the stuff off my credit and it will be like it was never there in the first place? Is this possible? Or is it more likely that they will unrate it so that it is a neutral item?
Its more likely that to get the mortgage approval, the debts must be showing as 'paid'. You CAN negotiate with the CA to delete in return for payment, but that only gets rid of the CA's entries, not the OC's. You can possibly negotiate with the OC for 'paid' or 'paid as agreed' at some point.

I read in one of the books that you can go back and negotiate with the original creditor and pay them - I guess they buy the thing back from the collection agency?
Usually not, especially if the original OC sold it some time ago. Once they charge it off, they usually won't even discuss it with you and refer you back to the CA - if they even know who it is at any point in time. Once they sell it, they basically wash their hands of it and usually don't even track it any more.
 

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