Debt collector is chasing me...

[ausnick87]

Ok, so back in 08' I racked up a 6k credit card debt with ANZ... it was entirely my own fault.

Anyways, I was overseas for about 9 months, during this time I didn't contact ANZ and by the time I did call them to discuss the debt it had already been sold to Baycorp... 4 years later I get a call from Baycorp who are demanding I pay this debt (which is now 7.5k @ 9% interest).

I tell them the truth, I'm currently a full-time uni student who's also enrolled in tafe...living off centrelink benefits. I can barely afford to make ends meet at present let alone pay off this debt, but what can I do?

They told me to ask my friends/family for a loan... when I said that's not an option she threatened to take legal action against me... Argh !

I know I'm an idiot for digging myself into this hole but would appreciate any advice...

 

[tech/a]

Ok, so back in 08' I racked up a 6k credit card debt with ANZ... it was entirely my own fault.

Anyways, I was overseas for about 9 months, during this time I didn't contact ANZ and by the time I did call them to discuss the debt it had already been sold to Baycorp... 4 years later I get a call from Baycorp who are demanding I pay this debt (which is now 7.5k @ 11% interest).

I tell them the truth, I'm currently a full-time uni student who's also enrolled in tafe...living off centrelink benefits. I can barely afford to make ends meet at present let alone pay off this debt, but what can I do?

They told me to ask my friends/family for a loan... when I said that's not an option she threatened to take legal action... Argh !

I know I'm an idiot for digging myself into this hole but would appreciate any advice...

Firstly don't stress
Baycorp have the problem ( they need to get their 7.5k out of you)

Give them a written offer of $ 10/ week or whatever you can afford.
If they don't accept then let them take you to court.
Arm yourself with your financial situation in a concise easy to read report and submit to the magistrate.
Suggest that you can afford x / week.

Truth is if you stop paying they have to take you back to court to enforce resumption of payments--- of course you would present your case that the "x" you were paying was too much fir you to handle so perhaps the same amount each month?.

Or

You could find some $$s somewhere and offer of say $1500 as full and final payment as it's someone else's money you'll have to arrange a weekly payment--- obviously
If they don't accept then do as suggested above.

Unfortunately the law isn't able to get blood out of a stone.
I've been to court with many stones!

 

[inq]

Suffer the consequences.

Cut back on Tafe/Uni, get a job, pay off your debt. If you don't want to cut back on either, start getting used to 4 hours sleep a night.

If you think this is inconvenient to you, harden up. You made mistakes, were inconvenient to ANZ etc.

Time to take responsibility and do what you need to do, otherwise your credit score will be raped which can mean negative consequences in the future.

 

[tech/a]

Time to take responsibility and do what you need to do, otherwise your credit score will be raped which can mean negative consequences in the future.

Already stuffed I'd say

 

[LostMyShirt]

I hope you're prepped for a bad credit rating. You CAN go bankrupt as a LAST RESORT!

I recently just got out of insolvency of 35K, by making a written offer to ITSA of 13K. If they didn't accept we threatened to remain insolvent until the pre-designated release date. Needless to say, they took the offer.

There is no harm in harsh negotiations. They need money our of you, so try to control the situation.

 

[sptrawler]

Spot on answer tech/a.

 

[Tyler Durden]

Firstly don't stress
Baycorp have the problem ( they need to get their 7.5k out of you)

lol, I love the way you put that

Suffer the consequences.

Cut back on Tafe/Uni, get a job, pay off your debt. If you don't want to cut back on either, start getting used to 4 hours sleep a night.

If you think this is inconvenient to you, harden up. You made mistakes, were inconvenient to ANZ etc.

Time to take responsibility and do what you need to do, otherwise your credit score will be raped which can mean negative consequences in the future.

On a moral point of view I'd agree, but I suppose it's good to consider other options.

I know his credit rating may be stuffed, but how about getting a credit card and doing a balance transfer with 0% interest for 6 months? If that doesn't work, I'd seriously consider asking friends for a loan of $3000-4000 to pay off Baycorp and then paying off friends slowly.

 

[tech/a]

lol, I love the way you put that



On a moral point of view I'd agree, but I suppose it's good to consider other options.

I know his credit rating may be stuffed, but how about getting a credit card and doing a balance transfer with 0% interest for 6 months? If that doesn't work, I'd seriously consider asking friends for a loan of $3000-4000 to pay off Baycorp and then paying off friends slowly.

Whatever you negotiate with Baycorp
Make sure clearing your credit record is included.
Get EVERYTHING in writing.

 

[Julia]

I know his credit rating may be stuffed, but how about getting a credit card and doing a balance transfer with 0% interest for 6 months? If that doesn't work, I'd seriously consider asking friends for a loan of $3000-4000 to pay off Baycorp and then paying off friends slowly.

That's the last thing the OP should be doing IMO. Never involve friends in either borrowing or lending.

Apart from the almost inevitable eventual falling out over such an arrangement, why on earth should any friend feel obliged to help someone who has ignored his responsibilities?

As already suggested, accept the reality that the debt belongs to you and make some arrangements to pay it off over however many years it takes.

 

[Starcraftmazter]

I know his credit rating may be stuffed, but how about getting a credit card and doing a balance transfer with 0% interest for 6 months?

It's a bit hard (or damn well near impossible) to get any sort of credit as a student on centrelink, and certainly not for 7.5k. Otherwise that would be a pretty sweet idea, just rinse and repeat every 6 months until you can pay the debt

Perhaps if you have anything worth 10k or so to offer as collateral...

 

[burglar]

There is no way that Baycorp paid $6000 to ANZ to take over your debt.


So morally, I may agree with the talking Duck!!

On the other hand, you'll want to sleep at night, so do what's right!

 

[Junior]

Suffer the consequences.

Cut back on Tafe/Uni, get a job, pay off your debt. If you don't want to cut back on either, start getting used to 4 hours sleep a night.

If you think this is inconvenient to you, harden up. You made mistakes, were inconvenient to ANZ etc.

Time to take responsibility and do what you need to do, otherwise your credit score will be raped which can mean negative consequences in the future.

Strongly disagree with the above.

Strongly agree with tech/a's suggestions.

You're dealing with a multi-billion dollar faceless organisation. They have no morals, so you should have no morals dealing with them, it's strictly business and negotiating the best possible outcome for yourself.

Clear the debt as cheaply as possible, whilst trying to keep your credit rating under control.

In the meantime continue and complete your studies. Your credit rating will repair over time, but it's best to avoid a part X or bankruptcy if possible....especially for a relatively insignificant amount of money.

 

[suhm]

While personally I believe that you should pay off your debt, you racked it up so it is your responsibility I don't think you should be leaving your training to do so. It is always difficult to start again.

Baycorp bought your debt for cents in the dollar, not sure of the exact rate they pay but the carrying value of CCP PDLs is 136.6m with a face value of $3.3bn, different debt types cost different amounts but it cost them about 4-5c in the dollar for your debt.

Contact Baycorp and negotiate a payment arrangement, it saves them costs as they don't need to harass you for the debt and it is still profitable for them even if they don't collect the full amount.

Some moron lived in my apartment previously and has a debt which Baycorp is trying to collect and I keep getting letters from baycorp to chase up his debt, I probably should contact them but I throw the letters away instead.

If the debt is small they usually give up after awhile and your credit score would already be cactus but if you want to have credit in the future doing the right thing now would count.

What you end up doing is up to you but it is how we act when other people are not around to see which shows the quality of the man.

 

[pilots]

There is no way that Baycorp paid $6000 to ANZ to take over your debt.


So morally, I may agree with the talking Duck!!

On the other hand, you'll want to sleep at night, so do what's right!

I have a friend working for a debt collector, they charge 15 to 20% of all they can collect, the bank gives the bad debts to the collectors and hopes for the best.

 

[ausnick87]

Thanks for the replies everyone. They have been helpful.

I might try and threaten the debt collector with bankruptcy and see if the 7.5k debt could be be paid off $1500... would that demand be realistic do you think?

 

[matthewdean]

Thanks for the replies everyone. They have been helpful.

I might try and threaten the debt collector with bankruptcy and see if the 7.5k debt could be be paid off $1500... would that demand be realistic do you think?

Let us know how you get along...

Google the Straw man theory for absolute desperate measures, I've only ever touched on the surface of it but I’ve read of some similar situations to your own.

 

[Bonk]

I used to be a debt collect administrator with the big boy in town . No need to threaten anything . Just talk ,talk ,talk ..... and get advice from organizations around [social] . The goal for you is to get rid of the debt as it will haunt you for the rest of time . When you go to do anything in life it pops up and you have a problem . If you fail to respond over time the bailiff will seek you out and the result could be misery.

 

[Calliope]

It is strange that inq is the only one to suggest that you get a job and pay your debts. This would benefit you and the taxpayer. You won't be missed at the Uni or TAFE where you are probably only doing Mickey Mouse courses anyway.

 

[Chasero]

Suffer the consequences.

Cut back on Tafe/Uni, get a job, pay off your debt. If you don't want to cut back on either, start getting used to 4 hours sleep a night.

If you think this is inconvenient to you, harden up. You made mistakes, were inconvenient to ANZ etc.

Time to take responsibility and do what you need to do, otherwise your credit score will be raped which can mean negative consequences in the future.

I actually agree with ^

If your family can't give you a loan, I'd try to fit in part time work with full time uni/tafe.

If you can't, I'd suggest maybe taking next semester off to work to try and pay off the debt. (unless you are nearly finished your course)

How far are you from looking for work? e.g. if this is your last yr, I strongly suggest you start job hunting anyway.

 

[Knobby22]

Come on guys, the debt collector gets the loan for a cut rate, the bank has already written it off and on sold it.

There is great advice on this thread but leaving uni to get a job to pay off a debt is not good advice. As many have said, try and come to an arrangement. They would prefer part of the money now rather than long term so maybe you can strike a deal and pay off your Dad over time.

Don't worry about "the taxpayer". Your tiny amount will hardly effect the amount of tax payed by the debt collector.