Credit Card Woes - Conclusion

I have been receiving numerous comments and questions regarding my previous posts on Credit Card Woes. Some of them I replied to, some I left out to the readers to find out for themselves, given time. What I've noticed though; some questions can be answered by the questioner if he simply reads the entire Credit Card Woes series thoroughly, especially my replies to some of the readers' queries right below the article.

To all those who sent questions dated way back like 2006 and 2007, if you're reading this, then you probably know the answer to your question already.
Maybe you still have credit card debt, still can't pay, or you're slowly paying up. But definitely, you ain't in jail, and you're probably in some internet cafe sipping ice coffee or maybe at home in front of your pc. If this is not the case, and you're wearing an orange pajama and shirt with a big P on the back, then by all means, TELL US WHAT THE HELL HAPPENED!?!

Anyway, I felt the need to sum this series up as I probably can't answer all your questions. So I leave you with 4 points to remember when you feel the pinch, so you could function again, and live your one life out of that hole which circumstance, or you, have dug yourself into.

1.) Relax - hard to do if you're way down deep in credit card debt, but very important. It may be small comfort to know that tens of thousands of Filipinos are in the same boat as you are. Knowing that millions die of cancer each year does not make it any less stressful if you have it. Still, it does no good if you dwell on it. There are better things to do.

2.) Pay When Able - don't pay if it means selling your last pair of shoes, and ignore all demands asking you to do so. Pay when you're ready to pay. But don't be so eager that you go seek them out and sign the first promissory note from some lawyer office you see. Wait it out. The best deal and the opportunity to pay will present itself to you sooner or later.

3.) Move On - yes you can get that NBI clearance, you can open that bank account, you can get a passport, go anywhere you like, or apply for a job abroad. No one can take your right to life, liberty and the pursuit of happiness because of credit card debt. Besides, how would you be able to pay if they stop you from living your life?

4.) Stop The Cycle - got a shiny and flashy new card but still have debt? Don't even think about it.


----------
Related: Credit Card Woes - The Call, The Letter, The Visit


Next Post - GMA Ouster - One Missed Call

Credit Card Woes - The Visit

After battling your way through those irritating phone calls and reading those heart-pounding letters sent your way by the mighty credit card collection agency, we now come to one of their more effective collection strategy. The home or office visit.

By showing up in a place where you feel most safe and secure, they hope that they’d be able to shake your steely resolve with one thing that frightens us all – public humiliation. So, they come out in a van with screaming bold letters on the side exclaiming – DEBT COLLECTORS – much like those pest exterminator vans you see around.

How to fight it? There’s only one thing you can do. And that’s to just grin and bear it. Because even if you can complain in court for harassment, there’s no way you can undo that day when they came. But there are a lot more Don’ts.

Don’t get scared. That’s what they’re hoping you’d do.
Don’t let them in. You can talk to them outside. Unless they have a court order which I doubt. If you’re in the office, tell the receptionist or the building guards not to let them in the next time.
Don’t let them pressure you into signing anything.
Don’t take their insults personally, they're just doing their job the best way they know how. So ignore the drama and you might even find it amusing.
Don't agree to anything immediately. Just get the details and tell them to give you time to think or consult a lawyer about it.
And finally, don’t stop your big dog from barking.



Related: Credit Card Woes - The Call, The Letter, Conclusion


Next post -> God Our Dad

Credit Card Woes - The Letter

Now that you’ve figured out how to deal with that credit card collector on the phone, expect them to start pushing up the ante. The battle has now been joined, and they’re now ready to unleash one of the most effective weapons in their arsenal, The Demand Letter. Just one of these if received unprepared - especially the first time - is enough to bring a grown man down to his knees in surrender. So let’s gear-up and find out if there’s a reason to fret about this threat.

Most credit card demand letters come in two types.

One is the pretty straight-forward type, specifying how much you owe, a reminder of the contents of the credit agreement, plus a bonus threat regarding what action they’re gonna take against you.

The other kind of letter is more indirect in its approach but nonetheless more potent. It is formatted to look like an official civil/criminal Complaint ready to be filed - or to the impression of some - already filed in the appropriate Trial Court. No wonder people who are uninformed and unfortunate enough to get one of these would seriously contemplate on how much painful it would be if they were to jump off a building.

So before you jump, allow this to sink in: You’re not in trouble, it’s just your impression. So CHILL! (repeat as needed)

Let’s look at excerpts of a sample Credit Card Company Demand for Payment:

Dear {Your Name}:

Our client, {Your Credit Card} has referred to us for appropriate legal action your total unpaid account of {Your Debt Amount} as of {Date} representing purchases and usages made thru your above-stated Card, inclusive of finance and penalty charges, as well as collection fee.

Under the terms and conditions of the Card member’s Agreement, {they now quote the small print at the back of the credit card agreement you so happily and excitedly signed a couple of months or years ago}

Despite repeated demands, you failed to pay your said account, hence, we are formally serving this DEMAND for you to pay in full your said unpaid account, including all charges within FIVE (5) DAYS from receipt hereof. Otherwise, we would be constrained to CRIMINALLY PROSECUTE YOU for Violation of R.A. 8484 (Defrauding of Creditors) if the evidences warrant and/or CIVILLY CHARGE YOU, for Collection of Sum of Money with Prayer for Attachment, before the (Regional or Metropolitan) Trial Court of {City}, in order that you may be penalized with imprisonment including the recovery of litigation expenses and judicial cost, as applicable, and twenty five (25%) percent attorney’s fees, without further notice and delay.

Please consider this as our LAST and FINAL DEMAND.


Scared you the first time right? Now let’s take it apart!


1.) They’re demanding that you pay in full within 5 days?! - Ridiculous! If you don’t have money, you don’t have to pay. Why? Because you can’t! No need to borrow from anybody. It will just get you deeper into debt.

2.) Their asking you to pay in full the principal plus the charges which continuously accumulates every month! - Again, Ridiculous! You weren’t able to pay last month’s balance so how could you pay for it now when it’s higher than last month’s? I’d love to see them jack it up into the millions and let’s see if they’d be able to collect anything by then.

3.) Criminally prosecute you for Violation of R.A. 8484 – now don’t focus on this sentence, focus on the next – if the evidences warrant. Now that’s a big IF!

- So what kind of evidence would warrant a violation of R.A. 8484? Let us quote:

“A cardholder who abandons or surreptitiously leaves the place of employment, business or residence stated in his application or credit card, without informing the credit card company of the place where he could actually be found, if at the time of such abandonment or surreptitious leaving, the outstanding and unpaid balance is past due for at least ninety (90) days and is more than Ten thousand pesos (P10,000.00), shall be prima facie presumed to have used his credit card with intent to defraud.”

Ergo you're off the hook!

Why?

How?

Because you're holding that letter. Which means you could actually be found. And as for you not informing them, - the fact that you're holding that letter is the best evidence that you did inform them, - if you did move. Let them prove otherwise.

- Is that paragraph all that R.A. 8484 contains?

NO - but that paragraph is all that could possibly apply to you! The rest is all about credit cards (and other devices which they call access devices) fraudulently obtained. Like if you used a fictitious name to obtain the card, or you used a stolen card. But if you did all that, I don't think getting a demand letter is what you'd be worried about.

So the fact is, a demand letter works to your advantage. It has your name on it. It says that you were honest and upfront when you obtained that card, but unfortunately you can't afford to pay right now.

If you really had any intent to defraud, do they think you'd be stupid enough to have used your mother's house as the billing address?!

4.) Civilly charge you for Collection of Sum of Money with Prayer for Attachment – They can but they won’t. Why? It would cost them more than the amount you owe. And the most likely result would be a settlement. With you paying maybe less than what they’re asking for. But do you know what’s really stopping them? BAD PUBLICITY.

5.) Consider this as our Last and Final Demand – Well, I have a friend who has a box full of these.

OK! But what should I do when I do get one of these?! – Get a big box.

Related: Credit Card Woes - The Call, The Visit, Conclusion

Next… THE VISIT

Credit Card Woes - The Call

So now after a couple of years in Just-swipe-it Heaven, you find yourself in Barely-scraped-through-minimum-payment Purgatory heading towards Tell-them-I’m-not-here Hell!

For those of you who are inevitably plummeting down credit card debt hell, let me soften-up your landing a bit. And for those already wailing and gnashing their teeth from debt heat, let me ease your suffering a bit with a bucket of ice water.

That’s right folks, there is hope and respite from your credit card woes. But no, I’m not gonna help you pay. All I’m going to do is enlighten you a bit with regards to your situation.

Pop Quiz: You’re receiving maddening calls from seemingly very angry people calling you names, looking for you wherever you are, asking you to pay up.

What to do hotshot: Take the call if you can’t avoid it. Relax, take a deep breath, and sit down comfortably. Answer with a simple yes or no. No need to explain yourself, they’re not there to listen to you whine, they just want your money.
Now most of them will come on to you like mafia dons, shaming you with your inability to pay, threatening that they’re coming to get you and that slab of flesh from your behind.

Well, that’s what they think!

When that guy on the phone starts to raise his voice, just tell him this: "Mister, stop play-acting. I don’t owe you any money, you’re just a poor employee collector agent whatever, so don’t act as if it’s your money I owe."

Now that he has realized you’ve caught him in his act - (yup, that’s all it is, just an act, so relax!) -he can’t possibly get on with it anymore. Whatever he says afterwards will sound flat to you and to him too, like you’re hearing an old joke. Besides, he can’t really be mad, he’ll probably get a commission when he collects from you.

Some of these credit card collectors may try to harass and put you in embarassing situations and even if you're able to put them in their place, you find that the damage has already been done. Well, just grin and bear it, but I'll tell you this: It's just a phase. It will pass.

But what if the caller sounds like an angel from up high? Gently reminding you that you need to pay up or else...

He’s playing the good cop act then so just ignore the ‘or else’ stuff too. But this would be a good time to work-up a deal, just make sure it’s on your terms. Tell him how much you can comfortably pay in a month. If he relents, fine, but if not, you can go hang-up that phone. Don’t worry, he’ll call back. And be it good cop or bad cop, you’re gonna be ready.


----------
Related: The Letter, The Visit, Conclusion


Next… THE LETTER