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My dilemma

June 1st, 2006 at 05:55 pm

As you all know I just found out my car has way too many leaks to fix therefore with in the next few months I should be looking for a new car. I decided the money that I was saving for a house and then change my mind, I was going to use the money to pay off debt...now I think I should use it towards a new car, well I have no choice. Any way
my credit score is terrible (615) I have two charge offs and no slow pays. I got an offer in the mail to pay off one of the charge off in order to settle the account, the original balance was $750.11 and the company is willing to accept $562.58 to settle (I did try to get this reduce, but was told no). My dilemma is should I pay off the debt and boost my credit score for a better interest rate when I decided to purchase a new car, but I'll be a short fund. However, in about a month with my part-time job I will be able to add the $500.00 back, or keep the money in case I need a down payment. I was thinking about going through my credit union, which I am sure will give me a better deal than the dealer. Right now I do not know how long my car will last but was told to just check the oils and drive it until it can't be driven any more. My sisters says pay off the debt boost my score and save even more for a down payment on a new car, especially since I’ll get two checks from my part-time job which will be equivalent to the $500.00…I just don’t know
lesson learn never live like the Jones otherwards never bite off more than yiu can chew. Don't cahrege things you do not need

Posted in Miscellaneous , , Auto | 6 Comments »

6 Responses to “My dilemma”

  1. carol Says:
    June 1st, 2006 at 07:58 pm 1149191931
    1149191931

    Question #1: The offer in the mail you received--is it from the original creditor? This is important, because if not, then you are most likely dealing with what I label bottom feeder collection agencies. www.budhibbs.com is where I strongly advise you to go, and get a real eye opening education. This website has a list from A-Z of every bottom feeder collection agency out there. If it's from a collection agency, DON'T pay them one red cent. Contact the Federal Trade Commission, and/or your state attorney general's office.

    If, on the other hand, it's from the original creditor, try to negotiate with them about paying off, and boosting your credit score.

    Good luck and let me know how things turn out.

  2. veronak Says:
    June 1st, 2006 at 09:49 pm 1149198577
    1149198577

    No the offer was not from the original creditor , if the company is not on this list do you think I should pay. I have paid off a debt once before through a CA with no problems but now I am nervous

  3. MsSuperSaver Says:
    June 2nd, 2006 at 12:23 am 1149207831
    1149207831

    As long as your car is still running I would say pay off the debt first. Otherwise you will have given the car company a nice down payment but then have both a new car payment and a debt payment to make each month . A plan: #1--pay off debt, #2--save for a few more months so you will have a good down payment, #3--buy a good used car (from a reputable dealer not one of those "we'll finance you even if you have the crappiest credit on the plant" places), then #4--sell the old car for whatever you can get for it and put that towards your car bill. Good luck and post a pix of the car when you get it!

  4. carol Says:
    June 2nd, 2006 at 12:44 am 1149209091
    1149209091

    MsSuperSaver has some very good ideas, but even if the CA is not on the list does not mean it is a legitimate CA. If there are names of other CA's listed anywhere on that letter, still check them all against the list of CA's at the website I mentioned.

    Try to get validation on this debt from the original creditor and from this CA. If they are legit, they will be willing to work with you. If they are not, they most likely will start to hem and haw, etc. Try to find out how they got this debt. Then look up the debt statute of limitations in your state.

    If it comes right down to it, and you have to pay this amount, then do so, but follow up and get it removed from your credit report. That is vital.

  5. Bibliobird Says:
    June 2nd, 2006 at 01:56 am 1149213381
    1149213381

    Looking at NEW cars might be worthwhile. In the news today, Ford is going to 0% financing. AND giving $1000 gas credit. That would give you secure, maintenance free driving for a long time and you could pay debt during that time. Be sure to compare what you're really paying for the used car including the interest. 0% might make up the depreciation and you'll enjoy it and it will still be nice years from now. Other car brands will be offering 0% loans to compete.

  6. veronak Says:
    June 2nd, 2006 at 02:32 am 1149215571
    1149215571

    Thanks guys I will definately check out the CA and try and hold on to my old car as long as I can..boy I hope it gives me atleast another 2-4 months that way I acan sock away and pay down debt. I really want to try and get this car on my own vs a co-signer, I'll keep you guys posted

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