I stopped paying on my Bank of America gold loan of 30k balance

[blecah1977]

Any advice or ideas on my situation please...

Hello,
About one year I stopped paying on my Bank of America gold loan of 30k balance. I simply got in over my head and could not afford the payments, much less the amount it would take to crawl my way out of debt. Ofcourse losing my job only compounded my problem. I expected to be sued right away because the amount of debt is so large, I am young and able bodied, and I live in the relatively good economic climate of San Francisco (as opposed to somewhere like Michigan). Oddly enough, I have not been sued yet and it has surprising how little Bank of America actually attempted to call me or write me a letter. I have not communicated to them at all in one year.

Just the other day I received a letter from Professional Recovery Services out of New jersey saying that I have one month to contact them to make payment arrangements or they will get a judgement. How realistic is this? I know they can't just get a judgement and potentially garnish my wages without first serving me and taking me to court, actually showing, and winning before the judge can issue the judgment and therefore the right to garnish wages.

Does this sound like a bluff?
How likely am I to get sued when it hasn't happened for a year?
Is it likely to just be sold to another collector 6 months down the road with the same threats?

I could care less about my credit and a judgement on my record, I just don't want to go through the hassle of having my wages garnished and losing 25% of each paycheck (I have a new job now, albeit at significantly lower wage than previously). My plan was to simply wait and see if I get sued and if I did, just file chapter 7. (I already met an attorney and found out I qualify). But the fact that I haven't been sued or really contacted gave me the impression I might somehow not have to deal with this and eventually after 48 months they cannot even sue me and eventually after 7 years it would fall off my credit report. Also, I have not used any credit cards since this went down a year ago.

Any thoughts or ideas are appreciated. Thanks
Brad

It's never a wise idea to assume you will have no need for good credit in the near future. You should care about whether this affects your credit. It surely already has if you haven't paid on this debt in a year. It's probable that if you pulled your credit report, your score has taken a severe nosedive.

Yes, they can sue after a year. Any collection agency can sue anytime before the Statute of Limitations runs out in that state.

The "hassle" of having your wages garnished? You owe the debt. They will collect any way they can. You agreed to the terms. It's a contract. You breached that. So they have every right to "hassle" you by garnishing your wages and placing liens on any property you may own.

You would be losing a percentage of your wages anyway if you were still paying it would you not? What's the difference?

In this economy, good credit is more essential than ever. You never know what the future brings. You might need credit a year from now. Nobody really has any idea what's going to happen down the road.

Yes, the collection agency is lying to intimidate you into paying it, but they do have the right to sue you in court and get a judgment. Regardless of whether you respond to them directly or not (I'd advise not), they will likely pursue it given the large balance they can potentially be awarded.

The Statute of Limitations won't expire for 3 more years in your state.

Yes, it's likely to be sold and resold and can quite literally haunt you forever. But once the Statute of Limitations runs out, no collection agency can legally sue you.

If you file for bankruptcy, your credit will be just as tarnished - if not more so. Bankruptcy's remain on a consumer's credit report for 10 years.

I'm curious though, why you're here looking for advice on this matter when you've already consulted with an attorney.

Contact the consumer financial protection bureau. File a report online about the loan. It's predatory and that's why you can't pay it. It was sold as a loan but turns out it's a line of credit but they report it as credit card on most peoples credit reports.

Does the payment go down every month? NO ! That's because it's a fixed rate loan..which is how it's sold. Try getting BOFA to give you the originator of the loan in WRITING. They won't. They won't even do that for the government. They will tell you that the loan is too old and they don't have that information. But they have it over the phone, just not in writing?

[Friend In Court]

By now this man has been sued by the firm BofA sold the delinquent account to. And probably obtained judgment against him.

When one is faced with suit for debts, such as this credit card account, there are few defenses one can make that stand up in court. However, defenses must be lodged, and credible ones to avoid a judgment called summary -- no dispute as to fact--and then their wages, bank account and other properties attached.

When one is faced with a debt problem like this it is best to be represented by an attorney for the attorney can often negotiate an agreed settlement amount for far less than what is being sued for.

These "asset recovery" services buy delinquent accounts like this often for pennies on the dollar. The banks write them off as bad debt, sell the accounts, and if the firm to which the case is assigned is usually amenable to settling for less than the face amount -- for they got it for precious little.