Update on CitiBank

Just wanted to give you the update, actually the resolution, of my Citibank (link) experience. I called the attorney for CB and told him that while I appreciated his offer, I couldn’t afford the monthly amount CB requested. I told him I could pay X amount per month for 48 months and that was the best I could do. He called back this morning and told me he had presented the offer to CB and they had accepted it and he would forward the appropriate paperwork to me. He is also going to file the agreement w/ the court so we don’t have to attend the hearing this week and there won’t be a verdict filed against me. All in all, I think it is a good, fair result. Hope it gives you some hope! LMK if you need or want any more details on the situation.

Hi, my name is Alex. I am 32 years old, and I need to make some changes.

I started into credit cards when I was in college. At one point, I paid them all off and cancelled them down to one. I was so proud of myself. Later, I started my own business (animal photography), and I got into credit again. I bought my computer with a store card. I knew at the time that the trick was to pay it off completely or get slammed with huge interest. I was sure I could do it okay, but I didn’t stick to my plan.

I also got some credit cards again and maxed them out, then I did the worst part. I accepted a loan offer for $2500. I knew the interest was outrageously high, but the offer came 3 months before my first big vendor booth at a hige show in Reno (I live in Washington). I was very confident, and I expected to have huge sales, if only I had enough product to sell at the show. So, I took the loan and used the money to buy supplies for the products. I was sure that I was going to have at least $5000 in sales, probably much higher than that. I figured it was a good risk, and I could pay off the loan *and* all my credit cards after the show. I thought I was on my way to being dept free. How wrong I was. The show was smaller than I expected with very little promotion. And the vendor booths were closed for teh evening, when the largest group of spectators was there.

I think I came home with $600 after paying fees and travel costs. That was in 2000. I managed to make payments and keep up with all my minimums until the spring of 2003. I had two huge vet bills, one right after the other. At that point, I missed a few payments, and that meant late fees, overlimit fees, and then the new minimum due is 3 or more times the regular payments. And that means additional late and overlimit fees, and suddenly, every bill is way overdue, and I can’t possibly pay them all.

I’m sure many of you have been or are going through the same thing. I am very happy to say that my phone, internet, and union dues are all current now, and I completely paid off my smallest card. I have payment plans on 3 of my bills, regular payments on one credit card, and I have 3 more to get under control. Until this month, I was at risk for going on strike at work (contract expired May 5th and we got the new one a couple weeks ago), so I spent a couple months stocking up on food and supplies just in case. I was also relunctant to start any new payment plans since they all want automatic payments instead of me mailing in checks. Not good if my income stops. Now that the strike risk is over, I have plenty of food to eat, and I can concentrate on paying bills.

I’ve been looking into options, and I am currently trying to see if I can get a loan with my credit union to pay off at least the 3 remaining problem bills, more if possible. I figured out that a loan for $9000 would mean monthly payments of $277, which I would have no problem doing if the 3 bills were removed. If I accept the lower payoff amounts, I could possibly eliminate 5 or 6 of the bills.

I have read that accepting the payoff amounts will hurt credit reports, but seeing that all of my bills have been late for over a year now, I’m not sure that my credit report could go much lower. Also, most of the balance on these bills has been late fees, overlimit fees, and interest.

Has anybody here gotten a loan from their bank without collateral or a co-signer?

I want to do this on my own. My sister is in far worse debt than me. And three years ago, she took out a $4000 loan with my parents as co-signers. A couple months later, she quit her good full-time job at Boeing, and took a lower paying job. A year later, she quit that job as well. She has since worked 12-20 hours at one job and been in and out of work for a regular job. She is currently working again, but my parents have been loaning her money left and right to keep up the bills they know about and keep from defaulting on the loan they co-signed. And she is now trying to get another loan because her bills are so bad again. I do not want to burden them anymore or ask them to risk anything. I would much rather owe some creditor than my parents.

At this time, I am working to improve my bills. If I can’t get the loan, I will keep plugging away at my payments. I am working on some ideas to sell my work during the upcoming holiday season. And I have more hours at work right now (plus plenty of food stockpiled, so I can cut food expenses right now).

So, with or without the loan, I can do this without my parents. If I can get the loan, it would be the best way for me. I get paid weekly, and I can have the payments taken automatically from my account, so I would not be able to screw up my payments. And with online service, I could pay extra on weeks with good hours to get the balance down faster.

I welcome any advice in how to present myself and get the loan approved.

I am also interested in common mistakes to avoid. For example, I have read in many places that people who get consolidation loans often charge up their cards again and get into worse debt. But I have also read that closing un-used accounts can lower your credit rating since they count the total balances and the total credit limits. The closer you are to using it all, the worse your rating.

I am currently planning to close almost all of the accounts. Some have already gone to creditors, so the actual charge cards are closed already. I completely paid off my Target card, and I cut it up. The account is still open, but I don’t have a card to use. The only card I really want to keep is the one I have with the credit union. The interest is much lower, and it is connected to my checking account. That is the only credit card I have managed to keep the payments current on through the whole problem time. So that one is in good standing. Everything else, I am planning to close as soon as I can.