Our moto...bad things happen to good people

AAARRGGG!!! I'm still posting a day behind. Well maybe today will be my changing point. Now on to our regularly scheduled program.

Yesterday was my scheduled phone appointment with a credit counselor to see what could be done with our finances. Jim had tried to wake me up to let me know he was leaving for work, but I think all I gave him was an I love you grunt. I finally got out of bed, (not sure I was wake yet) and grabbed something to eat for breakfast. Breakfast couldn't have been that good, because I couldn't tell you what I actually ate.

I was a little anxious before the phone call. I am not really one to dabble with money. I don't like to gamble, I don't dabble in the stock market, and I'm not really fond of loans, consolidating etc. To me, doing any of these things is an opening for disaster. But I had to do this. We would not make it many more months if I don't talk to these people.

8:30am. I called the phone number for the appointment. I was taken to the gentleman's voicemail. Okay, I wait for him to return my call. It wasn't that long of a wait, and the phone rang. I let the answering machine pick it up since we are getting swamped with creditors calling. A nice gentle soft voice starts to leave a message. It was Mr. Jiru the consultant. He apologized for having to call me back. I assured him that it was no problem, as I understand that many people are in our position. He asked me how we got into the situation, and how could he help us. I explained everything that has happened, and he told me that he could really help us. He first explained what the difference is between the ads on tv and a credit counselor. This is how he described it to me:

The ads on tv are called debt settlements. The way they work is they tell you to first of all cut all contact with your creditors. Then you pay this company a monthly amount. The first 6 months that you are paying this company, is basically their fee. They have not yet even contacted your creditors! Then once their fee is paid, they will contact one of your creditors that has the least amount due and make them a deal. Naturally the creditor is going to accept the money, they haven't heard from you in months! This whole time you are still paying this debt settlement company. When you have built up enough money for the next creditor, then they contact the next lowest debt. This goes on until all of your debt is paid. What they don't tell you is that since there is no contact with the creditor they can send you on to collections, keep accruing interest, and finally seek legal action. Once the debt is paid, it is reported to the credit bureau as a settled amount and is not a positive addition to your credit report. On top of that, say the debt was $2000. and they settled for $1000, you will be taxed on that other $1000 for you yearly taxes.

A credit counselor is different. First off, most of them are non-profit. They contact your creditors right away, and their set up fee is added into your monthly payment amount. Since they contact your creditors, there is no bad feelings or negative credit reports. They set up a freeze on all of the credit accounts that you are dealing with. Now with this freeze, not only can we not charge on the accounts, but the credit companies can not add late fees, over the limit fees, or interest on the accounts. The credit counselor negotiates with the creditors to drop your amounts down to almost a third of what you owe. The debt is usually paid off within a 5 year period. But the best part is that your credit rating is not damaged.

While I was talking with Mr. Jiru, he told me not to close my accounts but to leave them open while we are paying them off. It will show that we have a positive debt to income ratio. He also told me not to close any other accounts that we have that we are not using, as they also show that we are not just out to rack up credit and not pay. Mr. Jiru told me too, that if I contact the credit counselor today and tell them that I would like to start my payment plan in July, I can get things going right away. That means no annoying phone calls!! Woo hoo!!

I was feeling better after the phone call. So I jumped on the phone again and called the credit counselor. They were able to help right away. They took down all of the credit cards that we were dealing with, and their amounts owed. I was asked how much do I normally pay a month to the creditors and I told them about $1,500. I was put on hold for just a few moments, and the counselor came back and told me that they could bring my payments down to $642 a month!!! And that we will have them all paid within about 4 years!! I said sign us up! They were going to e-mail me a form to fill out and they would start the process right away.

I was feeling really good after that. I called Jim and let him know. He was excited as much as I was. Finally! We could get our life back into order again. I putted around the house picking up and cleaning. I blogged a little bit and was getting stuff ready to defrost for dinner. I was also getting excited to go to karate. I had purchased some sparring gear from a lady on Craigslist for $25. So I was going to take them to class and really beat on the instructors. LOL.

About 4pm I got a phone call from Jim. The van won't start. It started once but then died and won't start again. Great!! That's the last of our vehicles other than Jim's motorcycle. I can't really take mom and Kelly shopping on a motorcycle! So Jim called AAA for them to tow it to a shop we deal with. A friend brought Jim home. Now we wait. Now what?!?! We had just had a new fuel pump put in about a month ago, and it's acting like it's not working again. Needless to say, Jim was in a foul mood. Now we have to have the van fixed and we don't really have the money for that. If it is the fuel pump it's guaranteed but if it's not, I don't know what we are going to do.

Dinner consisted of pizza pretzels and chicken nuggets with ranch sauce. Not the healthiest of meals but I didn't want to cook after the news. So I am still dealing with my emotional eating. It gets so I don't even think about it if too much is going on. I HAVE to get my life back in order or I'm going to destroy everything I've worked so for.