How to handle it, when you owe
Our panel from Consumer Credit Counseling answered lots of questions about debt repayment, and what to do if you cannot pay.
~The logistics: if you don't pay credit cards, you may be hit with late fees first, and a collection agency, the next usual step, will add even more fees. Attorneys can also add fees, and garnish wages--up to 10%. If you don't pay the IRS, you could see whole paychecks withheld, plus liens placed on property, as well as daily fines. The advice: talk to whoever you owe to work out a payment plan, to minimize consequences.
~If you make a debt settlement to pay back at a lesser amount, our counselors say you could still owe taxes on what is forgiven, so make sure you pay the IRS or again, you face fines.
~Just because you did not get a bill, does not mean you don't owe: you need to keep track of mortgage and tax due dates, and remember roughly what you spent, where...If you're overdue because a bill did not get delivered, talk to the creditor and you might get a late fee reduced, at leat once.
~And if you're paying back, the recommendation is to prioritize: mortgage gets first call (so your home is not reposessed)--the same for car payments, then other bills, with credit cards probably at the bottom of the list: it will mean late fees and lower credit scores, but at least you won't lose a home or vehicle.
Consumer Credit Counseling answers your phoned-in questions live on Monday evenings from 5 to 6:30pm. You can also email questions in advance to money@cnycentral.com
