must you STOP making payments to settle credit card debt?

[daisosasen01]

So how do I do this? i have not paid on one credit card because I preferred to pay off my car. I'm homeless and have only my car as shelter. How do I get this last credit card off my back so I can finally start on the "road to recovery". Any information is well appreciated. If I am not working on a temp job (which don't come by too often) then I am in the library reading. Or looking for work. Any help is appreciated.I can be contacted at kojiosuna@gmail.com

[cognitivefun]

savings from debt settlement is often NOT taxable income. The big exemption in the IRS code is to the extent you are insolvent. If you owe $50,000 and you only have $10,000 when you settle, you are insolvent to the amount of $40,000, and you can have $40,000 of "cancellation of debt income" without it being taxable. This means many if not most folks settling their debts will NOT owe the IRS. You should see a competent tax advisor on this calculation but that is pretty much how it works.

[rayme4raw]

He's right, around month 4 & 5, they started sending me settlement letters. For example, if I owed $3000, they would take $1000. I defaulted all the way however. The primary lenders were very civil, but I would only give five pieces of information: name, address, phone #, that I was unemployed & when I became unemployed. If they asked any other questions, I'd hang up on them, it's not my job to give them information. In 6 months, my credit will be perfect again.

[traderpete007]

You also have to realize that the savings are taxable income. With that in mind and companies only have to report income over $600 you have an important base point to build your settlement strategy.... Sometimes a savings of $599.99 is better than a savings of $700 when you have to pay the settlement PLUS taxes on the $700

[walloon8814]

Richard is Right - You can do it yourself. I did using his tools. No Debt Settlement company that your Credit Card Company won't Deal with - Just Me and Richards program. It took a year for all four Cards to Settle, but I got out from under the burden of $32,000 in CC Debt for about $9,200.00 in Settlement. Yes, I had to borrow from Family and sell a bunch of useless stuff and save like crazy. But I dealt with the phone calls and the letters. Actually the collection folks were all civil to me.