Can Interest Still Be Charged?

by Kim
(Santa Fe,NM)

I moved to New Mexico from Colorado. I received a debt collection letter from a lawyer in Colorado with an old debt of mine from 2/2008 for $5558.37 from Citifinancial. Is it legal for them to still continue to accrue or collect interest after the debt has been sold to a collector?I have been trying to pay off all my $30,xxx debt for the last 3 years.
I cannot, with raising teenagers, rent, electric and personal items, besides groceries afford to pay anymore than 3 creditors at a time in the amounts $100-150 a piece. When I get done paying off one I start on another.
I will have 2 more paid off by Dec. 25th,2011. YIPPEE! I am plugging away, but don't feel that adding more interest all along,is fair and will never allow me to get it paid off. ugh.
I am willing to start paying on this as opposed to ever declaring bankruptcy, since I am of the mind that I made the debt, I need to pay it. But, I want to be able to legally ask them to stop the interest, is this allowable? And what do I need to send them>?

Comments for Can Interest Still Be Charged?

Click here to add your own comments

Jan 31, 2012
 Can Interest Still Be Charged?
by: Debtcollectionanswers.com

Kim:

Yes, it is legal for interest to continue to accrue on your unpaid debt. That is one of the reasons why it can be so difficult to get out of debt, especially if the interest rate is high. The accumulated interest can make it difficult to ever make a significant dent in what you owe.

I have a couple suggestions for you that may make things easier for you however.

First, have you contacted your creditors to find out if they will lower the interest rate you are paying or let you make smaller payments for a period of time? Some of them may be open to doing that. If so, get the terms of your agreement with them in writing before you start paying on it.

Second, another option is to settle your debts. When you settle a debt you pay off the balance due for less than the full amount. However, you must usually pay the settlement amount in one lump sum. I recommend that you listen to this debt settlement podcast to learn more about settlement. Again, if you negotiate a settlement agreement with a creditor, get the terms of the agreement in writing before you start paying on it. You may also want to work with a settlement firm, but choose the firm carefully.

Third, I would like you to reconsider your feelings about bankruptcy and explore that option. It may not be right for you, but it could be a relatively quick way for you to get a financial fresh start so you can begin saving for your future and your children's future. Our Founding Fathers provided for bankruptcy in the Constitution because they recognized that people sometimes go through tough times and so they wanted to provide them with a way out. If you file for Chapter 7, most but not necessarily all of your debts will be wiped out; if you file for Chapter 13, you will repay your debts over time, for less money each month, and some of your debts may be forgiven. If you would like to at least explore the option of bankruptcy, click here for a free consult with a https://www.debtcollectionanswers.com/bankruptcy-attorney.html. And go here to learn how to file for bankruptcy.

Hope this information is helpful to you.

Click here to add your own comments

Return to Debt Collection Questions.

Learn how debt collection laws can help you!
This website does not provide legal advice.
All information is for educational purposes only.
Copyright 2007 - 2018 by Mary Reed and Gerri Detweiler.
All rights reserved.