Legal Question in Credit and Debt Law in North Carolina

I don't know who gave you advice. It has a lot of half-truths. The debts will not go away. They never ever really go away.

If money is tight, then you have to focus on the important things in life - food, shelter, clothes and medicine, not credit card bills. However, your credit is going to take a nosedive when you quit paying. Credit scores, regardless of what they say on tv, are not all that important (although some insurers and prospective employers are now looking at that) unless you are buying a house or car or other big ticket item and will need credit.

Bankruptcy should be the option of last resort - its going to have negative consequences for your credit and will be on your report 7-10 years after the date of the discharge.

Options short of bankruptcy are debt consolidation and debt settlement. With consolidation, you go to a place like consumer credit counseling. They freeze your interest rates and you pay them a monthly sum. You still have to pay back the whole debt and many people cannot afford the payments. I have also heard that these consumer agencies are funded by the credit card companies so people are not really getting helped there. While you are in the program, your enrollment is reported to the credit bureaus so this does hamper your credit, although when you are finished, this will be removed.

There is also debt settlement. With debt settlement, you have to be careful as there are many many bad actors out there. Here is a cite for one of the better companies: http://www.nationallegalsystems.com. I provide legal advice to the PA and GA clients of National Legal Systems; a different attorney handles the NC clients and would give you advice and oversee the resolution of your debts if you enrolled..

With debt settlement, you enroll in the program and make monthly payments. The programs are comparable to debt consolidation (4 years on average, but could be more or less depending on your debts and how quickly they get paid off). When you have built up sufficient funds in an account which you control, settlement is made on one of your debts. Each account is tackled one at a time. This is not reported on your credit.

And having a debt marked as paid, settled for less than full value will help you re-build your credit. Mortgage and car companies only care about unpaid debts, not paid ones.

You can do nothing and ignore the calls. They are bad in the first 90 days and gradually diminish. With most accounts, they get passed from collector to collector. You could take this approach and do your own debt settlment in the sense that you start building up funds and let the letters come. When you get enough funds, you settle one debt at a time.

The problem is that some or all of your creditors (be they original creditors or debt collectors) can and will sue you. If you think not paying your bills was bad, having a judgment against you is worse. With a judgment, the creditors can garnish your bank account or possibly seize any non-exempt assets (I don't know what assets you have and cannot assess your risk). While there is no wage garnishment for most debts in NC, the judgment can last for 10 years, it can be renewed for another 10 years and it earns interest at a rate of 8%. So doing nothing is not really an option unless you are 82 and in a nursing home with no assets.

What you should do is look for a bankruptcy attorney in your area and get a free consult to learn about bankruptcy and its consequences. It does not mean you have to file. I would look into debt settlement as well as debt consolidation and see which of the three options is best for you at this time.