Legal Question in Credit and Debt Law in Wisconsin

I would like this question answered by an attorney who practices law in WI.

I am a small biz owner that may

have to consider dissolving the company in the near future.

Credit card debt has accumulated with several companies. I am making our minimum payments but the reality is that I may not be able to continue doing so which could result in a default situation.

I would like to approach this issue carefully and logically - step by step - with bankruptcy being the last option to consider.

I'd like to take the pro-active approach by contacting the credit card companies and negotiating with each of them about our debt.

1. In the past, I have been successful in lowering our APR rates but have people been successful with credit card companies about their overall debt issues?

2. Will contacting the credit card companies affect my credit rating negatively? Since I have several credit cards/debts does one credit card company contact the other about status? Then, do they contact the credit reporting companies on developments?

3. Is there more merit in negotiating with credit card companies having an attorney make the calls rather than myself?

4. Then there's WI Chapter 128 law. Need some clarification and advice. Could this be an avenue worth exploring?

Hope I've clarified my issue.

Looking forward to your response.

Many thanks.

he credit card companies and see if we can negotiate interest rates and balances.


Asked on 9/30/10, 2:45 pm

1 Answer from Attorneys
JAY Nixon nixon law offices

As the old saying goes, all things are possible under the sun. However, many of the things which you suggest are not likely due to the greed of individual credit card companies when they are competing with other credit card companies over a limited pool of money. And, as anyone who has carefully read over their credit card statement recently knows, that greed is virtually unlimited. It doesn't matter how many companies you settle with if any one of them refuses to settle and garnishees your wages, removing 25% of your net wages (or 100% of your bank accounts if they are garnisheed) from your available pool of settlement funds. That is why bankruptcy, whether chapter 7 or 13, works better since it has the benefit of the force of law. It forces creditors to settle for zero cents on the dollar in chapter sever or a fixed percentage set by the court in chapter 13. Wisconsin chapter 128 if virtually useless since it does not provide you with any discharge of debt at the end, only temporary relief from garnishment while you pay everyone at the rate of 100%. It can be useful for those who are not eligible for a discharge in chapter 7 bankruptcies due to already filing within the last eight years. If you do wish to offer a lump sum settlement, a bankruptcy lawyer who is ready to "pull the trigger" on a bankruptcy filing is the best person to present it. In such circumstances, I have had a 100% success rate in obtaining the consent of all creditors to proposed settlements for clients who have been able to deposit a significant percentage of the total owed into trust before I present a nonnegotiable offer to creditors with a promise of immediate payment. My comments here are not legal advice, nor do they create an attorney client relationship between us. However, you are welcome to contact my office to discuss retaining me or to set up a free initial consultation at my office in Racine.

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Answered on 10/06/10, 5:59 am


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