I just graduated from college...?

From Jan '06 I had a credit card with a $9000 limit while I was in school. I had to live off my credit card for a little while during that time, and I was charged a fee that put me over my limit, and then recieved a fee for being over my limit, so on and so on. The card is now $11960. I havent made a payment since dec. of 2008, because I couldnt make the monthly payments (and then talking with other people throughout 2009 they said not to pay anything, because it restarts the clock?) . I called to try to work it out with them and was told that that is how they make there money and there was nothing they could do for me.





I just graduated in May, and am still looking for a full time job. I am working 3 part time jobs, but am hardly making enough to cover my $996 a month in school loans, much less trying to pay this card off.





In june, we tried to settle for a lesser amount then what I owed, but since I had just graduated and was just starting my job that week, with no savings to really speak of, I wasnt able(or comfortable to) agree to make the $900/mo payment for 4 months, because I was afraid of what would happen if I couldnt make the payment.





On my credit report it has been written off as bad debt. They sold it to a collection agency, who had a law office send me a letter about trying to collect. As far as Im concerned its already affected my credit for 7 years, and the bank that I had the credit card through wrote it off. If i contact the law office, will it restart a clock? what happens if I dont contact them?








I am working hard to get on my feet, struggling to find a way to pay my school loans (trying to consolidate w. a bad credit score because of this credit card mess and I dont have a cosignor), I need a car (also w/ bad credit and no cosignor), %26amp; I would like to move out of my parents house......


Any suggestions on the smartest way to do all this?





Thanks!|||Your credit is totally fouled up. That affects your ability to get a job (employers don't want to hire debtors, especially if they have any access to any money or accounting functions). You cannot get a car loan - no more bad credit car loans except from the high-interest, fast repossess, crashed cars sellers. You cannot get an apartment. You must continue living with your parents until your credit is fixed.





If you do not negotiate with the collections agency or attorney, get this settled and paid, they will take you to court, get a judgment for the bill, interest, penalties, legal fees, court costs and collections costs. Then they can continue to go after you, take any sort of asset, garnish wages (which will probably cost you the jobs you have) until they get their money. Judgments, bankruptcies and foreclosures remain on your credit report for 10 years from date of satisfaction of judgment (after you pay it off and the court releases it), date of discharge of bankruptcy, or date of foreclosure.





In short, you have to pay all this off or declare bankruptcy. But you cannot discharge student loans in bankruptcy - you are on the hook for them not just until you die, but until they take your entire estate, Social Security, etc. A $12k credit card bill probably will not be discharged but instead go into a payment plan until it is paid in full. The court takes your money, pays your creditor, plus you have to pay court costs, bankruptcy attorney, bankruptcy trustee, etc.





Forget about "resetting the clock." That only applies IF the statute of limitations had expired. That won't happen for years.





Pay your student loan first, then the credit card debt, then busfare to work. You do not have a cent for anything until these are paid off. Ask your parents for help with the student loan. See if you have anything to sell to raise money, find a better paying job, do whatever it takes to get more money and pay off those two debts.





Miserable start to adulthood, but you have trapped yourself here, and no way out but to pay.|||Whatever you do, don't speak with the collection agency or the law office. Deal directly with the company.





Your credit report will still come out looking better if this is shown as a delinquent loan that is being paid down than a bad debt. You will have trouble finding an apartment or buying a car as long as you have a bad credit score. Getting rid of this black mark should be your second goal (after paying down student loans).





Call them back and make your own proposal for paying it back. If necessary, work with a legitimate credit agency (be very careful in choosing a legitimate non-profit one that it is not a scam artist that will cost you even more - check them out with the Better Business Bureau) to come up with a plan to pay it back. Though it is harder, in the long run, your credit score will improve, especially once you get the amount below the credit limit on the card.