Triple Play: Car Insurance, State DOR, Business Loan,

Image via Wikipedia I've been popular with the letter carrier recently. I got two more registered letters: one from my car insurance company, one from my state department of revenue.

And I followed up on them all. (Yay Polly!)

Out 1: The car insurance company wanted a certified check or money order for payment, but I had already sent an automatic payment through my bank. The very helpful rep suggested I try to cancel that payment and pay with a debit card from the same account to avoid the risk that they won't accept the payment and cancel my insurance. Seems like a good plan.

Out 2: The state was kindly informing me that they received my 2007 return and will be happy to levy my federal refund for taxes owed. Not a big deal, since there will be no refund. As a matter of fact, the IRS already absorbed my economic stimulus check. The state will have to get in line.

But, I did call and talked to a colleague of my previous contact at the State DOR (see back story). I explained that I had done everything requested of me but am still waiting for the forms for electronic payment for the payment plan we had negotiated. I live in fear they will levy my wages again. I do NOT want to go through that again. Success--he gave me the direct phone number of the woman I talked with a few months ago AND told me her hours.

Out 3: This poor collections guy from the bank where I have an outstanding business loan has been trying to reach me for months. I have called him back numerous times, but we never seem to be able to connect. (Plus I am not willing to give collectors or creditors my work number or my cell phone number, and I'm at work...a LOT.)

There's a long, and probably boring, story behind this business loan. I took it out as a line of credit when I opened my business to even out my cash flow. It's got a pretty good interest rate--lower than any of my credit cards. I used it as intended for years: borrowed against it, paid it down, borrowed again.

To pay taxes last year, I borrowed against it and ran it up again. Not to my limit, but enough that it became difficult to repay with no actual revenue coming into the business. At one point I had set up an automatic deduction to pay the balance from my business checking account. So, what begain to happen was that the payment would hit my checking account, which had nothing in it, and I got charged exhorbitant fees from the checking account for bounced checks. I was not on top of that.

Eventually, I would figure out what happened, make a transfer from my personal account to my business checking account, and then it would start all over again. After a few late payments, I guess the bank decided to run my credit report. They sent me a letter that they were closing my line of credit because my credit score had declined. That wasn't a big deal to me--I wasn't planning to borrow anything more--just trying to figure out how to pay it off.

So, they referred my account to collections, and this one individual would call me every month, and I would make good on the payment, or a couple of times, they just 'took' the money.

I wanted to close my business checking account because it doesn't make sense to be paying this loan out of an account...that never has any money in it. It's costing too much. My branch manager said I have to clear up the loan first before I close the account.

So, I finally actually got through to the collections guy today. And he was great. I told him the situation, and he said, "Well, Polly, it really doesn't look TOO bad."

I laughed, because from where I sit it looks awful.

He said, "Yeah, I don't have that kind of money lying around either, but I deal with people who owe hundreds of thousands of dollars who have closed their business, so in comparison, this isn't that bad." Yikes!

He suggested I fax a letter asking to have my overdue interest deferred until the end of the loan period so that he could refer me to the guys who can help me work out a reduced payment schedule. (I guess they won't talk to me if I'm behind schedule.)

I asked him if they had reported this loan to the credit bureaus, and he said they hadn't because he had kept me from ever going 30 days overdue by this trick with the checking account.

So, I'll write the letter, and keep the account open, and see whether the guys can help me.

I'll tell you, the journey is a lot easier when the voice on the other end of the phone isn't in a snit.

A good day.

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Bravo Bank of America

Image via Wikipedia As I mentioned yesterday, I have an alumni affiliated Bank of America credit card. I used it for business, my business failed, I made some stupid mistakes, and my rate skyrocketed.

Today, for the first time in months I talked to a helpful, competent and compassionate account rep who put me on a 5-year payment plan and reduced my interest rate from almost 30 percent to 10 percent. Woot!

Of course there are pluses and minuses here. This was one of those bait and switch cards: 0% introductory balance transfer rate with stiff interest penalties for late payments or going over your limit. (Please don't ask how I know this). I've learned you have to be a lot more organized than I am to make it worthwhile.

And this payment plan is only available if they close my account, which puts (another) black mark on my credit report. (I'm thinking that at this point it couldn't get much blacker, but that's a thought for another day.) And, if I can come up with and additional $168 sometime over the next 6 months, they won't report it as being "closed by lender". (Doesn't that sound like extortion or something? Is that kosher to ask for payment to preserve your credit?) So I have 6 months to get over my fear of looking into my credit report, which I know can't be good.

Polly's Pointers

1. Persistence pays.

2. Beware of low interest rate teaser offers.