Well it is official. My old car is gone! Towed to lord knows where and who cares for what future! What a huge relief to be done with it after all of this time. I am still surprised to learn there is a statute of limitations for auto loans because I always thought they were kind of like student loans.... will haunt you even after death lol. I have a three day weekend so I think I will use it to relax and not think about finances. Then I see where I am at and figure out what to work on next.
Viewing the 'Die Debt Die!' Category
Wow. I am making progress in an unexpected way. Remember when I mentioned my neighbor asking about buying my old car (even though it is a piece of junk) and how I was not sure where I stood with it financially. Well one of the wise members here suggested I get a report to find out if the lien holder is even still listed. I did that (and it cost me $3 *eye roll*) and it turns out the lien holder is still on there. I had no interest in trying to deal with them so I decided to get some legal advice on what my options were. I really just want to be done with the matter and am happy to make payment arrangements if that is necessary.
I am not exactly in the know when it comes to lawyers so I used the Employee Assistance Program at work to ask for a referral. That turned out to be a wonderful idea because they connected me to a firm that specializes in debts and collections and told me I can have as many consultations as I need on any number of matters for free. Yep FREE! Can you believe that?! If I ended up needing an attorney to represent me they could provide that for a fee, but I was hoping not to get to that point.
The experience was actually quite pleasant despite how embarrassing it was to explain why I wound up with an unpaid and now non operational vehicle. After all of that I was given surprising news. Apparently it is past the statute of limitations to collect on this debt, which is why it is no longer showing up on my credit reports (I just thought they made a mistake lol) and why I was sent cancelled debt forms to file with my taxes a few years ago. Basically the cancelled debt forms were the lien holder’s way of settling their books since they cannot pursue me any further. This also means that the vehicle is the lien holder’s property because they possess the title and they will take possession of it if I call them and tell them where it is. Apparently this will happen fairly quickly because they will not want the city to tow it and have to deal with impound fees or whatever.
I will admit I was stunned by this information and did not do anything for a week or so. A part of me was relieved that there is a light at the end of the tunnel, but another part of me feels bad about not paying like I intended to. I did not want to be in this situation and I certainly was not looking for an easy way out. I have more than learned from this experience however, and am doing everything I can to never be in this situation again. Continuing to stall does not change anything so today I placed the call to the lien holder. I did not identify myself or provide my contact information, but gave them the vehicle’s identifying information and location. I even told them that it will require towing, how nice of me right? That was also a pleasant call despite the circumstances. Now I just have to wait and see how long this all takes. The firm told me to contact them immediately if I have any hassles from them, but hopefully it will not come to that.
Ok so maybe my progress train has derailed a bit or maybe I am over thinking it. Here is the rundown of what has been going on.
1) Day job... It is terrible. The work itself is boring, not challenging, and despite what I was told in the interview process I am not actually using any of the skills I developed in my graduate program although they are paying me for those skills. My boss hates me and has made it clear she is not impressed with me or my work. I am doing exactly what my colleagues are doing and yet they get raves from her. There just do not seem to be any great options to try to make the situation better without winding up in a her versus me situation and her longevity winning. I am still in my probationary period and cannot afford to just walk away so I am trying to tough it out, but am also keeping my eyes peeled for other options just in case.
2) 2nd job... In February there were more hours available and we lost some team members so I expanded my schedule a bit. The extra money is good, but this on top of my day job and everything else is just tiring and made me realize that I do not want to work like this until I retire. I think for the longest time I just assumed I would have no choice but to work like this, but with my career change it will not be necessary since my earning potential has increased. March has slowed down which is nicer.
3) Spending... I have not gotten out of control here likely because I have been working so much. I am still eating out more than I would like due to the long hours, but my new cookware has arrived so hopefully I can change things soon. I have also treated myself to tickets to a few upcoming performances and arts related events, but had no problem saying no to shows that I thought were just way too expensive.
4) Expense Tracking... This I have totally slacked on. I have pretty much all of February’s receipts to enter and those from the beginning of this month. I know I did not go over budget because there is still plenty of money in my checking account, but I miss the organization of seeing everything on the spreadsheet. LOL! There is something I never thought I would say.
5) Debt Repayment... Ummm I have not done anything here since paying off that payday loan. I did call to take care of the second one, but their system was down so they could not process it. Then I just got too busy to call back during their business hours. I just feel kind of directionless in this area, but maybe I am just tired. I keep having the strangest thoughts..... What will I do when all the debts are paid? Of course I could use that money for other things. But what other things? What if I run out of other things? Maybe that sounds stupid.
6) Savings... I have slacked off on the 52 Weeks Savings Challenge and adding to my EF. There are plenty of funds sitting in my checking account, but I have to move them and I just do not feel like it or that could be me being tired again. Sometimes I feel as if I cannot remember why I wanted to save in the first place. This could be because I did not outline a purpose for the 52 Week money and because the things that would normally be emergencies that would create debt I am now able to comfortably afford.
7) Surprise!... A minor legal matter has popped up and no it is not debt related. It is something I expected to have to deal with at some point and apparently that time has come now. Thankfully I can handle the matter myself and will not need to hire an attorney. It will just be a pain to have to go down to the courthouse to get everything squared away. The fees are a bit more than I expected so I am considering pausing my debt repayment to take care of this. Or maybe I should pause my saving? I do not know.
Today I decided to pay off one of my smaller debts with a portion of my tax refund and settled on an old pay day loan. I did not want to risk dealing with an inexperienced employee in the store so I just called the corporate office to find out how to proceed. Well surprise surprise they were able to take my payment right over the phone for no extra charge and cleared my account immediately. Worked for me!
Then I got a second surprise when she mentioned another outstanding pay day loan, but from a different company. I knew about this one and figured I would deal with it next month, but I was not sure how she knew about it. Turns out the other company is their sister company, which means they should not have given me a loan because I had an outstanding one with their parent company. Their bad. The upside is I can deal directly with the parent company to clear that one as well for no extra charge and the amount due is much less than I thought it was.
I knew getting out of debt would be a slow and somewhat emotional process, but it was really nice to not be hassled regarding this account. I expected there to be rudeness, snarky comments about my being irresponsible, and some ridiculous hoops to jump through just to get them to take my payment. How nice to be able to just pay and move on.
Yesterday I checked my mail and was surprised to find the title to my vehicle properly signed off by the title company and a final statement confirming that I am paid in full. What a strange feeling I had while looking at it. When things got really rough I did not think I would ever pay off that loan or see the title again, but here it is. Today as I went about my usual routine I finally figured out what that feeling was.... relief. I cannot remember the last time I felt that so strongly. Now I feel ready to pick up the pace and resume meeting my financial goals, instead of the lag I have been feeling since paying off that loan.
It was just after the New Year that I got an updated statement from the title loan company and I was happy to see that the balance was finally under $500. On my next paycheck I sent them a final payment and thought good riddance. They will forward my title as soon as they have removed themselves as lien holder and I will go back to owning my vehicle outright. This debt is finally dead and this experience (life lesson?) will never be repeated. The final numbers are as follows:
Amount Financed $3090.00
Amount Paid $9983.35
Yes those numbers are daunting, but as I mentioned in a prior post part of the reason the amount paid ended up being so high was because I wound up paying late or making partial payments on so many occasions. When that happens generally they apply payments to late fees, finance charges, and interest before going anywhere near the principle just like most other debts. That is also how they make their outrageous profits, much like payday lenders.
Thinking back to the dire circumstances that led me to get this loan in the first place leaves me with mixed feelings. I did have to deal with that situation and at the time there were no better financial options available so I cannot say I regret doing it. However, I do regret not having educated myself earlier on about how to put myself in a better financial position so that the odds of me going this route were significantly reduced. Oh how grateful I am to be doing things differently going forward.
While I am happy to be done with this debt I think I expected to feel differently when it was over. This frees up so much income to throw at other debts and savings and I guess I expected to feel more inspired to pursue those goals. Instead I just feel kind of flat and like doing nothing. That is not realistic and I will not actually do that, but I am surprised to feel that way.
Wow 2015. I have actually just spent the first week of the New Year trying to take in all the progress I have made and all the goals I have set for myself. As mentioned in the sidebar, my goals are in no particular order largely because it was too exhausting trying to decide what should come first. I have had enough stress the last few years and do not want to continue that way going forward. Once I felt centered I figured I would just be guided to handle each goal in whatever order I was meant to and that would be ok.
So here I am having a loungey TV binge day at home (I just discovered Switched at Birth and am almost done with season 1) and there is a knock on my door. I am not the type to have guests so knocks are usually the landlord, someone needing directions, or well meaning religious types. Turns out it was one of my neighbors that I have seen around a few times. I have lived in this complex for a few years, but I pretty much keep to myself or am gone a lot so I do not really know any of the other tenants. She came by to inquire about my old car (the one I still need to deal with) that I have parked here and registered in non-operational status. I just told her that it is a hunk of junk that no longer runs (which is true), I am still making payments on it (not exactly true), and when it is paid off I am dumping it at the nearest junkyard.
Well funny thing is she loves it and does not care how much work it needs. She thinks it is adorable, is mechanically inclined, and sees it as a fun project for herself. She said when I am done paying on it she would love to take it off my hands. Visually it is cute so I kind of get that, but why on earth would she want to waste the time and money fixing it up? I rattled off all the repairs I had to do over the years because of its poor design, the high cost of insurance (I do not currently have it insured to save money), and just what a huge pain in the ass it turned out to be despite its cuteness lol. And after all that she is still interested! Weird right? I guess this is the universe telling me that I should begin working on this goal now.
I actually do not know the current status of the vehicle and was thinking of using that EAP service through my employer to talk with a lawyer about it. When things got bad (as detailed in my post The Indebted and the Irresponsible) I was not able to keep up with the payment and the lender would not work with me, surprise surprise. I figured they would eventually just pick up the car, but that did not happen. Then a couple of years ago I got some tax forms (which I filed as part of my return) in the mail related to the loan because I assume they were writing it off their books. They still did not pick up the car, I still do not have the title, and I have not heard from them since those tax forms so the status is unclear to me.
At this point it is not really worth anything so taking it back would not do them any good, but I am thinking there is room to reach some kind of settlement on whatever amount they were not able to write off in exchange for the title. That is why I figured talking to a lawyer might be a good idea and then they could handle that kind of negotiation and explain all the fine print to me. If that is indeed possible and my neighbor is still interested then I have no problem letting her have it as I am ready to let it go.
While it was my December goal to have the title loan paid off I do not think I made it and not because I lacked the funds. I am actually still waiting for an updated statement from them and they were closed a day or two for the holidays and may just be behind. Even though I may have to make a payment or two in January this is already feeling like a huge burden lifted and seems like a positive way to start the New Year. Thanks to the avalanche method I am also seeing the light at the end of the tunnel and am happy to be on track with my other debts.
In reviewing December’s expense tracking spreadsheet I could not help but notice that I spent a third of my net income on debt repayment and past due bills. Yes you read that right.... a third! I can hardly believe that myself and I definitely want that to change in 2015.
Finally dealing with my debt has been a relief. I still have not opened those other two credit reports and therefore do not have a complete picture, but that is ok. Even though I wanted to get into a position to improve things for a long time I know I have to pace myself. Otherwise I will get discouraged and probably do nothing which will not do any good. Here is what I have tackled so far:
Amount Financed $3,090.00
Amount Paid $6,642.01
Balance Due $2,748.34
Yes I know that is ridiculous lol. The interest rate is outrageously high and I accrued late fees when I could not pay on time or made partial payments. I do not like to say never, but after this experience I can truly say I will never do this again! I am absolutely determined to have a decent EF so that I do not have to resort to this ever again. I seriously cannot wait to pay this off and be done with them forever.
Given that this is my top priority and the interest rate is so high I decided to use a modified Avalanche method. Basically instead of making a monthly payment I am making payments from each paycheck, because I have been blessed with two jobs. Given my estimates of this months income I see this loan paid off before the new year.
While the goal is to be debt free one day I am less stressed about these debts. Why? Because before my world turned upside down (when I just had my Undergrad loan) this was the one debt I was actually happy to pay. The whole experience of getting this bill, writing a check, and putting it in the mail reminded me of what I had accomplished with the money I borrowed. Despite how easy it was to get a forbearance I felt the guiltiest about being unable to pay this debt. At that time the payment was $100.00 a month and the fact that I could not afford that (or less than that!) made me feel like such a failure.
As soon as I finished my Grad degree this past spring I could not wait to enter repayment. I was still working a low paying job (although permanent full time with benefits) with no idea how long it would take to get a better one so I applied for the Income Based Repayment (IBR) on both loans. I was surprised that IBR gives you the choice of using last years tax return or submitting current paystubs to determine your monthly payment. I opted to use last years tax return because my income was less while a full time student and primarily temping/unemployed. I figured I could use the breathing room to take care of more important debts and get caught up on household bills. Right after I turned in the IBR paperwork I landed my new job, but decided to stick with my original plan. IBR is good for one year and here are my monthly payments:
They likely settled on $0 because at the time I was making less than a third of my overall loan total. My hope is that I can begin paying midway through 2015 and at least enjoy writing the interest off on my taxes. When its time to renew in 2015 I am leaning toward using my 2014 tax return so the payments stay low, allowing me to focus on building my EF.