I'm in a bad pickle at this time, so I'm reaching out to the Green to help me decide which the best next step is moving forward.
To keep it as simple as possible, I got in a car accident more than two years ago, using a major car rental company. I got an unexpected bill from the car rental company almost two years later (late December 2011) for a high amount (let's say over $30,000) that the other party apparently were given by the rental company due to their alleged injures. I had no insurance when I was in the accident. For many reasons, I felt the collection of the debt was unfair. I had temporary legal representation (a family friend), but he was unable to get the car rental company to forgo the collection, so he bowed out early January.
Since then, I have tried numerous ways to get the debt waived. I created an online petition, contacted various social media outlets, and even contacted the rental company's customer service office with no success. Late summer, the company had a debt collection company contact me to collect the debt. I avoided contacting the debt collection company because I was in the process of finding a lawyer. Finding a lawyer has proved to be harder than I thought, as many lawyers were unwilling to represent me, probably due to the complexity of my case. It doesn't help that my budget/financials are limited at the moment (which means, in essence, that trying to collect $30k+ from me wouldn't succeed, to be frank). You can't squeeze blood from a turnip. As of now, the debt collection company has been contacting me almost everyday via phone, but at this very point, AFAIK, no lawsuit by the rental company/debt collection company has been filed. I advised the debt collection company that I was in the process of finding legal representation.
Now, I am facing a few possible scenarios, each of which has their own pros and cons. I'm completely unsure which is the best scenario to pick and proceed.
Scenario 1: Declare bankruptcy.
Pros: not quite that expensive to do, easy to liquidate the debt, and a way to 'wipe the slate' fresh.
Cons: student loan debt I have won't be liquidated, my credit would be tarnished somewhat, possibly not an option until an actual lawsuit is filed against me? also, I'm 26… I feel too young to be doing this.
Scenario 2: Negotiate the debt amount and pay a lump sum.
My parents has a certain amount of money saved up for me (under their name), so I was thinking about negotiating with the debt collection company and offering a lump sum of said amount (maybe going even lower, if possible). I have discussed this potential solution with my parents, and my father doesn't think this is a good idea, because the debt collection company would think I have a source of money (after seeing/accepting the final lump sum offer), and demand more even after the lump sum has been settled. However, numerous articles on the web suggest doing just that (negotiating down with a debt collection company, paying a lump sum, and coming to an agreement in writing that the debt has been paid in full). Here's an example
of such an article.
Pros: paid off completely, peace of mind knowing I have paid this debt "in full"
Cons: would my credit score still be hurt? may have to pay 'back-taxes' on the waived amount; the fund my parents has saved is less than half of the debt, my father's concern mentioned above.
My father suggested I pay them (the debt collection company) a certain amount per month, in hopes that they may cave in and just write the debt off, but with such a high debt, I don't know if that's possible, and it's also the principle behind this that bothers me. I do not want to pay a cent, if possible.
Scenario 3: Find a lawyer and fight tooth and nail with the car rental company.
I have been searching for a lawyer to represent me and argue my case against the rental company, due to the circumstances in my situation (which I won't go into right now; it's a long story, and I'm focusing right now on finding solutions, not dwelling on what's wrong, what's right). I've found several potential leads.
Pros: possibility of winning, I may have a good case; standing up for what principles I feel is right.
Cons: it's a gamble; not guaranteed to win; may end up paying legal fees plus the debt if I don't win; this may drag on and on for a long time; legal fees are expensive; hard to find pro bono lawyers.
Scenario 4: Contact the rental car company personally.
I would try again, this time speaking with the executive office or even the President's Office if necessary. Probably not the best solution at this point, but as the rental company still has to authorize the final amount I owe through the debt collection company, it may be worth a try to try and negotiate with the rental company.
I hope I made sense throughout this. As you can probably see/sense, this really is bothering me and eating at me, and I am anxious to get this resolved as soon as possible, but am just not sure of the ramifications of every possible scenario and the potential positive/negative consequences. Most importantly, I want this resolved without paying too much out of pocket, and with my credit score being pristine (it's probably already tarnished, due to the debt collection company). I also, of course, want the debt collection company finally off my back and peace of mind restored. Any questions are welcome - I obviously do not expect sound legal advice, yada yada, and I really look forward to your suggestions/ideas/input. Thank you.