Do I Pay All Of That?

Because of late fees, Monica's credit card debt went from a little to a lot. How does she deal with it?

QUESTION: Monica has $300 in very old credit card debt. However, now the bill is $1,500 because of late fees and charges. Is she liable for that?

ANSWER: Every month you’re late or over the limit, there is a charge. Legally, they can hold you to that. If they haven’t received payment in a while, you can probably settle this for $500. Don’t give them any money until you get it in writing what they will settle the debt for. Don’t give them electronic access to your checking account. Once you have it in writing, staple a copy of your cashier’s check to that letter and keep it for the rest of your life, because it will come up again.