Dear Debt Adviser,
I have been badly used by a credit card company. A credit card debt consolidator told me to stop paying for now and to save money in an account that can be used toward paying off the credit card later. Eventually, I’ll be able to settle down the road for 40 cents to 60 cents on the dollar. 

I’m tempted. I’m retired and don’t need credit. I would like to get back at the bank that has treated me so badly. 

However, I’m worried about the consequences to my wife’s credit. Her name is not on the card. If I take this action, will it have an impact on my wife’s credit? 
— Robert

Dear Robert,
I’m not sure what you mean by “badly used.” But, if the debt is valid, I hope you will reconsider and make good on your obligation.

I am also concerned that you might write to me later and tell me that you have been badly used by a debt settlement company.

First, let’s take on the card issuer. Every lender has its regulators and state watchdogs. I suggest you take your complaint to them. For the creditor, the pain from a regulator’s inquiry is much stronger than the insignificant pain of a debt settlement.

In addition, many ethical lawyers are willing to listen to your complaint and tell you if you have grounds for legal action. Again, this would create much pain for the card issuer.

Don’t forget your local TV consumer reporters. They love “abuse of the little guy” stories, and that can spell lots of lost business and maybe a refund or apology for you.

Lastly, a letter to the bank president could have profound effects down in the trenches.

I’d be remiss if I didn’t suggest just taking your business elsewhere. Rather than stop paying, research other credit card offers and transfer the balance to another credit card with better terms.

Denying your current card issuer the right to collect all the interest on your balance should help satisfy your desire to “get back” at the bank. The added bonus is you won’t be hurt in the process.

If you end up using a debt settlement company, be careful. This industry is lightly regulated and known for high upfront fees and inconsistent results. It also has been the subject of numerous consumer complaints.

Be sure to check out the company with your state consumer protection people before you sign up or send money. Be especially wary of fees that eat up your first payments, high monthly maintenance fees and back-end fees if anything is settled.

Also, be careful about giving power of attorney to a debt settlement company, and don’t forget that any settled amounts are likely to become taxable income to you.

As long as your wife is in no way connected to the account, and you don’t live in a community property state, her personal credit will not be affected by any adverse reporting of your account.

However, her life may be adversely affected. Because your credit history will be negatively affected for approximately seven years, your insurance rates will probably go up as your credit score goes down. If you are renter, you may have difficulty renting a new apartment.

If you have other credit cards (including joint accounts), lenders on those accounts may jack up your interest rates. You also should be prepared for collection calls and legal activity between now and when (or if) you are offered a settlement.

In many instances, collection attempts are wearisome and troubling. My last suggestion is to make sure your wife is comfortable with having unpleasant people frequently calling her home. I know it wouldn’t be long at my house before my wife gave me the “look” when the phone disturbed her quiet enjoyment of marital bliss for the umpteenth time that day.