Primitives discuss a subject they are experts in...being deadbeats.

[Carl]

http://www.democraticunderground.com/10028029696

Tue Jul 19, 2016, 11:45 PM

Star Member SMC22307 (2,367 posts)

Anyone have experience with credit card settlement offers?
Quickie background: Friend laid off in 2012, and one card got way out of control -- around $9K. She finally landed work in 2014, and is still rebuilding. She's been bombarded by collection letters and phone calls, but the most recent agency said they'd accept about $1,300 to settle, by July 25th or 26th. I don't remember what she said about status -- delinquent or derogatory?

I know next to nil about how all of this works, I'll admit it. If she pays the $1,300, is the slate wiped clean for that card? No more hounding? How will it affect her credit score?

Thanks.

Your "friend" is a moron.

Of course much of the DUmp reaction is to screw the card company/collection agency.

Response to SMC22307 (Reply #4)

Wed Jul 20, 2016, 12:39 AM

Star Member Avalon Sparks (2,439 posts)
24. It's likely true

The junk debt collector probably paid 100 dollars for it, they'll make a profit at 1300, the original loaner wrote it off as discharged long ago...

I can guarenrte almost 99% that is not a collector that will sue based on the low amount they will settle for. They'll eventually sell it. Point is none can sue for it after 3 years...

Response to SMC22307 (Original post)

Tue Jul 19, 2016, 11:49 PM

Star Member Avalon Sparks (2,439 posts)
2. I know a lot about this

Can you tell me the state? First thing is to check statute of limitations.

Response to Avalon Sparks (Reply #2)

Wed Jul 20, 2016, 12:14 AM

Star Member SMC22307 (2,367 posts)
16. She just texted the last payment: 8/22/13.

Poor thing tried to keep up for about a year after being laid off, then gave up

Response to SMC22307 (Reply #16)

Wed Jul 20, 2016, 12:22 AM

Star Member Avalon Sparks (2,439 posts)
21. Ok

If they don't sue by that date she can walk away Scott free from ever paying it back. It may not be ethical but it is legal.

Settling by paying a portion or agreeing to pay the full amount over years will not help her credit score. I can't think of one reason to pay back a dime if it's past the SOL.

Response to SMC22307 (Reply #6)

Wed Jul 20, 2016, 12:18 AM

Star Member Avalon Sparks (2,439 posts)
18. I'm not a lawyer

But I have researched this topic throughly.

If she has not made a payment to the original lender, or any of the junk debt collectors in the last 3 years there is no legal way for the collectors to sue her for it. It seems Nc has a short statute of limitations for credit card debt. The sol is the window they can sue in. Past that, there's no legal way to collect the debt

If she made a payment that resets the sol clock

I wouldn't pay in that case. If she settles, the debt collector will report the difference to the irs and she will pay taxes on the amount that was 'forgiven'. She'll likely get a letter from the debtor around the time you get all your tax stuff in early 2017. The taxes would be around 25-25% depending on her tax bracket.

That's not why I reccomend not settling though, it's likely she may have to pay taxes on it at some point, but as the debt is passed from junk debt buyer to junk debt buyer, someone will be trying to collect on it for a long time....in that case it could be years if ever before its reported, when it is, she will likely get a letter.

But also settling won't do anything to help her credit score......and the credit collectors can't sue after the sol, if they try they would lose anyway....

Basically her choice is to settle, debt is done, gone that's it, she'll pay taxes as income on the difference.

Or just do nothing but ignore every attempt to collect, keep a record of her credit report that proves she made no payments for three years, and then wait and see if any collection reports it as dismissed.....


If u want to discuss by phone, pm your number and I'll try to explain better.

I wonder why? 

Response to SMC22307 (Original post)

Tue Jul 19, 2016, 11:53 PM

The_Casual_Observer (23,919 posts)
7. At this point the interest has stopped

So even if they pay the full amount over time they are way ahead.

You are welcome for me paying the interest you have stiffed them on.

Response to SMC22307 (Reply #12)

Wed Jul 20, 2016, 01:44 AM

footinmouth (721 posts)
40. After 7 years -

After 7 years this debt will no longer appear on her credit report. My son had a similar issue. He had several debts that were out of statute. He finally checked his credit report and sure enough, after 7 years, those debts were no longer showing on his report. All is well now, he is employed in a good paying job and owns a car and a house now. I advise not dealing with the junk debt buyer at all.

Response to SMC22307 (Original post)

Wed Jul 20, 2016, 12:14 AM

Star Member gopiscrap (13,038 posts)
15. many years ago my son ran up an 1100.00 cell phone bill

after about 8 years I got a letter from a collection agency saying they would settle for 50,00 I said I would if they would send me a paid in full invoice. They did and it di the trick.

Response to SMC22307 (Reply #17)

Wed Jul 20, 2016, 12:21 AM

Star Member gopiscrap (13,038 posts)
20. yup

I also told the collection agency a few years before that if they go after me, I will file bankruptcy in heart beat. I had cancer and other debts so my credit was shot anyway. BTW we had a talk with our son about responsible cell phone use and got him a go phone.

Your son is as big a piece of shit as you are.

Response to SMC22307 (Original post)

Wed Jul 20, 2016, 12:49 AM

Star Member cosmicone (10,998 posts)
31. If she has not use the card for >4 years

the statute of limitations to collect has run out.

Response to SMC22307 (Original post)

Wed Jul 20, 2016, 01:39 AM

Star Member winstars (2,393 posts)
39. Don't do it. They are making this offer because the SOL in NC is 3 years. THEIR time is about up.

Send Demand of Verification (DV) letter to the collection agency CMRR. (Certified Mail Return Receipt Requested) They may not even have the paper trail of the debt.

If she settles, all the lates (20/60/90/120 days overdue) that are on her credit report from the original creditor stay for the full 7 years from the last payment. It probably says account closed, sent to collection agency...which is really bad...

Now, there is a separate collection agency "baddie" on her credit report from whoever is contacting her. If she pays now, it will be there for 7 years.

The sites below have a lot of info on credit repair, there are ways to do this. Paying the junk debt collector right before the rather short SOL in NC (its 15 years in OH for a written contract, which I believe a cc is) runs out is totally NOT what to do. Its still gonna be on her credit report for 7 years. As someone else said, by paying you can "re-age" the debt, that is restart all the clocks.

One last thing, NEVER EVER TALK ON THE PHONE TO A COLLECTION AGENCY. Ever! In the first letter you send them, you state that all future communication be by mail in writing...


The sites below have all the info one needs for credit repair, which this person needs to do anyway. She can start with this scum junk debt collection agency.

Read up:

https://creditboards.com/forums/index.php?s=8e3d1882713e4b1ca6cf66485edf1c46&showforum=2

http://whychat.5u.com/index.html

The only things they can talk knowledgeably about are issues relating to getting free stuff or how to screw companies.

[USA4ME]

footinmouth

After 7 years this debt will no longer appear on her credit report. My son had a similar issue. He had several debts that were out of statute. He finally checked his credit report and sure enough, after 7 years, those debts were no longer showing on his report. All is well now, he is employed in a good paying job and owns a car and a house now. I advise not dealing with the junk debt buyer at all

Not entirely true.

If you are looking to obtain a mortgage, a lender will obtain what is called a merged credit report. A merged credit report will show your credit, both good and bad, well beyond 7 years.

Now whether your unpaid credit card debt will influence the lender is a different topic. But if you have enough of them, as I have discovered to be the case among liberals in my many years in finance, then it usually does influence their decision.

.