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heathergirl
Cocktail Time!
Member since 10/08 4978 total posts
Name:
American mouth
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CC debt credit question
My best friend just called me and told me that a CC she had fallen behind in for a long time had offerd a settlement of $1100 in 3 payment (she had $2400 owed). I had no idea if this was a good idea or not or if it affects her credit negatively. The settlement was through the CC company, not a third party if that makes a difference. She has until the 29th to make the first payment. Is this a bad idea? She says there's no way she can pay back the total amount. IDK what to tell her, and Googling it gives me lots of mixed responses. TIA 
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Posted 11/14/08 10:45 AM  |
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pinkandblue
Our family is complete, maybe
Member since 9/05 32436 total posts
Name:
Stephanie
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Re: CC debt credit question
it will affect her credit but if she has no other choice, it is better than not paying it at all
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| Posted 11/14/08 10:55 AM |
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SnickNNick
In our new house!!
Member since 8/08 2119 total posts
Name:
Nicole
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Re: CC debt credit question
I really don't know, but just for clarification, is it 3 payments of $1100, or 3 payments totaling $1100? I'm guessing totaling $1100, but I don't see why the company would do this....?
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| Posted 11/14/08 10:56 AM |
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pinkandblue
Our family is complete, maybe
Member since 9/05 32436 total posts
Name:
Stephanie
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Re: CC debt credit question
Posted by SnickNNick
I really don't know, but just for clarification, is it 3 payments of $1100, or 3 payments totaling $1100? I'm guessing totaling $1100, but I don't see why the company would do this....?
because the company would rather have SOME money than no money
CC do this all the time with people who cannot make payments
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| Posted 11/14/08 10:57 AM |
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heathergirl
Cocktail Time!
Member since 10/08 4978 total posts
Name:
American mouth
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Re: CC debt credit question
Posted by Mikismom
it will affect her credit but if she has no other choice, it is better than not paying it at all
I told her it can't be any worse than it is now. True, they'd rather have some money than none.
I asked my BIL and he said its pretty standard among CC's to do this.
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| Posted 11/14/08 10:59 AM |
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JenMarie
One day at a time
Member since 11/07 7397 total posts
Name:
Jennifer
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Re: CC debt credit question
This is a common offer CC companies will offer those who are not paying their bill. It DOES affect her credit. It will show on her credit report that she settled on the amount. This is a negative thing in the eyes of a future creditor.
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| Posted 11/14/08 11:13 AM |
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MrsRivera
2 under 2...whew!!
Member since 2/07 9876 total posts
Name:
Beth
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Re: CC debt credit question
Actually, Suze Orman just did a spot about this on her show. There are a few ways that she can actually get around it negatively affecting her credit.
In order for it to be beneficial for HER, she'd have to make one lump sum payment. She would have to call and say "I'm ready to make a payment now of X" and be ready to pay that amount. She also needs to have fallen at least 3 months behind on her payments.
She can work out an agreement with the credit card for them to guarantee her that it will read "balance paid in full" on her credit report. If she doesn't explicitly state this, they can say that she defaulted on the amount, and that's what she DOESN'T want.
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| Posted 11/14/08 11:20 AM |
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bigspender
Back to school
Member since 4/07 1385 total posts
Name:
Irene
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Re: CC debt credit question
Posted by Jennifer907
This is a common offer CC companies will offer those who are not paying their bill. It DOES affect her credit. It will show on her credit report that she settled on the amount. This is a negative thing in the eyes of a future creditor.
It stays on your record for a long time. It is better than not paying at all but I would really try to pay them off without having to do this. I did this years ago and it took 7 years to come off my credit report. I would never do it again.
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| Posted 11/14/08 11:23 AM |
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LoveyQ
Stalkers, get a life.
Member since 11/07 12820 total posts
Name:
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Re: CC debt credit question
Yes, apparently this is common - I have two friends who in college got into a lot of debt with credit cards and defaulted on that debt - a few of their credit card companies offered them reduced amounts to close off their accounts (CONSIDERABLY reduced amounts) and they took them, but it did affect their credit negatively.
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| Posted 11/14/08 11:28 AM |
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MrsFab
this is bliss.......
Member since 10/08 1234 total posts
Name:
Mb
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Re: CC debt credit question
Posted by MrsRivera
Actually, Suze Orman just did a spot about this on her show. There are a few ways that she can actually get around it negatively affecting her credit.
In order for it to be beneficial for HER, she'd have to make one lump sum payment. She would have to call and say "I'm ready to make a payment now of X" and be ready to pay that amount. She also needs to have fallen at least 3 months behind on her payments.
She can work out an agreement with the credit card for them to guarantee her that it will read "balance paid in full" on her credit report. If she doesn't explicitly state this, they can say that she defaulted on the amount, and that's what she DOESN'T want.
thats great advice- but I would also say that she should get everything in writing- that way if something negative shows up she can just forward it to the credit bureaus as proof and they will remove it
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| Posted 11/14/08 11:29 AM |
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