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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Paying a Credit Card off & lowering what is owed?
My Aunt is in about $20,000 debt. She sold her house and is now in a mobile home.
She is using the money she got from the house to pay off the credit cards.
Now she only has a certain amount to use.
Is there a way to call the credit cards and try and get the amount owed down?
If so, how does she go about wording it so they will?
TIA
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Posted 8/13/08 1:05 PM  |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
Posted by 5ofClubs
My Aunt is in about $20,000 debt. She sold her house and is now in a mobile home.
She is using the money she got from the house to pay off the credit cards.
Now she only has a certain amount to use.
Is there a way to call the credit cards and try and get the amount owed down?
If so, how does she go about wording it so they will?
TIA
I am not sure what you are trying to do here. You said she is paying the credit cards, but she is trying to get the amount owed down?
What do you mean getting the amount owed down? When you make payments the amount you owe naturally goes down.
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| Posted 8/13/08 1:06 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Paying a Credit Card off & lowering what is owed?
Posted by ave1024
Posted by 5ofClubs
My Aunt is in about $20,000 debt. She sold her house and is now in a mobile home.
She is using the money she got from the house to pay off the credit cards.
Now she only has a certain amount to use.
Is there a way to call the credit cards and try and get the amount owed down?
If so, how does she go about wording it so they will?
TIA
I am not sure what you are trying to do here. You said she is paying the credit cards, but she is trying to get the amount owed down?
What do you mean getting the amount owed down? When you make payments the amount you owe naturally goes down.
She wants to pay them off. She hasn't been able to pay them in a few months. Not even the min and she was told by someone that you can try and call them and get the balance lowered if you tell them this is all you have.
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| Posted 8/13/08 1:07 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
Posted by 5ofClubs
She wants to pay them off. She hasn't been able to pay them in a few months. Not even the min and she was told by someone that you can try and call them and get the balance lowered if you tell them this is all you have.
They are not going to negotiate balances with you until she has missed a number of payments in a row.
And by that time her credit would be trashed.
You can't just easily get credit card debt waived.
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| Posted 8/13/08 1:09 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Paying a Credit Card off & lowering what is owed?
Posted by ave1024
Posted by 5ofClubs
She wants to pay them off. She hasn't been able to pay them in a few months. Not even the min and she was told by someone that you can try and call them and get the balance lowered if you tell them this is all you have.
They are not going to negotiate balances with you until she has missed a number of payments in a row.
And by that time her credit would be trashed.
You can't just easily get credit card debt waived.
But do you think she should even try? She is not looking for it to be dissolved just lowered. It has been months in a row. She is not worried about her credit at this point.
Message edited 8/13/2008 1:10:58 PM.
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| Posted 8/13/08 1:10 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
Posted by 5ofClubs
But do you think she should even try? She is not looking for it to be dissolved just lowered. It has been months in a row. She is not worried about her credit at this point.
Doesn't hurt to call and ask. Has she definitely missed multiple payments?
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| Posted 8/13/08 1:12 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Paying a Credit Card off & lowering what is owed?
Posted by ave1024
Posted by 5ofClubs
But do you think she should even try? She is not looking for it to be dissolved just lowered. It has been months in a row. She is not worried about her credit at this point.
Doesn't hurt to call and ask. Has she definitely missed multiple payments?
Definitely.
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| Posted 8/13/08 1:13 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
She would have to call and have the CSR transfer her to somebody in credit management (department). The people in credit management are probably the only people that have the authority to do stuff like that.
Explain the story and see what they say.
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| Posted 8/13/08 1:15 PM |
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TheWhiteRabbit
Thru the rabbit hole!
Member since 7/06 4412 total posts
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Re: Paying a Credit Card off & lowering what is owed?
You can settle with credit cards where they take a certain percentage of what you owe if you'll pay it off in full.
My friend did this using a company. They settled her $24,000 amex bill for $12,000. They charged her 5 or 10% fee of what they saved her. FM me if you want their info.
Just remember, she will get a 1099-C – cancellation of debt for the amount of debt the CC company writes off. This is considered income and she will have to pay income tax on it.
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| Posted 8/13/08 1:21 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
Posted by KittyTheStray
Just remember, she will get a 1099-C – cancellation of debt for the amount of debt the CC company writes off. This is considered income and she will have to pay income tax on it.
Excellent point as I forgot about the tax implications. Easy way is to just multiply the amount you "saved" by .20 (average tax bracket) and that's how much you will have to pay in taxes.
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| Posted 8/13/08 1:25 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Paying a Credit Card off & lowering what is owed?
Posted by KittyTheStray
You can settle with credit cards where they take a certain percentage of what you owe if you'll pay it off in full.
My friend did this using a company. They settled her $24,000 amex bill for $12,000. They charged her 5 or 10% fee of what they saved her. FM me if you want their info.
Just remember, she will get a 1099-C – cancellation of debt for the amount of debt the CC company writes off. This is considered income and she will have to pay income tax on it.
Thank you very much. I will tell her about this. Seems like she might be better off just paying what she really owes.
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| Posted 8/13/08 1:29 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
Posted by 5ofClubs
Thank you very much. I will tell her about this. Seems like she might be better off just paying what she really owes.
Definitely. 20k really isn't a lot when you are talking about serious debt.
I would say if she owed 50k or more, maybe.
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| Posted 8/13/08 1:33 PM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
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Beth
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Re: Paying a Credit Card off & lowering what is owed?
and the implication to her credit report- you are saying she doesn't care
but she should
all of these debts will appear as charge offs
not good
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| Posted 8/13/08 2:51 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
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Re: Paying a Credit Card off & lowering what is owed?
Posted by Beth1210
and the implication to her credit report- you are saying she doesn't care
but she should
all of these debts will appear as charge offs
not good
Wait so it is better then for her to pay them in full? This will look better then "haggling"? Both are bad but one is worse then the other?
I am so confused. I should have her speak to a financial person or something
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| Posted 8/13/08 2:54 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
Posted by 5ofClubs
Posted by Beth1210
and the implication to her credit report- you are saying she doesn't care
but she should
all of these debts will appear as charge offs
not good
Wait so it is better then for her to pay them in full? This will look better then "haggling"? Both are bad but one is worse then the other?
I am so confused. I should have her speak to a financial person or something
Missing payments will ding your credit report as they will show either 30 60 90 or 120 underneath the account on the credit report. That is bad.
Sounds like she already has this as you said she missed payments.
Negotiating the balance down like Beth said is also bad. It's bad IN ADDITION to the missed payments.
So it's just adding on to the problem. You have to get a copy of her credit report and her scores. If her scores are still in the mid 600s, I would try to get the payments being made again. At least make the minimums. This will improve her credit. If she can pay them off, even better.
I wouldn't accept a chargeoff or negotiation on the balance unless her scores are completely tanked. Like low 600s or less. Then it really doesn't matter if she has an additional negative with the chargeoff because the credit report would already be trashed. Only time and on time payments will correct that.
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| Posted 8/13/08 3:00 PM |
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LIMOMx2
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Member since 5/05 24989 total posts
Name:
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Re: Paying a Credit Card off & lowering what is owed?
Thank you. That is very helpful!!
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| Posted 8/13/08 3:01 PM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: Paying a Credit Card off & lowering what is owed?
Posted by 5ofClubs
Wait so it is better then for her to pay them in full? This will look better then "haggling"? Both are bad but one is worse then the other?
I am so confused. I should have her speak to a financial person or something
of course it's better to pay them in full
but she already missed payments- so her credit is a mess
once you are 90 days late- your score is in the toliet
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| Posted 8/13/08 3:02 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: Paying a Credit Card off & lowering what is owed?
She doesn't have to pay it off completely to improve her credit. Just start making your payments on time and her credit will improve over time.
Time is the best cure for crappy credit.
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| Posted 8/13/08 3:03 PM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: Paying a Credit Card off & lowering what is owed?
and if she has been on time with a car payment - that will help keep her score from falling too far
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| Posted 8/13/08 3:07 PM |
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