Business Line of Credit & Personal Guarantee

Anonymous · ‎03-31-2010

Hello,

I am hoping someone can help me. I had (3) Business Lines of Credit established (2) years ago ties to a Nevada LLC. We had (2) Managing Members, one of which was myself, and the other a partner who suffered a stroke. We were forced to disolve the LLC after my partner's Medical condition worsened. With this came the reality of attempting to work with the Creditors to negotiate the outstanding debt down to a manageable payoff as my source of income was lost. In all 3 cases negotiations were established and I paid the amount in full the Creditors will willing to accept, however, the entire balance now shows on my credit profile as a complete chargeoff as opposed to settled for an agreed amount. I am hoping someone here may have some advice as to what I can do to help my cause as there is no notation whatsoever in regards to the amounts I paid. Also, I have (1) additional account that has been turned over to a CA and the lender has already listed this account as a chargeoff so should I even attempt to negotiate with these people? Any help would be greatly appreciated as I hope someone may have some experience with this type of situation.

QueenBean · ‎04-08-2010

I'm sorry that this happened to you - it's not fun.

These accounts should be showing as a Charge Off with a zero balance. The note should say 'settled for less than amount owed' or something to that effect. It will stay on your credit for 7 years.

My advice to you is that you contact these companies and make sure that they issue the 1099s in the name of the LLC, and not in your personal name, or you will have to personally claim the amount that they charged off as income to the IRS - (nothing like kicking you when you're down).

Good Luck

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Anonymous · ‎04-08-2010

Thanks for your response! These were business lines of credit and only (1) sent me a 1099 in the LLC name. Are you aware of any legitimate way of correcting this with a straight forward approach or should I just dispute with the credit bureaus? Any additional help would be greatly appreciated and Thanks again!

Jazzzy · ‎04-10-2010

@Anonymous wrote:
Hello,

I am hoping someone can help me. I had (3) Business Lines of Credit established (2) years ago ties to a Nevada LLC. We had (2) Managing Members, one of which was myself, and the other a partner who suffered a stroke. We were forced to disolve the LLC after my partner's Medical condition worsened. With this came the reality of attempting to work with the Creditors to negotiate the outstanding debt down to a manageable payoff as my source of income was lost. In all 3 cases negotiations were established and I paid the amount in full the Creditors will willing to accept, however, the entire balance now shows on my credit profile as a complete chargeoff as opposed to settled for an agreed amount. I am hoping someone here may have some advice as to what I can do to help my cause as there is no notation whatsoever in regards to the amounts I paid. Also, I have (1) additional account that has been turned over to a CA and the lender has already listed this account as a chargeoff so should I even attempt to negotiate with these people? Any help would be greatly appreciated as I hope someone may have some experience with this type of situation.

Hi fastdialer, and welcome to the forums. It's unfortunate that this happened. Cleaning up the mess isn't fun.

There is still some hope with this additional account that you could get it off of your report as a collection account. That won't change the charge-off from the original creditor, but it might save you the collection account reporting.

Have you been contacted by the collection agency? If you are willing to pay some or all of this, you could offer them a pay for delete (PFD). Do some reading in the Rebuilding Your Credit forum about pay for deletes. That is where you offer to pay the collection agency ONLY if they agree to delete the reporting from your credit report. You need to negotiate this in writing and have an agreement in your hands BEFORE you pay them anything.

As to the misreporting on the other charge-offs, I would dispute the reporting on these with the credit reporting agencies. It's bad enough that it happened...they certainly don't need to be making it worse than it is. Don't dispute to have the accounts removed. Just dispute what the reporting says.