I'm not sure if I'm on the right board for this topic, but here it goes...
I did something really stupid, but I didn't know what else to do. I have a family friend that I grew up with who's like a sister to me. She was in a bind, a really bad one, and I let her use $1k on my card to pay something off for her. She told me she would pay at least $100 a month until it was paid off. I had no reason not to trust her. This was in June.
I got into my own financial problems, and my credit cards actually helped me put food on the table. We maxed out some cards, but everything for my family is getting better. My credit score is hurting, but I have a plan and things should get better by the spring.
She was paying until September, when she was in the hospital. She's in her 30's and is having major heart surgery next month. I didn't realize that she wasn't paying until today. Since I'm having problems myself, the card that I let her used slipped through the cracks. I texted her on the due date (12/1/14) and asked if she paid. She said she would pay that Friday. So I let it go those few days. She can pay the late charge.
When I actually logged into my account, I realized that she hasn't been paying. Last payment was September. So I asked her today to pay it. She said something about the banks being closed and she would ask her husband to pay it, blah, blah, blah. I went ahead and made a payment today.
I told her I made the payment and kindly asked her to let me know if she can't make the payment by the due date. Of course, she promised to. Then she got into her health issues, saying that she may have to move out of her apartment because she's going to be out of work for more than a month.
What's hurting is that OCCU reported the 30 day late. It's my first derog since I improved my credit last year. Things were going so well. We bought a house last September, and since then, DH and I have been approved for prime cards. He was out of work for 3 months due to an injury, and didn't get paid for those 3 months until 5 months later. So that was our issue. Otherwise, we're doing okay financially.
My question is... should I just close that account? I don't have the funds right now to pay it off, especially since it's Christmas season. The $1k limit is my lowest limit card, and although my utilization will go up, it won't go up that much. I asked my friend to pay it off by February. She said yes, but we'll see. She does have my credit card information and can access my account online. If I don't close my account, I was going to pay it off in March if she hasn't. Then report my card as lost, so I don't keep the same account number.
Any suggestions what I should do about the credit card would help. I really don't want to hear criticism on the situation. I already know what I should have done. Shoot me now.
@longtimelurker wrote:
@Ravensfan2001 wrote:I'm not sure if I'm on the right board for this topic, but here it goes...
I did something really stupid, but I didn't know what else to do. I have a family friend that I grew up with who's like a sister to me. She was in a bind, a really bad one, and I let her use $1k on my card to pay something off for her. She told me she would pay at least $100 a month until it was paid off. I had no reason not to trust her. This was in June.
I got into my own financial problems, and my credit cards actually helped me put food on the table. We maxed out some cards, but everything for my family is getting better. My credit score is hurting, but I have a plan and things should get better by the spring.
She was paying until September, when she was in the hospital. She's in her 30's and is having major heart surgery next month. I didn't realize that she wasn't paying until today. Since I'm having problems myself, the card that I let her used slipped through the cracks. I texted her on the due date (12/1/14) and asked if she paid. She said she would pay that Friday. So I let it go those few days. She can pay the late charge.
When I actually logged into my account, I realized that she hasn't been paying. Last payment was September. So I asked her today to pay it. She said something about the banks being closed and she would ask her husband to pay it, blah, blah, blah. I went ahead and made a payment today.
I told her I made the payment and kindly asked her to let me know if she can't make the payment by the due date. Of course, she promised to. Then she got into her health issues, saying that she may have to move out of her apartment because she's going to be out of work for more than a month.
What's hurting is that OCCU reported the 30 day late. It's my first derog since I improved my credit last year. Things were going so well. We bought a house last September, and since then, DH and I have been approved for prime cards. He was out of work for 3 months due to an injury, and didn't get paid for those 3 months until 5 months later. So that was our issue. Otherwise, we're doing okay financially.
My question is... should I just close that account? I don't have the funds right now to pay it off, especially since it's Christmas season. The $1k limit is my lowest limit card, and although my utilization will go up, it won't go up that much. I asked my friend to pay it off by February. She said yes, but we'll see. She does have my credit card information and can access my account online. If I don't close my account, I was going to pay it off in March if she hasn't. Then report my card as lost, so I don't keep the same account number.
Any suggestions what I should do about the credit card would help. I really don't want to hear criticism on the situation. I already know what I should have done. Shoot me now.
What do you hope to gain by closing it? Closing it with an outstanding balance might impact your score, as you lose the CL but keep the balance. Are you concerned that she might make more charges (as her situation sounds pretty bad)? First off, I would change your password online, so she no longer has access, and ask her to pay you directly (then you would quickly know whether things are getting paid or not.) If you think she might charge more, tell the ccc that the information has been compromised (or card lost if you find that easier) and get a new number.
I don't even know what I want to do. I'm just so mad that it's reported on my credit. I'm mad at my friend for not paying on time. And I'm mad at myself for letting her use the card.
I was researching OCCU, and it looks like they don't respond well to GW letters. I'm going to try it, anyway, but I want the balance paid off first.
Sorry to hear about all the difficulties.
A framing statement first: Any personal loan you make to friends or family should be considered "lost money", you must enter the agreement prepared to lose that money and never see it again, and any repayment is a bonus. Otherwise you damage the relationship when things like this go sideways. Having stated my opinion, you owe the $1,000 (or current balance) to OCCU. Just own it.
Next, close the account. It is your lowest limit account, you obviously are not using the card, and to prevent any new charges, close it now. Your friend may get the urge to whip out the plastic "just one more time" and there you go.
You will not lose any of the credit history by closing it. I have two closed accounts with balances, I closed them because the CCC changed the interest rate terms and I had permanent rates which I found useful, so told them to close the account, I will pay it off according to the existing terms. These accounts still are on my credit report as closed, with the old limits and current balances. The CCC can do some CLD the available "credit line", but my experience is that they keep the CL high enough that your apparent utilization is not too bad, but more importantly they will prevent any new charges from being made to add to the open balance. That is what you should do, in an actual hard copy letter sent to the OCCU offices. Not a phone call, not an email, a letter. Old school.
Next, start moving your budget around to start paying down this $1,000 on your own. Christmas? what's that? It just became low priority. Sorry, thems the facts.
You want to work through this to maintain YOUR credit, and try to get some payment out of your friend, but given her situation, that seems like not a reasonable expectation, thus my recommendation that you just own the debt now.
Good luck!
reporting it lost confuses the situation too much. OP knows exactly where the card is.
In general, one does not want to close a card just on a whim. This is a situation that calls for closing the card completely. You then get the CU on your side to prevent any new charges, prevent any "My friend gave me this card and now it doesn't work" issues later.
My opinion.