Credit card balance Arbitration????If you know please help!!!

[Anonymous]

I got a call today from a company called thecreditvoice.com.  They were telling me every credit card customer has the right to "credit care balance arbitration", to basically settle your acct for less than the full amount.  My question is I have never heard of this before, is it damaging to your credit?  IF (and thats a big IF) I did do this would my credit report read "settled" of possibly "settled for less than full".. I  currently have pretty decent credit but I owe a total of about 15 k between 2 cards.  This company is telling me I could pay them off for a total of about 9k.  So that sounds good to me but I KNOW there has got to be a catch somewhere..OR everyone would be doing it...So if anyone has any experience with doing something like this please let me know, any and all feedback will be greatly appreciated....  Thank you

[Boswd]

You are right to be weary of them.    What they would most likely do is have the credit card company close your account and then negotiate a settlement.    It would also most likely go onto your report as as "Settled for less".   And yes it can hurt your credit picture not only score wise but when possibly on a manual review of how future lenders may look at it.

They are basically a Debt Managment Program Company.    I'm not saying either way on whether you not you want to get involved with one,  only you know you current financially picture  but as you thought there is a catch and that catch is your credit picture.

Message Edited by Boswd on 12-06-2007 11:55 AM

[SmartCookie]

The catch is that no consumer has the 'right' to settle for less.

On a defaulted account, the cc co may or may not offer to take a settlement... but yes most do once you have seriously defaulted.   But you do have to default first or they are just going to laugh at you and tell you to keep paying your bill.   

That company is a fairly new 'debt settlement organization' and most are shady even when you do need it.  They have NO idea what you could settle your debts for if you needed to and must have been enticing you off of into you provided them with.  Do not give them personal info.

They are asking you to screw up your credit so that they can make some money off of you. 

Not much of a deal if you have 'pretty decent credit'.

Call your cc co's and ask them to reduce your interest.  BT to other cards if you have good offers, or open up a new cc with a good BT promo if you can.

[SmartCookie]

And BTW if those 2 accounts you owe on are in default or closed.... this is something that you can do yourself if that scenario would give you the best results.

[Anonymous]

Hey thanks,  I appreciate your candor.. I WONT be giving them any personal info.  It is truly sad that people like this company would screw people over or help them screw themselves for 7 years for just a small amount of money. AND the salespeople they have are probably making an even smaller commission for them to lie to get people on this program is shameful......You gave me a lot of good info,  and I really appreciate that. 

You  mentioned the 2 cc accts,  they are cards weve had for 5+ years and never been late on so thank you your info and a few others my wife and I wont be making THIS mistake.  Over the last 7 years we have gone from around the mid 550's to around 690-720 depending on the bureau.  BTW do you know if  Experian and Transunion normally run higher than Equifax cause the 1st 2 are within 3 points of each other and equifax is 26 points lower than the lowest of the other two??? I hope this makes sense.

[SmartCookie]

Seems like you knew exactly what was and is going on.  Good!   You definitely don't need arbitration ... and also your cc co's Terms and Conditions might exclude a lot of 'rights'.  Arbitration and its rights are related to but still different than just 'settling for less'.

You've got 2 great TLs there that no one in their right mind would mess with.  Very nice.

All FICO scores are different on each different CRA report because the contents are never exactly identical.  I don't disagree that I think even when they might be identical, the scores seldom are.  FICOs matter, FAKO scores don't and differ from each other in the same way as well as not always being anywhere near your FICOs.

Nice score improvement though.  Stick around!