Come on in. Need your help and opinions.

[Cuzer]

I just want to say thanks to everyone on here who chimed in and helped me out with this. I have my check and ready to mail out tomorrow priority with a GW letter. We'll see what happens.

[Dalmus]

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@Anonymous wrote:

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@Dalmus wrote:

Wait... They sent you a 1099?  If that's true, you don't have to worry about future collection activity because you don't OWE anything.

If you got a 1099 from Cap1, that means they cancelled or "forgave" the debt, which means your credit report, while showing the negative tradeline, should show you as owing $0.

There is no point in paying, since they've already forgiven the debt, and they will not remove the chargeoff.   Paying will NOT help your credit report unless paying causes them to fix the balance owed, but they should have fixed this already when they issued the 1099.

Now, if you want to pay them because its the morally correct thing to do, that's great.

I personally would simply dispute the tradeline, including a copy of the 1099 as proof.

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Actually, case law is split on whether the balance must be zeroed out when its 1099'd. BoA and many others will not zero it out, arguing that the 1099 is only an IRS formality, and does not discharge the debt.

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 Interesting...   Not that I want to go researching case law, but I wonder how they can counter the argument that the IRS says the person receiving the 1099 is the legal owner of that amount and has to pay taxes on it.  And the original creditor forfeits its rights to collect on the amount shown on the 1099.

 I suppose it depends on the judge hearing such a case.  Some judges are creditor friendly, some are debtor friendly.

[grillandwinemaster]

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@Dalmus wrote:

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@Anonymous wrote:

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@Dalmus wrote:

Wait... They sent you a 1099?  If that's true, you don't have to worry about future collection activity because you don't OWE anything.

If you got a 1099 from Cap1, that means they cancelled or "forgave" the debt, which means your credit report, while showing the negative tradeline, should show you as owing $0.

There is no point in paying, since they've already forgiven the debt, and they will not remove the chargeoff.   Paying will NOT help your credit report unless paying causes them to fix the balance owed, but they should have fixed this already when they issued the 1099.

Now, if you want to pay them because its the morally correct thing to do, that's great.

I personally would simply dispute the tradeline, including a copy of the 1099 as proof.

---

Actually, case law is split on whether the balance must be zeroed out when its 1099'd. BoA and many others will not zero it out, arguing that the 1099 is only an IRS formality, and does not discharge the debt.

---

 Interesting...   Not that I want to go researching case law, but I wonder how they can counter the argument that the IRS says the person receiving the 1099 is the legal owner of that amount and has to pay taxes on it.  And the original creditor forfeits its rights to collect on the amount shown on the 1099.

 I suppose it depends on the judge hearing such a case.  Some judges are creditor friendly, some are debtor friendly.

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Does a 1099 prevent the original creditor from assigning ore selling to a collection agency?? 

I'm not sure this is the case. From my experience with cap1, I would pay to avoid a collection account appearing on my credit report. The OP said he has the means to pay. The peace of mind alone is worth the effort. 

I say pay it and turn the page on this chapter in your life. 

[Cuzer]

Hey everyone, So a quick update here. Capital One received my certified check and the whole thing paid in full on the old account. I sent the check with a GW letter but they have sent back a letter saying they will continue to report the closed charged off account. Ok fine, however in the letter it claims that they will make a remark on my Credit Report with "Disagreement code, Resolution of dispute".

I do not quite understand that as i was not trying to dispute anything, Just asking for a removal on a GW on their part.  Can anyone with experience comment on this?  Much appreciated.  Thank you.