How do I make the most of these two debt settlements?

[ChuckG]

I've finally saved up enough money to get these 2 old debts off my chest. One is a CC balance with a CA for $12000 and the other is a car loan with a law office representing the original creditor for $4000.

In both cases I sent multiple PFD offers, all of which were ignored.

Today with money in hand I called both up to try and strike my best deal. I got the Attorney to refrain from filing the lawsuit if I agree to pay in full by Feb 1. It'll be reported as paid in full and the title mailed to me. No luck deleting. The CA is willing to accept a payment of $6600 (55%) to mark the account as paid in full. Again no chance of a delete.

Both debts are legitimate as these are accounts I let fall by the wayside when I was laid off. I always planned on paying them off and now it finally seems I can. I've requested both settlement offers in writing before I pay anything but I wanted to see if the experts here had any advice since I want my credit to be in the best shape possible after I've forked over all this cash.

Thanks in advance!

[Rain77]

IME, PFD only worked if the debt is PIF, not settled.  This could be why they are not excepting, or they just do not do PFD's. 

[ChuckG]

The PFD's I offered were for the full amount.

Not surprised the lawyer wouldn't take it since they didn't sell the debt. The CA (Asset Acceptance) surprised me though. I figured they would do that for an extra $6k

[RobertEG]

I presume that you have researched your state statute of limitations, and that both debts are still within its period for commencement of civil action.

I would suggest that, at a minimum, you obtain specific agreement not to make any reporting, such as that of a special comment, that the debt was settled for less.

Credit reporting requires satisfied debt to be reported only as paid, not the circumstances of its satisfaction.

When the debt is satisfied, the creditor is required to update their reporting to $0 debt due. and a debt collector is required to update the collection balance to $0.

If they are the same party, then the OC should already have updated to $0 when the debt was sold.

So the debt will be reported as paid, regardless of the amount they accept as its satisfaction.  If a debt is satisfied for less than the total obligation, the party has the option of additionally reporting a special comment of paid for less, thus placing in your file for review by others of that fact. 

I would get explicit agreement not to make any such reporting.  The satisified debt will then appear to anyone reading your credit report the same as if paid in full.

[ChuckG]

That is good advice, thank you. I will make sure to do that.

[ChuckG]

Update:

I just realized that the personal loan ($4k) is showing as charged off by the OC but the Attorney who now (owns?, has? represents?) the debt and is threatening to sue me for it, has not reported anything to the CRAs.

In this case can I even do a PFD? Will he be able to have the OC update their entry as paid in full? The total outstanding debt on my credit report doesn't even list the 4k.

What to do?

[Shogun]

No, he will not be able to have the OC do anything other then mark the debt as paid.  You will need to start the GW process after it has been satisfied.