I have 16k debt and want to settle, I haven't missed any payments yet.. anybody have experienced doing this with amex? How many payments do I need to miss in order to get a settlement? Please help me, going through tough times and cannot afford to pay all of it. I just don't want to get sued, but would rather find out how to settle before it gets to court and them trying to garnish my paychecks...
It is a credit card, I already called them but they said we don't do settlements, they try to give me a hardship plan, 12 months for 391 dollars a month @5.9% interest. Even if I did that, i still owe a crap load. I owe Amex cc 16k and another Visa card 8k when I did a balance transfer. I know I will trash my credit if I start missing payments, but hopefully Ill be able to rebuild my credit one day, and just end up paying half of what I owe.
Debt guy is right. You will only get chance to settle just before charge off or 180 days. May around 60 or 70% they will offer
after couple years and 4 collectors , mine finally went to attorney. I pulled JAMS arb card and avoided suit. Can’t discuss details . NDA
$16,000 on one card isn't that much for 80% of households -- it does require cutting off a lot of unnecessary luxury spend though. I would suggest NOT letting it default.
Do you have cable and broadband at home? Turn it off.
Do you have Netflix/Hulu/etc? Turn them off.
Do you have an extra car? Rent it on Turo or sell it.
Do you dine out a lot or eat take-out or drive-thru? Red beans and rice for meals at home and work.
Did you buy anything on credit in the last 90 days that you can return? Return it for a refund.
Do you have an unused bedroom? List it on AirBNB.
Can you work Dolly or Uber or Instacart for 10-20 hours a week? That's up to $1000 a month extra.
Doing all of these things means you can pay down $16,000 in debt in 6-12 months.
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More info would help. Total income and debt so on
I would avoid cc companies and only consider bk if OP has much more debt and situation is much worse than we know. Amex will settle but only after he is past due for few months and maybe at 60 or70 %. I used arb with them about 4 years ago. For amount a little less. NDA so cant give details
What you are effectively asking is that they agree to cancel a portion of the debt.
In any settlement agreement, regardless of whether the account is delinquent, if they agree to a payment that is less than the current amount of the debt as discharge of the entire obligation, the difference is considered "cancelled debt" by the IRS, which they then consider to be converted to effective income that may be taxable if in the amount of $600 or more. The creditor is required to send a 1099c, which provides notice to the IRS, with copy to the consumer, of their cancellation of a portion of a debt.
Becoming delinquent is not necessary in order to offer a settlement, but they are apparently declining to actually cancel a portion of the debt, and instead are offering to modify the terms on the debt, such as deferrment of payments, reduction of minimum monthly payment, or reduction of interest rate.
That is an understandable business position on their part.
As stated in a prior post, you would need to get the creditor to modify their business decision if you wish to pursue their agreement to cancel a portion of the debt. If I were pursuing such a request, I would contact someone at their executive management level who has authority to grant exceptions to their normal business practice. Underlings likely have no discretion to grant such exceptions.