Rebuilding Your Credit

[Wonderin]

SchoolbusKid has a separate thread regarding American Collections Enterprise and in searching for whatever poop I could find on them, I found this:

Account Balance Days Since Charge-off
0-90 91-180 181-730 >730
$0-$1,500 70% 70% 50% 50%
$1,501-$3,000 70% 50% 50% 40%
>$3,000 70% 50% 40% 40%

Know what this is? Yep, you guessed it! It's Cap One's guidelines in accepting/offering settlements based on amount owed and time charged off!! This apparently regards in house charge off collection and via CA.

Hopefully, some of you guys can use this!!

[oracles]

so if you have a charge off with cap 1 for 3300 including interest (the real balance is 1500) how much will they settle for? its been charged off since 2/2004

[Wonderin]

I THINK that would be about $1324 (give or take a little bit).

My "chart" didn't post very well, and TBH, though I know HTML, I'm not in the right frame of mind to fix it at this moment. I'll fix it tomorrow, though ...

I think the main problem is that it's confusing the way that it's displayed!!!

[love2golf]

Just remember...if you settle and they forgive more than $600.00 you will get a 1099 for tax purposes.

 

[oracles]

i'm sorry, but what does that mean?

[teamfico]

oracles:

Sometimes Creditors, like Capital One use the form IRS 1099-C for a forgiveness of debt (the balance of which is not paid) when a settlement is reached.   

So say you and the creditor agree to 40% of the balance.  Then the other 60% is reported to the IRS on form 1099-C (forgiveness of debt) where you will report that as income on your IRS-1040.

[teamfico]

Capital One Settlement Guidelines:

Account Balance              Days Since Charge-off         
                                      0-90     91-180     181-730     >730

$0 - $1,500                    70%       70%          50%         50%
$1,501 - $3,000             70%       50%          50%         40%
>$3,000                           70%       50%          40%         40%

[sidewinder]

---

teamfico wrote:

oracles:

Sometimes Creditors, like Capital One use the form IRS 1099-C for a forgiveness of debt (the balance of which is not paid) when a settlement is reached.   

So say you and the creditor agree to 40% of the balance.  Then the other 60% is reported to the IRS on form 1099-C (forgiveness of debt) where you will report that as income on your IRS-1040.

---

Anytime they forgive more than $600 the IRS requires the creditor to file a form 1099C and give you a copy.

Since it is money that you got (either a cash loan or spent using a CC, etc) and you don't have to repay it, you have to include it as income and pay taxes on it.

[oracles]

thanks for the clarification, now is that including interest, because my friend has a balance owed of 1500 but because of interest, they want $3269. Is it off of the balance plus interest or just balance. Also if he settles, in ny they have a 5 year rule that it will come off if paid, but is that the same as settling. thanks

[BungalowMo]

So why won't they remove MY CO???  I paid it up in Dec 05 & my DOFD was 07/03.  Here's straight from my EQ report.

If Date of Last Payment was 8/02, wouldn't DOFD be 9/02????

CAPITAL ONE

PO Box 30281
Salt Lake City, UT-841300281
 

Account Number: XXXX                     

Current Status: CHARGE-OFF 

Account Owner: Individual Account.    

High Credit: $520  

Type of Account : Revolving

Credit Limit: $0     

Date Opened: 2000/07 

Balance: $0  

Date Reported: 05/2008 

Amount Past Due: $0 

Date of Last Payment: 08/2002 

Actual Payment Amount: $0  

Scheduled Payment Amount: $0  

Date of Last Activity: N/A

Activity Description: Paid 

Charge Off Amount: $0   

Date Closed: 12/2003 

Type of Loan: Credit Card 

Date of First Delinquency: 07/2003 

Comments: Paid charge off, Account closed by credit grantor   (Oh Really??)

81-Month Payment History

Year  Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2008   *      *      *      *                

2007   *      *      *      *      *      *     *     *     *      *      *     *

2006   *      *      *      *      *      *     *     *     *      *      *     *

2005   *      *      *      *      *      *     *     *     *      *      *     *

2004   *      *      *      *      *      *     *     *     *      *      *     *   

2003   *      *    30    60     *      *   30   60   90  120  120 CO

2002   *      *      *      *      *      *     *     *     *      *      *     *

2001                                                     *     *      *      *     *