Hello-
I purchased a new car in 2009. In May of 2012, I dropped the insurance on it due to some financial hardships. The car was then totalled by my wife's friend. I made the payments on it as best I could until my financial situation got worse. I defaulted on the loan and Cap One sent it to a 3rd party. I agreed with that 3rd party company to make payments at a reduced amount through allotments out of my paycheck. We made this agreement in May of 2014. Well, the allotment paperwork had errors and the payments never reached the 3rd party.
My credit has never been great. I hover in the low 600's. I was an idiot when I was younger and I'm still paying for it. I have a low debt/income ratio (below 25%).
I received a letter from Cap One last month with a settlement offer of 15% and they will consider my account "settled for less than the full balance (i.e. settled in full)". I understand this is different than saying paid in full. The remarks in my credit report also states "Charged off as bad debt Profit and loss write-off".
With that being said, how much impact will that have on my credit? And is there any chance of them not reporting the settlement and labeling it as paid in full?
Thanks in advance.
