Please HELP!!! Ways to pay a "Charge Off" - or is it really a "Charge Off"

[KelliTPA]

So, I've been on here for hours and hours reading about what steps to take on my last negative account with a balance.  On my credit report, First Premier is still reporting the balance, and my CR is showing that they reported in August.  So that means they still own it - right?  My balance is only $770, and I can PIF. 

I sent a backdoor email to First Premier stating I wanted to PFD and I got a response from the President's Office of First Premier stating:

"This account was set up for you on November 22, 2006. On February 29, 2008, this account charged off with a balance of $770.37. This account is currently being serviced by Genesis Financial Solutions (GFS). Please contact them directly to make payment arrangements on this account at:"

There was a lot more to the email, but this is the part that concerns me.  First Premier says they can't take payment when I call because it is "charged off."   At this point, I'm not even concerned about getting it deleted, I just want the balance gone so that my score will increase.  I am trying to purchase a car and need to increase my score just slightly in order to qualify for the rate I want.

I was going to just send payment directly to First Premier anyway to see if they would apply the payment towards my account.  But I'm concerned that they might just send the payment back and not apply it to my account and I don't want to waste 30-60 days. No other CA has ever reported it.  I contacted Genesis and they said the collection is being handled by NCO, and that I would have to pay them.  My biggest concern is that by paying the CA that has been assigned to the account, they will start to report it, causing First Premier to begin reporting as a Charge Off.  Then, my credit would be shot with the 2 new negative updates (one for the CO from First Premier and one from the CA).  Would this happen if I paid the CA?  If First Premier states they charged off the account in Feb-08, they wouldn't be able to still report a balance - right?  What does it mean if it is "assigned" to a collection agency vs. being "sold" to a CA?  If I pay the CA, can First Premier charge off the account to the CA after I make payment to the CA?

My next question is in regards to the same account.  I received a letter from Peal Master Card today stating the following:

"Genesis Financial Solutions (GFS) would like to help you resolve your financial obligation AND get you on your way to rebuilding a strong payment record. 

Once you accept this unique credit card offer and make an inital payment to your new Peal Card Gold MasterCard account, you charged-off First Premier Bank Account (with a total balance of $770.37) owned by First Premier Bank, will be considered resolved."

This is basically an offer for a new credit card.  They will put my balance of my First Premier card on the new card, and I can make payments to pay this down if I want, or I can PIF.  The balance of $770 will have 0% interest as long as I make the monthly payment of $35.  And, as I pay down the balance, they provide me with an increasing credit line.

I believe this letter confirms that First Premier does still own the account, because they state it in the letter.  I called the company and asked if they are a normal credit card company.  The man stated that they send offers to people to allow them to rebuild their credit.  He said that if I agree to the offer, they purchase my account from the creditor, and begin reporting to the credit bureaus my new credit card information.  Has anyone done this before?  I am worried if  I choose this option, they will purchase the old debt for pennies on the dollar because I agree to pay the balance in full, and then the OC, First Premier, will report the account as a CO because they sell it.

Any help anyone can provide would be great.  I am so confused as to how to handle this last account without damaging my score.  Please help!!!

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[Anonymous]

Well this is the second time i have written this response. Got deleted by me by accidentally hitting tab and then backspace.

Let me start off by saying that any information that I provide is in by now means advice on how to proceed with YOUR credit repair.

Here are your options:

1) send your payment as you had initially planned. Chances are they will apply it towards your account. If they don't you will usually know within a couple weeks. Send a check and check to see if and when it clears a go to the bank and request a copy of your statement and have someone from your bank that is authorized to sign documents sign it for you showing that the payment cleared if any problems arise such as them cashing the check and not applying it to your balance.

2) Wait to get a dunning letter from the CURRENT CA collecting on the debt. Then dipute it the same day that you receive it. There is no need to send a fancy letter all covered up with legal mumbo jumbo. All that you need to do is state clearly that you are dipusting this debt and you are in no way admitting that it belongs to you. Just that you would like verification. Chances are they can't or don't want to send you verification. If they havent reported the debt to the CRA's yet and you have received a dunning letter from them it is imperative that you get the DV letter to the CA asap. The DV letter will legally prevent them from reporting on your credit if it has not been done so because if you file a dispute they have to cease collections until an investigation has be carried out. Reporting to the CRA's is a form of debt collection which is against the FDCPA if the debt is in dispute. Once they have signed for the DV letter send them another letter. This one is kind of a PFD but not exactly. This only works if they have received your dispute before they reported it to the CRA's. Promptly send a letter stating that if you pay the account in full they shall not proceed with any further debt collection activities and this includes reporting to the CRA's. Provide them a fax number if you want quick resolution or wait for them to respond with their letter accepting your terms. I dont know if this could work for you but it has worked for me 6 times straight. I called them and never confirmed that I owed the debt or that I will "promise payment" I simply said that if I receive the promised letter I will send certified funds via CMRRR. I usually got the letter within the hour. Only one did I have to wait till the next day to get because "someone else had to type it up for them".  I never once admitted it was mine as they tried desperately to get me to say that I acknowledged it was mine. Only call them if you know what you are going to say and never admit to anything as this can sometimes cause the SOL to start over.

3) Your last option is to just pay the CA and accept a "Paid in full/Settled" TL on the debt. Granted this is your least favorable option sometimes it may be your only option.

4) You can do a PFD but contrary to want everyone says it doesn't "always" work. It may have worked for them once or twice or maybe even three or more times but it all depends on whether or not you can make the situation a win win for both parties.

I might have gotten a little off track but you get the idea. Try to go to the OC first. If that doesn't work try #2, if that doesn't work #3, if that doesn't work try #4. You can also do #4 as many times as you wish.

Just know that this is not a quick fix. This one debt could take you 3 days or 3 months to resolve. Just depends on your situation. Everyone wants everything done overnight and that is just not simply possible with credit related items. It will take some time but don't give up. You will eventually get this taken care of.

Obviously you now are taking great pride in maintaining a better credit history so unless you are carless and walking everywhere I would put off your new purchase off until you can get this issue taken care of. The longer you wait....The better the rate!!

Good Luck

[KelliTPA]

Thanks for the info Steven.  If I send a DV letter, which CA should I send it to?  First Premier said to contact Genesis and when I called Genesis, they said it was being handled by NCO.  Neither company has sent me a dunning letter.  I assumed it is because First Premier still owns it. 

I thought that a CA only needs to respond to a DV letter if it is within the first 30 days (your period for the dunning letter).  So you are saying if I send payment directly to First Premier and send a DV letter to the CA, and then First Premier processes the payment that the CA should never be able to report it to the CRAs?

[Anonymous]

You should find out first who you need to make payment to. That will be the CA that is trying to collect the debt. If you haven't checked your credit since all this happened I would suggest doing so first. Find the last creditor to post something for the debt and them give them a call. I wouldn't worry to much about SOL as this sounds like this is a current debt that was recently charged off. Ask them to provide some basic info over the phone regarding the debt. (OC, FDOD, address of OC, get as much as you can out of them but mostly those three) remember the golden rule too as this will take you far not only in life but with CA's as well. Remeber that they are people to and they are just doing there job. If yo uare curteous to them you will get the same in return. If they refer you to another CA just keep at it. You WILL eventually get the current creditor. If they tell you that they have sold it to another CA and don't have this information it is bull honky but of course just agree with them and ask to speak with their manager as there is nothing further that that representative can help you with. Ask the manager who you would speak to about who pruchased your debt. They have to release this information no different than if you were to ask the OC who purchased the debt in the first place. They will sometimes give you a bogus number so ask for a physical address and the CA name at least and stay by a computer and search the BBB website as they usually have the most current information about the company that potentially has your account. Chances are NCO is the current CA but follow the trail from where it started if you can't get a straight answer from anyone. I can stress this enough but be as polite and nice as you can. Sometimes CA's try to bully you into paying but this is also against the law. Don't get tangled up in the threatening to sue sharade unless you have exhausted all efforts in trying to resolve this issue. Sometimes it can help persaude a CA to do things your way if you know without a doubt you have evidence that gives cause to sue.

I don't and will not offer advice but I will always share my experiences that I have been through in the past 2 years of repairing my credit. It takes patience and persistence. If they give you the runaround... Go around. By this I mean go over their head. Always try to get the next person in charge of the last one. This may only take a couple of letters or calls but you will eventually get your asnwer or resolution.

As far as the DV letter goes, I keep everything in a two three ring binders. One binder for originals and one is copies in case something happens to the first. Keep the copies somewhere safe. You dont have to go as far as a safety deposit box but something animal or kid proof helps. In the first couple of months I was at this credit repair stuff my 8 month old puppy decided to use my credit binder as a chew toy. Thankfully nothing was lost or damaged but after that I started keeping a seperate binder just for copies in the top of my closet out of sight from everything and everyone.

Keep good records and I mean good. The reason why is you might be able to catch the CA violating the law which gives you leverage in getting the item removed much much easier. Leverage is a good thing. Don't misconstrue this as threatening. Never let them know until you have good hard evidence and then they will bend over backwards to make YOU go away. I had a charge of settled for 10% a few months ago because I caught them in violation of the FDCPA and after I had proof and a recording of our conversation that I informed them of before recording them. I informed them that I had undeniable proof that they violated the law and unless they accepted my offer I would proceed to file a civil lawsuit against them and get as much money in damages as legally allowed. Long story short that was about a 5 minute phone call mostly of which I was on hold for the manager and once I informed him he accepted my offer, made a three way call at my request to their reporting department (can't remember what he called it now) and they removed it from my credit within 24 hours and I made payment as soon as it disappeared. Never heard from them again other than a letter from the company Im assuming president stating that they have no knowledge or record that I have every had an outstanding debt with them and They are deeply sorry that they have put me through such emotional distress. It gets better. At the end of the letter he offered me a credit card. LOLOLOL. NO THANKYOU!!!

[KelliTPA]

I check my report on a regular basis, plus I am subscribed to credit monitoring so I know when anything changes on my report.  That is why I know that no CA has reported the debt.  And, because First Premier owns it, they are still reporting a balance.  Here is how it reflects now.  It does not show a charge off so I don't want to risk contacting a CA who may purchase the account from First Premier because they know I will pay. 

Since First Premier is the last creditor and only creditor to report, my hope is to just pay them and have my balance go to $0.00 without a CA ever reporting. 

Do you know what the difference is between the OC selling your debt or just assigning it?  I know when the OC sells the debt, the CA purchases it for pennies on the dollar and then tries to collect the full amount to make a profit.  What does the CA get if the OC just assigns them the debt to collect instead of just selling the debt?

FIRST PREMIER  Hide Details	461007414802XXXX	11/2006	$770	08/2010	$770	COLLECTION ACCOUNT	$0
FIRST PREMIER 3820 N Louise Ave Sioux Falls, SD-571070145 (605) 357-3440 Account Number: 461007414802XXXX  Current Status: COLLECTION ACCOUNT  Account Owner: Individual Account.  High Credit: $770   Type of Account : Revolving Credit Limit: $0   Term Duration:   Terms Frequency:   Date Opened: 11/2006   Balance: $770   Date Reported: 08/2010  Amount Past Due: $770  Date of Last Payment: 09/2007  Actual Payment Amount:   Scheduled Payment Amount:   Date of Last Activity: N/A Date Major Delinquency First Reported: 02/2008  Months Reviewed: 26  Creditor Classification:   Activity Description: N/A  Charge Off Amount:   Deferred Payment Start Date:   Balloon Payment Amount:   Balloon Payment Date:   Date Closed:   Type of Loan: Credit Card  Date of First Delinquency: 10/2007  Comments: Collection account

[Anonymous]

From what it looks like First Premier still owns the debt at least for now. They probably have sent it over to their own "collection department" which is probably a third party CA acting on their behalf. My suggestion would to be either call first premier and come to a comprimise since they are reporting information relating to a debt that you have received no written notice on. Since the account status has been changed to "collection account" they have to send you a formal letter in writting within 5 days of changing any account status. If you can prove that didn't you have now got them wrapped around your little finger so to speak. But since the collection account is listed under the OC you have probably already received a pre-notice (letter stating if you do not make a payment soon your account will be turned over for collections). You actually have to receive a letter within 5 days of them changing it stating that "your account has BEEN sent out for collections" or something to that effect stating that it has now been turned over to someone else. If they have not provided you with this the ball is in your court.

First tell them that they have violated your rights by reporting inaccurate information as you have not received anything in writting stating that the status of my account has been changed and sent to collections. Now they have to prove that they did send you written notification. Unless they sent it certified mail which is almost 99.99% certain they didn't they have no way of proving they actually did send it. Good legal defense if needed. Make them remove it within a 24 hour window or you will be forced to take legal action against them and course don't forget to inform the AG, FTC and BBB. Work that into your message, written or oral, to the CA. They will almost always remove it to avoid spending money on a costly civil suit against them. Then once they remove it. Offer to make a goodwill payment and you will forget this whole ordeal ever happened and make them purge all records of the debt. This way they are not "deleting" anything for payment. Only correcting a mistake that you have to act fast on to take advantage of to make it go away forever.

Again just my suggestion. If you think writting letters takes to much time as I do and you are impatient, call them. ONLY IF you can keep calm and collected throughout the entire phone call. Don't get frustrated if they try and tell you they can't. Keep asking for their boss until you can get someone that can make a decision cause chances are the first person that you talk to is only looking at a computer screen reading a very limited amount of information about you (name, address, phone #, last 4 of your social, and possibly DOB, and thats prob it) They just do not have the authority to make those kinds of decisions. Dont preach a bunch of law crap. That usually only makes THEM angry. If you get someone high enough they will know the law. Hence why I say don't preach a bunch of law that you may know very little or nothing about other than what you have read online.

Try to reason with them first. Everyone has problems. You, me, the CA representative on the phone. Try and reason with them and tell them that you would love nothing more than this situation to benefit both parties. They get their money...You get it off your report.

Plain and simple.

To summarize. I wouldn't send payment to them before first talking with them. Don't admit to anything. PERIOD! ANYTHING! Don't promise to secure payment, or any variation of that. Remember they WILL be recording the phone call to catch you saying something that could incriminate you and prove that you owe this debt. you still have 4 years according to your FDOD so think very carefully about what you say before you say it. They will try to get answers out of you quickly so you wont have time to think. They want you to react and if they do they gotcha.

Since it looks like they have not "SOLD" the debt yet don't think that you going to be able to offer them anything less than 100% for the outcome desired. You give them 100% they usually give you 100%. You give them half and you are giving them less of a reason to resolve to debt YOUR way. Thats why if you offer what they want you should be able to get what you want. Do not send payment until they agree IN WRITTING to your terms.

This is only one of a couple of ways to handle this. There are faster but usually riskier ways of taking care of this but again it involves more risk.