Ok I got a loan today to pay a few things off. One thing that popped up was a 2000 charge off on a car note. The car was totaled a year and a half ago and GAP covered about 4000 of the upside-downness but there was still 2000 left over from some deferred payments.
I went around and around with the creditor trying to set up a payment arrangement because they said my options were 2200 in full, 2 payments of 1000, or continue paying the $350 a month that I was normally paying. Since I had picked up another car and was already paying $300 a month on that, I couldn't afford 300+350.
I said there has to be a better arrangement, the car was supposed to be paid off in 2013 so why can you just devide the amount I owe you by the number of months left until 2013 and then everyone will be happy. They said no. So I told them I guess we have nothing more to talk about and hung up.
Off and on for the next couple of weeks I would answer the phone and I'd make them the same offer and they'd refuse so I'd end the call.
Finally I got tired of the run around and said "Make me a deal or I'm just going to block your number and hung up" I waited about a month of them calling and finally got a message from them "Hi xxx we would like to offer you a easy payment arrangement on this debt. Please call our special circumstances line at blah blah blah"
So I called and they were willing to settle for 1/2 or 130 a month for the next year. I said that sounded much better and I wrote them a check.
I kept this up for a few months but my hours got cut at my second job and I could no longer afford the payments so I got behind. I got 1 phone call from them over the course of 3 months and that was it.
Today I went to look into getting a loan for a family emergency and they said that they showed the car company had posted a charge off of 2000 dollars. One of the conditions of loaning me this money was they had to tack an additional 2000 on to the loan to pay the chargeoff. And cut a check directly to the company that I owed money to.
I called the car company today and asked about paying it off but they said they had already referred it to a third party. I told the company that I got the loan from and they said that if I could get the details, they'd reissue the check.
I got the number of the collection agency and they said lets do a down payment of $500 and then 200 a month or we'll just take $1300 and call it even.
So I said ok well that's a settlement, which I know is better than a charge off, but how much worse than a full repayment? And the guys said "probably 5 points on your score"
In the past 4 years I've managed (without spending a dime) to get my score from the low 400s to 597. *(Well I say not spending a dime, I mean I was able to get old stuff off by repeatedly sending challenges via certified mail to anyone that sent me a collection letter. And also got a car loan via my credit union by becoming friendly with the CU President)
That car loan and another signature loan has been auto deducted from my payroll so that's easy for me to take care of and it looks good.
If I could pay the $1300 and get the charge-off converted to "settled" I could use the remaining 700 to pay off a payday loan that I had and that frees me up some more cash to apply towards this loan.
So what do you think.
