Settlement offer with ERC; do I accept?

[Anonymous]

Received a letter from ERC, regarding a collections account with Kohls/CapOne. Total balance is $541, they are offering settlement of $285. The letter states they will consider the account closed and stop collection attempts. From what I have read PFD is not often an option with ERC. The SOL is 5 years I believe, and this is due to age off in 2021. Am I better off paying this now, or waiting until it's past the SOL?

[Anonymous]

First off welcome to the forum. Secondly, by waiting you always run the risk of getting sued. I find this unlikely for such a small amount but stranger things have happened. Being such a small amount and being unlikely to sue may be why they are trying to settle with you.

You have many options here in my opinion.

1. Wait for your sol to run out, why I don't know but you brought it up.
2. Accept their offer and then try to goodwill them to death for removal.
3. Offer to accept their offer with contingent that they remove it from all bureaus and stop all reporting, the pfd.
4. Make a counter offer with a lower amount as acceptance as payment in full ( goodwill them later) or with either a pfd.
5. Offer to full payment for delete if that us what you want and have tried the other options and they have resisted.
6. Ignore it, again I don't know why you would but it's an option.

Good luck

[Anonymous]

Sorry for the bad grammar, I'm on my cell sitting outside. I need to get my office put together in a bad way. I hope you get the gist of what I was trying to say, I re-read it and I barely understood it. Again I'm sorry

[Anonymous]

Haha I did get the gist and I appreciate the advice. My wife and I are going to be tying to buy a house in 2-3 years and I want a jump start on making my credit ready. So confused on what to do about collections before a mortgage, but figure even if paying them off drops my score a little it's far enough in advance. I appreciate the advice and will take of the collection soon.

[MugenCivicSi83]

In my recent experience with ERC, they were on my CR for a small $47 collection and then bought a T-Mobile collection for $586 from another CA. During the first time I contacted them I told them I had moved and they likely had a wrong address and I was unaware of the charges and what they were for. They then sent me a letter stating I had 30 days to dispute the collection. During this time, the collection was removed from my report somehow and during that time, I went into their website and found both collections and paid them in full... now they were never placed back on my CR's. Problem solved for me. I'm not sure if this would work for everyone. YMMV.

[RobertEG]

Did ERC purchase the debt, or is it still owned by the original creditor?

Is the original creditor also reporting, and if so, what derogs were reported on the OC account?

[Anonymous]

Hi Robert, ERC did purchase the debt. It's 2 years old, Kohls (Capone) is listed as the creditor on the letter but not on my report. It's showing $541 as the original derogatory. The offer from ERC is 50%.

[Anonymous]

If you agree to settle, you may be able to do what I call a "back door PFD". Most lenders, CA's and JDB's see their job of keeping derogatory info on a consumer's CRA file as almost a Holy Obligation and will not agree to a PFD outright, but you may be able to get one through the back door if you follow these steps:

1: Contact them and tell them you wish to settle but want a Confidentiality Agreement in the settlement. Most of the time they will agree with that.

2: Make sure the Confidentiality Agreement applies to both you and them. Also, make sure that there is wording that prohibits any communication abpout this matter to ANY third party whatsoever. They will usually agree to that. Also, see if they will accept a statement that there is to be NO reporting of this matter by them in any way whatoever to any CRA under any circumstances. They will usually agree to that.

3: Sign the Settlement Agreement with those provisions in it any pay them.

4: Thirty days leater, dispute their TL in the CRA's. They have three options - ignore the CRA's request for confirmation that the TL as it exists is accurate (at which point FCRA requires the CRA to remove the TL), or correct the TL or verify the TL as accurate, in which 2 circumstances they have violated the contractual Confidentiality Agreement and you sue them over it.

[RobertEG]

Then you no longer have any option to pursue termination of the collection authority and payment directly to the OC.

You can first make a PFD offer to the debt collector.

If they do not accept, the next best thing would be to obtain discharge of the debt (with update of their reporting to show $0 balance) by paying less, with the additional agreement on their part not to report settled/paid for less to the CRA.

Acceptance of their settlement offer with the additional condition that they not report settled/paid for less to the CRA would be my advice.

That would obtain discharge of the debt and avoid any comment in your credit report that states you did not pay the full debt that you obligated.

That is never a favorable comment in a future manual review.