medical: Too good to be true? Ever heard of this?

[panicattack]

I have several medical collections split between two collection agencies.  All bills are for the same hospital.  I had no luck in negotiating a PFD from either CA.  Both claimed they do not sign PFDs.  One said it would no longer be reported after payment, but refused to put it in writing.  The other said they continue to report as paid, no exceptions.

I called the hospital's billing department and asked if they could recall the accounts and if I could deal directly with them.  They said they would call off the dogs if I made payment in full or even a negotiated price, but would not do so if I made a payment arrangement.

I told her I was not in the position to pay a lump sum and pressed her for reasons why I should go into a payment plan if it was not going to help my credit.  When she got the hint that I was not offering up money, she asked if I banked with any of the local credit unions.  I said yes.  She then explained a program where I could get a guaranteed approved loan to cover the cost of all bills, payable in five years at 6%, regardless of my current credit score.  She said this was available for medical bills only.  She said I could even negotiate the total bill down before submitting it.

I asked if she would put it in writing that she would recall the debt from the collection agencies and have the records deleted from my credit reports.  She said yes.

Have any of you heard of such a program that offered guaranteed loans to pay off medical bills?  I believe she called it "guaranteed outside funding".  If so, any success stories?

Is this too good to be true?

[guiness56]

I have never heard of it but it doesn't mean it isn't true.

Personally, I would not go into debt to pay off debts.

[panicattack]

I don't see it as "going into debt to pay debt".  I look at it as trading debt that is reporting bad for debt that is trading positively.  Am I wrong to think of it that way?  The monthly payments will not be a problem.

[Jon85]

That's how I would look at it too.

You're getting into debt to pay off debt, yes--but you'll be creating a positive TL if you make payments on time, while also deleting the negative TLs so I think it's a good trade off.

When you find out about the credit union, can you let us know and keep us updated? I never heard of that either-

[jojomomma]

My credit union has a loan they call G.O.O.D. loan, get out of debt loan.   It is a personal no collateral loan.   I wouldnt be surprised if other credit unions offered similar products to their members.

[750orbust]

I wonder if this would still be an option if the hospital was unable or refused to recall the collections? I really can't see any lender offering up a loan to pay off collection agencies. Stranger things have happened though I guess.

[guiness56]

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@panicattack wrote:

I don't see it as "going into debt to pay debt".  I look at it as trading debt that is reporting bad for debt that is trading positively.  Am I wrong to think of it that way?  The monthly payments will not be a problem.

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That was just my opinion.  If I had $10,000 in collections and took out a $10,000 loan to pay them off, I still have a $10,000 debt.

No, it is your opinion so it can't be wrong.  Since the collections are being removed then in the long run it will be beneficial to you.