Need Clarification

[basballguy]

I have the following account....The charged off amount was only around 800 dollars (for fees and other items) but GMAC has offered 300 or so to settle it.  Is there any advantage of paying it other than getting the title to this vehicle?  Is there a disadvantage?  They indicated they'll update to the CRA but I'm not sure that I would want that.

Vehicle Loan AccountGmac

Status as ofDate opened [?]Date of last activity [?]Account number [?]Terms [?]Account Type [?]Account holder [?]Industry

Jul, 2011

Aug, 2003

Feb, 2009

XXXXXX6034

(60 Months)

Installment

Individual

Auto Financing

Descriptions [?]

• Charged off account
• Auto

No contact information provided by Equifax

Balance [?] Current Status [?]

$0	Bad debt/collection

Seven year payment history [?]30 days late60 days late90+ days late

0 times

0 times

0 times

Worst Delinquency [?]

None Reported

[Shogun]

They haven't appeared to update for 2 years, so if they do, it could cause a few points drop.  But it would be paid/settled and gone.  Then you could GW them.

[RobertEG]

Kinda confusing from the CR information provided.

They have reported a current balance of $0, which implies that they no longer own the debt.

That would explain absence of recent reporting

If they no longer own the debt, they cannot accept any payment  Thus, they would be unable to offer a settlement.

Can you clariify as to whether they stlill own the debt, and if so, why they reported a $0 debt balance to the CRA?

[basballguy]

---

@RobertEG wrote:

Kinda confusing from the CR information provided.

They have reported a current balance of $0, which implies that they no longer own the debt.

That would explain absence of recent reporting

If they no longer own the debt, they cannot accept any payment  Thus, they would be unable to offer a settlement.

Can you clariify as to whether they stlill own the debt, and if so, why they reported a $0 debt balance to the CRA?

---

I put everything I know in my post.  GMAC/Ally Financial is directly offering the settlement.  AFAIK it has never been sent to collections.  No collection agency has reported on it that's for sure.  It's an unusual situation which is why i posted it. 

[pizzadude]

My approach would be to try and negotiate a PFD arrrangement, to get them to delete the account in exchange for payment.

Since it is a charged off account, it's hurting your FICO score, plus as Shogun mentioned, it might get updated when they note your payment, which will drop your score.

[AndySoCal]

I agree with the approach posted by Shogun for  acouple of reasons.. One I doubt if you can get PFD out of this. Secondly, yes there is a potential drop in the score if you pay it, but a new collection account being reported  would hurt more than the potential drop in my opinion. Lastly the debt is paid off and it will eventully fall off the report at some point in time.

[basballguy]

as a follow up, i called GMAC/Ally and asked some questions.  They said for these write offs they do they don't refer to outside agencies and if i wanted to wait until after I closed I can.  So that's what I'll do.