topic Re: Amex delinquency, settlement vs paid in full. in Rebuilding Your Credit

Amex delinquency, settlement vs paid in full.

Anonymous — Wed, 10 Sep 2014 08:03:53 GMT

Hello everyone. This is my maiden post! I'm in a bit of a pickle and could use some experienced advice. Any help would be appreciated. A bit long but its interesting!

A bit of background. Got my first credit card in 2007 fresh out of high school. It was a Capital One Platinum something with a $2500 limit. I had no credit file so this card is what built my credit report. I got a Blue from Amex In 2011 with a 720 credit score. It had a 10k limit. This is where my all my troubles began! I was young and lost but thought Amex was the way to freedom. I started charging while completely intent on paying my monthly minimum at least, but usually more. I even charged my full college tuition on the card one semester. Amex kinda figured and reduced my limit to $6000 after a while.

well im still young but not so lost anymore. Along the way ive had some hardships. Fall of 2012 i got sick with some medical issues. They eventually led to me having to stop working. Ive gone through bouts of depression during this time and Its taken a year and a half for me to finally start getting better. While initially i had quite a bit of savings to pay my cards monthly, eventually my savings have dwindled.

Currently, i am around 150 days delinquent on my Capital One with a $2600 balance. Capital One offerred a interest reduction to .9% for 12 months which i accepted. They revoked charging previlges but the credit line is open. Capital One stated card will remain open unless i close it but charging prevliges will never be reinstated on that card. (That makes no sense to me).

And i'm around 150 days delinquent on my Amex with a $6400 balance. Amex offered up to 9.99% interest reduction for 12 months or I negotiated a $3500 settlement with $115 upfront through Amex collecting agency GC Services. The card has been 'closed by credit guarantor' but NOT charged off. I received a regain card membership letter in the mail for an Optima Card with variable APR and $49 annual fee. Only other loans on my CR are defferred student loans.

So, my parents have been nice enough to lend me $6000 to pay these down. I could settle the Amex for $3500 and pay off the Capital One around $2600. That'll be the end of this chapter in my life. Problem is, digging around on some forums, it seems doing a delinquency settlement is more detrimental to credit scores than delinquency itself. Apparently, if its been Charged Off, a settlement wont do any further damage but if its just delinquent, a settlement will do as much damage as a CO? So im just not sure which route to take…

Should i take an Amex settlement on the delinquency or should i pay it down in full and get the Optima?

If the delinquency wont have a lasting affect on my credit score, id rather just pay in full. But if a settlement wont add to the damage, then id rather settle. However id like to have an Amex again in the future. So what are the chances Amex will overlook this? The amount itself isnt too much, only $3000 written off for them.

My credit score is Transunion 501, Equifax 438, and Experian 465. 2 delinquent CCs, and a few current student loans. Thats it.

My main concern is rebounding my credit scores sooner than 7 years but if a settlement can save me $3000 with little further damage than delinquency, I could sure use that money to get back on my feet sooner. Thanks a bunch for your help!! Much appreciated.

TL;DR: Please read it. I put lots of thought into it. Thanks.

Re: Amex delinquency, settlement vs paid in full.

baller4life — Wed, 10 Sep 2014 11:32:36 GMT

Paying the accounts in full will certainly look better than a settlement. Many have been able to complete the Optima program with Amex and get back into their good graces. If it were me, that is the route I would take.

Re: Amex delinquency, settlement vs paid in full.

myjourney — Wed, 10 Sep 2014 12:44:42 GMT

@baller4life wrote:
Paying the accounts in full will certainly look better than a settlement. Many have been able to complete the Optima program with Amex and get back into their good graces. If it were me, that is the route I would take.

+1 to Baller4

Amex Oasis Program: 888-232-3261

Amex has a hstory of letting past customers back in who pay off previous pass due debt....usually within 1-2 after paid in full

Give them a call if you wish to go this route most are accepted into the program but you should know some are not for some reason

Also forgot to add Amex has been known to accept GW's after a settlement and the backdating would do wonders for credit

Re: Amex delinquency, settlement vs paid in full.

tomfromrictmame — Wed, 10 Sep 2014 15:25:30 GMT

@myjourney wrote:
@baller4life wrote:
Paying the accounts in full will certainly look better than a settlement. Many have been able to complete the Optima program with Amex and get back into their good graces. If it were me, that is the route I would take.
+1 to Baller4
Amex Oasis Program: 888-232-3261
Amex has a hstory of letting past customers back in who pay off previous pass due debt....usually within 1-2 after paid in full
Give them a call if you wish to go this route most are accepted into the program but you should know some are not for some reason

Also forgot to add Amex has been known to accept GW's after a settlement and the backdating would do wonders for credit

+2. Exactly what I did with AMEX. They were great throughout the process.

Re: Amex delinquency, settlement vs paid in full.

Anonymous — Wed, 10 Sep 2014 17:38:40 GMT

Well would a settlement mean i could never do business with them again? Is it worth doing a settle over $6400 balance? Settlement would be $3500.

Re: Amex delinquency, settlement vs paid in full.

myjourney — Wed, 10 Sep 2014 17:59:40 GMT

@Anonymous wrote:
Well would a settlement mean i could never do business with them again? Is it worth doing a settle over $6400 balance? Settlement would be $3500.

IMHO I haven't seen many cases of settling for less with the same benefits as described above but no harm in asking them will the program cover that as well.

Re: Amex delinquency, settlement vs paid in full.

tomfromrictmame — Wed, 10 Sep 2014 20:56:16 GMT

@myjourney wrote:
@Anonymous wrote:
Well would a settlement mean i could never do business with them again? Is it worth doing a settle over $6400 balance? Settlement would be $3500.
IMHO I haven't seen many cases of settling for less with the same benefits as described above but no harm in asking them will the program cover that as well.

+1 again. I know I paid my balance in full over 3 "installments".

Re: Amex delinquency, settlement vs paid in full.

Anonymous — Thu, 11 Sep 2014 00:07:23 GMT

Okay. Thanks for the input everyone. I'm gonna work out a payment plan then. If a settlement will further damage my credit than delinquencies than id rather not do it.

Re: Amex delinquency, settlement vs paid in full.

myjourney — Thu, 11 Sep 2014 00:10:11 GMT

@Anonymous wrote:
Okay. Thanks for the input everyone. I'm gonna work out a payment plan then. If a settlement will further damage my credit than delinquencies than id rather not do it.

Good luck and again welcome to the forum

Keep us updated as well

Re: Amex delinquency, settlement vs paid in full.

baller4life — Thu, 11 Sep 2014 00:27:28 GMT

Good luck to you! Hope it all works out

UPDATE Re: Amex delinquency, settlement vs paid in full.

Anonymous — Tue, 11 Aug 2015 01:48:25 GMT

Update. Plus a followup question.

Hi everyone. I'd like to update you all on my progress. So I did take everyones advice here and decide to pay off all balances instead of settling. It seemed to be the smarter decision down the line. I enrolled in the Capital One hardship program and the Amex interest reduction program, both of which I referenced above in my OP (9/2014).

As of today I've paid down my CapOne from around $2600 to about $400. And I've paid down my Amex from around $6300 to under $500. The most surprising thing as of late are the changes to my CS. A month after my initial post last September (2014) I enrolled in the Credit Tracker my CapOne card offers. (This shows me my TransUnion score. It states that the score is based on the TransUnion New Account Model.) Last October it said my TU score was 581. In December 645. I got my first store card at the end of last year. This didnt make much difference and it hovered around 645 or so for the first half of this year. Then this month (August 2015) its abruptly jumped to 713! I don't know what the others are reporting as I haven't pulled my all 3 bureau report since August 2014. However I am surprised by this as I was at least 4 months delinquent only 1 year ago last August. The only changes to my CR are the additon of the store card line of credit and consistently paying down my balances over the last year to bring my Credit Utilization down from 86% last Oct to 11% now.

Regardless, I'm happy with the progress. I've got the CapOne situation under control but I do have a question about the Amex. The Amex offer was 12 months: 1% APR for the 1st 3 months then up to 9.99% for the remaining 9 months. Amex still owns the debt but its being serviced by GC Services. They and Amex both stated that once I pay off the balance, I will receive an application for an Optima card. I have not been told about any Oasis program so I'm not sure if there is a difference between the two frankly.

So in regards to this, should I take the Optima offer or will I have no problem getting a regular Amex now? I've checked my CC offers at creditcards.com and it stated I should be eligible for a Chase Sapphire and CapOne Venture so It seems like my CS is in the good again. I should note I'm in no hurry to get another CC as I dont need one now.

More importantly, I'd like to clean up my Credit Report of the late payment marks. How should I approach this best? I have around a $500 balance with Amex so should I send them a PFD carrot? Or would it be better to pay of the remaining balance and then send a GW request? Or better yet, should I dispute the marks with the Credit Bureaus instead? I'm also wondering since my score seems to have rebounded is it even worth the trouble... but then again, it'll be on my CR for another 6 years so maybe it is?

I'm sorry this got longer than I anticipated! Its a well rounded picture though and I've kept it to the point so hopefully this will help others in a similar situation. I'd like to give kudos to all of you who gave me advice initially. I'm glad I listened to you guys and I'm really happy with the outcome thus far. So thank you.

Re: Amex delinquency, settlement vs paid in full.

Anonymous — Tue, 11 Aug 2015 02:05:12 GMT

Congrats! Yeah I learned myself that paying in full is much better than a settlement with state farm bank. The guy when I asked about a settlement was like.....settling Mau affect your score..... So I researched and found out its no bueno.

My scores are touching 700 now just a year after and I went 6 straight months with no payment. Paid in full. 2 QS, 1 Discover, and a CU card highlight mine.

Re: UPDATE Re: Amex delinquency, settlement vs paid in full.

Anonymous — Tue, 11 Aug 2015 02:15:49 GMT

AMEX is really picky and if you offer a PFD and they accept, regardless of your score, they may not extend more credit. Be careful with them...tread cautiously. If you qualify for a Chase Sapphire Preferred, you may want to secure that card first before offering AMEX a PFD.

Re: UPDATE Re: Amex delinquency, settlement vs paid in full.

Anonymous — Wed, 12 Aug 2015 00:31:18 GMT

hmm, why would Amex not extend credit to me in the future if they accept a PFD? I'm not asking for a settlement of the balance; I've almost paid off the full balance. I'd just like them to erase or adjust the late payment remarks on my CR hence offering a Pay for Deletion of negative remarks.

If my CS has rebounded, wouldnt the Sapphire be available to me at any time in the future? I dont have any open CCs now and tbh I'm not really in a hurry to get one. Not sure what to get actually. It seems Amex is more prestige than functionality with their service and rewards tbh.

Re: UPDATE Re: Amex delinquency, settlement vs paid in full.

gdale6 — Wed, 12 Aug 2015 02:06:07 GMT

@Anonymous wrote:
hmm, why would Amex not extend credit to me in the future if they accept a PFD? I'm not asking for a settlement of the balance; I've almost paid off the full balance. I'd just like them to erase or adjust the late payment remarks on my CR hence offering a Pay for Deletion of negative remarks.

If my CS has rebounded, wouldnt the Sapphire be available to me at any time in the future? I dont have any open CCs now and tbh I'm not really in a hurry to get one. Not sure what to get actually. It seems Amex is more prestige than functionality with their service and rewards tbh.

If Amex isnt updating monthly now and you pay them you will drop your Fico score when the status date comes current unless you get the PFD. Its near impossible to get a PFD unless its in the last year of reporting as a derog COed account. If you are wanting to improve your Fico you are going to have to open 3 credit cards preferrably bankcards to drive it.

Re: UPDATE Re: Amex delinquency, settlement vs paid in full.

Anonymous — Wed, 12 Aug 2015 21:55:53 GMT

No its not a Charge Off. I explained earlier that I fell behind on payments for about 4 months starting May 2014. They cancelled the account and sent it to GC Services for collection. BUT Amex still owns the debt; its just being serviced by collections hence not COed. I haven't pulled my credit report since last August so idk if its reporting or not since it is a cancelled line of credit. Regardless I brought it up to current status and I've paid the balance down from $6300 to under $500. I was just wanting to remove the late payment remarks. So then I guess my question is does a cancelled CL still affect my credit score?

Re: Amex delinquency, settlement vs paid in full.

Anonymous — Wed, 12 Aug 2015 22:48:57 GMT

Yeah it still affects your score whether it's an active or cancelled card. But thatvdoesnt mean you don't have the fico scores you referenced earlier. I have a 692 on EX Fico despite a 180+ days late. If it wasn't there I'd probably push 740+. It's already done/doing its dmg to your score and will lessen over time. It will also lessen once paid off I believe, but will still show as a negative account. It will affect your score but lenders may still turn you down for a variety of reasons if they don't want someone who was late. Like those who declare bankruptcy may still be turned down despite having a 750 score just because the lender isn't BK friendly.

Re: Amex delinquency, settlement vs paid in full.

Anonymous — Wed, 12 Aug 2015 23:24:58 GMT

Ah okay gotcha. So if I wanna try to get rid of the late payment remarks whats the best way forward? PFD apply to me or a GW? I want to emphasize it wasn't COed, just late payments about 120-150 days.

Re: Amex delinquency, settlement vs paid in full.

Anonymous — Thu, 13 Aug 2015 00:17:08 GMT

I BELIEVE a goodwill campaign. Possibly once it's paid off? I don't know personally how a PFD works so you'd have to search that yourself or someone here may chime in. I've been meaning to GW my own late(6 consecutive payments from October13- Feb14) I'm just too lazy and it hasn't crippled me yet (that I know of) card has since been closed off 2 years ago after the second missed payment. It was my first card. I was an idiot. Period. It'll never happen again so I figure if I can get my scores solid hopefully they overlook the late payments. This mentality isn't for everyone , and realistically isn't even for me. I'm just too lazy to take the time to type it up.

New Update. Re: Amex delinquency, settlement vs paid in full.

Anonymous — Tue, 08 Dec 2015 23:11:17 GMT

TL;DR Recap: Amex debt of $6000 around 5/2014. Got 180 day late remark on CR by 8/2014. Amex cancelled credit line but NOT CO. I've paid down balance. Last remaining balance of $50 due this month.

Okay so I'm trying to get rid of late payment marks. I called Amex Credit Bureau. They said to call Amex CS and ask to either remove deliquencies or reage account. I called CS. They said we dont remove delinquencies and we don't have anything to do with reporting. Called Amex Credit Bureau back. They said you have to convince CS to change delinquncies on internal account so that we can update CR...

I have no idea what to do. They keep pointing fingers at each other. First guy mentioned reaging. What exactly does reaging do? I've read it can hurt or help account.