topic Re: Citibank Will Not Settle or Accept Payment for Chargeoff in Rebuilding Your Credit

Citibank Will Not Settle or Accept Payment for Chargeoff

magicflyer — Wed, 02 Aug 2023 23:16:37 GMT

I had a Citibank credit card charged off mid 2020 for just shy of $10,000. I didn't have any money to pay them up until recently so I just ignored them and eventually they stopped calling (I'm honestly very surprised I wasn't sued). Fast forward the the past couple months, I have been trying to get them to settle but their centralized recovery department keeps reiterating that they have cancelled the debt and may send me a 1099-C and that any payment made would be voluntary. They are updating my report monthly with the chargeoff and it is making it impossible to recover my scores. Is there anything I can do to get them to accept a settlement? Seems silly that they would rather only accept payment in full, or nothing but get to trash my scores for 7 years. I linked an older but similar thread below.

https://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/Citi-bank-says-debt-is-too-old-for-settlement/m-p/6464975#M654697

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

CreditCuriosity — Thu, 03 Aug 2023 00:26:59 GMT

Appears that they wrote off the debt for tax reasons and likely will report the seven years. Surprised they didnt sue or garnish your wages either and the article you linked basically had a few other scenario as yourself. Guessing as mentioned since they wrote it off they got some tax benefit and you will have to pay some of that on your taxes however that works since receiving that form. Maybe others will be better help here.

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Johnny35 — Sun, 06 Aug 2023 18:52:05 GMT

Do you know when Citibank cancelled the debt?

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Johnny35 — Sun, 06 Aug 2023 18:40:37 GMT

If they cancel the debt, does that mean they can't sell it anymore to a collection agency?

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

GZG — Sun, 06 Aug 2023 18:43:23 GMT

@magicflyer wrote:
I had a Citibank credit card charged off mid 2020 for just shy of $10,000. I didn't have any money to pay them up until recently so I just ignored them and eventually they stopped calling (I'm honestly very surprised I wasn't sued). Fast forward the the past couple months, I have been trying to get them to settle but their centralized recovery department keeps reiterating that they have cancelled the debt and may send me a 1099-C and that any payment made would be voluntary. They are updating my report monthly with the chargeoff and it is making it impossible to recover my scores. Is there anything I can do to get them to accept a settlement? Seems silly that they would rather only accept payment in full, or nothing but get to trash my scores for 7 years. I linked an older but similar thread below.

https://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/Citi-bank-says-debt-is-too-old-for-settlement/m-p/6464975#M654697

@CreditCuriosity wrote:
Appears that they wrote off the debt for tax reasons and likely will report the seven years. Surprised they didnt sue or garnish your wages either and the article you linked basically had a few other scenario as yourself. Guessing as mentioned since they wrote it off they got some tax benefit and you will have to pay some of that on your taxes however that works since receiving that form. Maybe others will be better help here.

if they set the balance to 0, are they allowed to continue reporting the CO monthly? If you pay it to 0, the reporting stops, so why wouldn't it stop if the lender 1099-C's it?

there's no way a lender can just say "welp sorry, here's a 1099-C, nothing you can do now to change our monthly reporting"

they have to allow OP to pay to stop the reporting so that it's accurate don't they?

perhaps this is a HUCA situation, I can't imagine Citi's bank's policy is not to accept payments on a debt or refuse to even entertain settlement offers.

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Determined1234 — Fri, 07 Mar 2025 16:14:12 GMT

This is exactly the logic of Citi Bank. They would rather take nothing than to work with you. They are impossible, even when they make no sense whatsoever. I have called them numerous numerous times and they just shoot themselves in the foot.
Have they sold you to a debt collector yet?

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Determined1234 — Fri, 07 Mar 2025 16:15:06 GMT

I just noticed you said that they're sending you a 1099C and I'm wondering why they're still reporting a balance

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

FicoMike0 — Sat, 08 Mar 2025 00:24:02 GMT

Sounds like some hard asses.

I suppose they can report for 7 years as long as it's true.

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Determined1234 — Sat, 08 Mar 2025 00:51:55 GMT

Hopefully there's a more positive answer than that one👎

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

FicoMike0 — Sat, 08 Mar 2025 04:54:53 GMT

Id hope so too, but I don't know any. It's surprising they'd just write it off, rather than sell it to a debt pirate. Then you have a chance to settle.

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Determined1234 — Sat, 08 Mar 2025 05:27:42 GMT

Nope, they shoot themselves in the foot. They could make some money or sell it to a debt collector, but they choose to do nothing. They just let the debt sit there year after year and refused to budge

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

myscoresucks2 — Sat, 08 Mar 2025 17:53:55 GMT

I received a 1099 from city bank last year, I sent a copy of it to all 3 credit bureaus, requested deletion of the account because it was forgiven per the 1099. It was removed from all 3 bureaus. I did have to pay taxes on the 1099, was were way lower than the original balance, if you can prove that you have a ton of debt then you fill out a form and you don't pay on 199 either.

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Determined1234 — Sat, 08 Mar 2025 19:13:45 GMT

Thank you so much for sharing and I'm happy for you that you were able to get Citi Bank removed. Otherwise it seems to be impossible. Was wondering how long after the original default where you sent a 1099?

@myscoresucks2 wrote:
I received a 1099 from city bank last year, I sent a copy of it to all 3 credit bureaus, requested deletion of the account because it was forgiven per the 1099. It was removed from all 3 bureaus. I did have to pay taxes on the 1099, was were way lower than the original balance, if you can prove that you have a ton of debt then you fill out a form and you don't pay on 199 either.

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

myscoresucks2 — Sat, 08 Mar 2025 19:19:41 GMT

I received it in the 6th year, you can call them up and request it, since it says your account is written off, then once you received it send it to CRAs and ask for deletion for forgiveness of debt

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

Zoostation1 — Tue, 11 Mar 2025 04:38:53 GMT

@GZGI am not surprised at CIti having no interest in getting paid back once behind. I burned Citi for $29k after getting behind when I was out work for 2 months (DOFD back in 2012). Fortunately I found employment with a comparable salary reasonably quick, but it didn't matter. I got calls almost every day hounding me until I actually tried to start paying them back). While I was less than 90 days past due, they wanted nothing to do with me catching up or working out a payment plan I could afford, so I had the credit counseling non profit I was working with on a budget contact them. All Citi would accept was a "hardship plan" that closed my account and raised my monthly payment so high I couldn't pay my rent if I paid them (they wanted to sell the debt almost immediately and it was sold very quickly. Oddly enough I was never sued by citi or the next owner of the debt (only Discover several years later, who was a much smaller burn and eventually led to my BK). None of this is an excuse for poor decisions I made in the years before hand but just to show that Citi is quick to dump off delinquent debt.

Re: Citibank Will Not Settle or Accept Payment for Chargeoff

sjt — Fri, 20 Jun 2025 18:20:29 GMT

Chances are Citibank never cancelled the debt nor sent you a 1099C, otherwise you would have received the 1099C. I would speak with a supervisor.

This happened to me years ago and went ahead and paid them, they updated to paid status and my scores increase 30 points.