I have a Chase account and a Citi account. The Chase account was about 6 months late but I caught it before it got sold off and was able to bring it current for a 2000 payment so the current balance is about 12,500 with a rate of 12% and making monthly payments of 350. This should now report as current however the account is still closed. I also have a Citi account that was about 9 months late and it got sold off to a collector. That balance is about 14,700 but 0% interest and monthly payments of 357. The Citi account has offered to settle at 60% or 8800. I want to save my credit as much as possible. The Citi collector has told me they will not do a pay for delete (PFD) and that I won't be considered current until I pay it off in total. I can make the monthly payments on both cards no problem and will focus on paying extra on one of the cards to get it paid off quicker. My questions are:
1) At this point since the Citi card is sold off, should I just go ahead and settle it or should I attempt to pay off in full? I understand a settle can stay on my credit for 7.5 years and I would receive a 1099 but I want to focus on improving credit.
2) If I don't settle and just make monthly payments, which account should I make the extra payments on to pay off quicker? I can probably afford about 1000/month total for these two cards. Chase would be paid off quicker and they have a higher interest rate so I'm leaning towards that but Citi is the one probably hurting my credit worse so I'm not certain which I should focus on.
Appreciate all advise. Thanks.
