I have two Chase charge offs that are way more than I could pay. They are there on my credit reports haunting me, but there's no collection agency reporting. I don't answer calls from 800 numbers I don't recognize, but I figured at least one of the callers is trying to collect on these accounts. But they never leave messages so I just cross my fingers and ignore them.
Then one day I start getting texts directly from Chase. Oh, crap. They say log in and view your options. For awhile I was too nervous to log in because I figured that would trigger more aggressive collection efforts, lawsuits, etc. And I knew I couldn't pay what they wanted. But one day I just grew a pair and logged in to see the damage. They were offering to settle for 10%! A $8.9K balance for $890. A $6K balance for $600. Man I jumped on that so fast and I was kinda shaking as I accepted and set up payments. I paid the $600 instantly and divided the other into two payments. Received the agreements via secured messages online, received payment confirmations. They've cleared my bank. I couldn't believe it. I know there will be a big tax hit next April but that will have me at around 30% total.
This experience gave me the confidence to reach out to Capital one to try to settle a $4.2K balance CO. They offered $2600 out of the gate. I countered with $2K and they split the difference with $2300 and up to 12 months to pay. I know this restarts the SOL but it's worth it. I was only 3 years in and the SOL is 6 years in my state. Plus, I was getting settlement offers from their law firm. I tried to counter offer with them but they just ignored me (I mailed them since they were mailing me.) I figured I was on borrowed time and this one was probably headed to court and I didn't want a judgement on my record.
Next up are two large collections, but they are with CAs that make it their policy to remove their reporting 30 days after they get paid. The Chase 10% offers put me in a position to be able to move forward with these. I want to set up payments with them, but I'm going to hold off until I'm sure I have Capital One taken care of. I haven't heard from either of the CAs so far, but I'm sure all these changes to my report will probably wake the giants.
If I did manage to get them off my report, I would be left with a measly $200 paid collection that refused to PFD. I even called the original creditor to see if they'd pull it back from the CA so I could pay them directly. They just said I could pay them or the CA but they weren't pulling it back so I could get it off my reports. It's for a utility though and I might move, and it needs to be paid so I can get electricity at the new place.
I went ahead and paid the CA for this one and miracles of miracles it's gone from all three reports. I gained 14 points on my Experian FICO when this was removed. Don't know about the other two; I'm not currently monitoring them except with free VantageScores.
thanks for listening...
So for the three accounts it comes out to about 19.8%, plus my taxes.
If you are insolvent at the time of settling and a 1099-C is issued then you very well may not even have to pay taxes on it, there is a schedule to figure all this out before you just pay tax on the forgiven debt. Insolvent means unable to pay the entire debt off.... You got a fantastic deal out of Chase.
@gdale6 wrote:If you are insolvent at the time of settling and a 1099-C is issued then you very well may not even have to pay taxes on it, there is a schedule to figure all this out before you just pay tax on the forgiven debt. Insolvent means unable to pay the entire debt off.... You got a fantastic deal out of Chase.
That's great to know. I'll definitely be looking into that! Thanks, gdale6.
@Greenivy wrote:This awesome! I could only hope for 10%....hell 30% is a good option for me in my case. I'm scared to reach out to Capital One though, as I heard they are known to sue.
I reached out to them because they already had lawyers reaching out to me. They sent me options in a letter that had the name of my local civil court. No filing or anything, just a scare tactic at this point. I checked the court docket online and I wasn't listed yet so I contacted Capital One directly. They gave me a slightly better deal than the best deal from the lawyers back in February. I tried to counter but the lawyers ignored my letter, then in a month sent me new offers that were all higher than the first. So things weren't going in the right direction and I had a bad feeling Cap One was the one that was going to court. My interaction with them was pleasant. No threats or insults or pressure. They offered, I countered, she "checked upstairs" and came back with an offer that split the difference and I accepted. I definitely didn't want to continue to leave it unresolved. I have a year to pay. If I have a good year I'm thinking about paying it in full if I can. My settlement offer is at 55%. Might be good to pay in full and keep Cap One as a future option. I checked the preapproval site and I'm preapproved for their secured cards.
@JM761 wrote:Congrats on the settlement!
I also settled with Chase - about 13%, I think. $1200 for an $8700 CO. I probably could have gone a little lower but I didn't want to play the cat and mouse game with them any longer. I was so anxious I would be sued (I was sued by synchrony and only got about 65% settlement on that one - again, did it to get it over with b/c I was scared of garnishment). It's amazing how I started to sleep better after I paid - less freaking out at each unknown number calling me, less waking up worried in the middle of the night. For me, the extra ended up being worth it just so I could feel a bit more sane!
Congrats again - keep us posted on the CapOne!
Yeah, hearing from lawyers definitely adds to the stress levels.
