@icloud987 wrote:hank you so much. Your reply is constructive.
To confirm, you meant I could ask the CA to send me the agreement in writing first and then pay them after receiving the deal?
Did you pay them through check? I hear check a safer way to protect ourselves?
You're welcome, I'm glad I was somewhat helpful. 
Yes, we asked them to send us a written agreement that upon [immediate] receipt of payment in full, they would remove the derogatory mark from my credit bureau reports. Once we had that in hand, we paid the bill.
I don't think any of them were paid by check, but I could be wrong. I LITERALLY had hundreds of bills; some ONLY accepted checks, others had other options, and I know both my daughter and helper wrote some checks, but I'm not sure which those were. I know for sure the vast majority were paid by card (credit or debit) over the phone. It really shouldn't matter though, because in this digital age, we no longer need a hardcopy check to prove we paid a bill! Get the agreement, pay the bill however they prefer, then follow up and make sure they keep their promise. Then, if they don't, you'll have a virtual 'paper trail' to prove you paid.
@icloud987 wrote:Thank you so much. The reason I was thinking about paying in full is my score is slightly below 500 now, when I use the Fico simulator, it shows if I pay all debt off in full ( charged-off accounts ) My score will be about 620 in 24 months which would be barely enough to get a home loan.
So I assumed if I settle for less, my score would be even lower and maybe too low to get a home loan after 24 months?
If there is no score difference in 2 years whether I paid in full or settled, I don't see any point in paying in full then?
Can you share when it is good to pay in full? Is it only good before my debt charged off and before my score dropped?
I am new to all this.
A few things here.
1. Don't pay any attention to score simulators. They don't take into account all factors, so most of the time they're inaccurate.
2. As already mentioned above, paying in full or settling for less makes no difference score-wise, however if you settle for less, the creditor would include a comment saying something to the effect of "Legally paid for less than full balance." Again this doesn't affect your score, but a mortgage UW *may* question you about it. If so, you can easily explain it away. So no big deal.
3. You're right, if there's no big difference between paying in full or settling, you might as well save some money and settle for less. Just keep in mind, when settling for less, if the forgiven balance is $600 or more, the creditor will issue a 1099-C and you'll most likely have to pay taxes on that amount because it gets counted as taxable income by the IRS. Occasions where it would behoove you to pay in full would be when you want to get back in with a creditor whom you "burned" either via BK or simply letting an account get COd. If you wish to do future business with/get another CC with a creditor whom you've got a charge off with, you'd have to pay them back in full.
@icloud987 wrote:Thanks a lot. I noted what you said, it is very helpful.
"Occasions where it would behoove you to pay in full would be when you want to get back in with a creditor whom you "burned" either via BK or simply letting an account get COd. If you wish to do future business with/get another CC with a creditor whom you've got a charge off with, you'd have to pay them back in full."
For this one, if I dont pay them back in full but settle for less amount, and if my spouse has accounts at Navy Federal, would they not allow my spouse to add me as an authorized user, on checking accounts or credit cards ever in the future? So I will never have a chance to be a member of any of the credit cards I didn't pay in full?
I'm not sure what Navy's policy on AUs with prior charge offs that weren't paid in full is. You'd have to call and ask them.
As far as "never having a chance to be a member of any of the credit cards you didn't pay in full," the answer is: it depends. With some issuers, no, you won't be able to. With other issuers, you *may* be able to, but after a very long time (i.e. decades). Even then, some issuers STILL won't let you back in even if paid back in full.
So, that's why I say you should consider paying back creditors in full if you can, particularly those you wish to have a credit card again with in the future.
@icloud987 wrote:Would you say as long as I pay banks back in full one day ,almost all of them might give me a second chance for their credit cards and loans?
No but if you pay them back you have a much better chance of some day getting back into their good graces.
@icloud987 wrote:I owe most to NFCU . About 27000. It is hard to dertimine if I should manage to pay back in full ,( it is charged off) . If there is no telling they would issue credit cards to me again ? What would you do ? My checking account with them still open.
If they wont issue me a credit card ,but I pay back in full , will they prohibit my SO to add me as AU ? Will they at least consider a secured credit card for me ?
Thanks.
Again, you'd have to ask about being able to be added on as an AU or not with an outstanding balance. But for sure you won't be able to get your own card with them if you don't pay them back in full. Once you do, Navy is very good about allowing people to get credit products again once they've been made whole. So with Navy there IS telling if they'll let you back in. Can't say the same about other creditors though.