Settling an account while still current

[joswan040404]

Has anyone settled an account with a creditor while still in good standing? My problem is I have 2 credit cards with a pretty large balance and although I am current on my payments I am close to the end of the line and may soon start falling behind. I'd like to hopefully resolve this before it gets to the point where I'm behind and my FICO score takes a dive. Anyone.....??????

[Anonymous]

I am not sure what is the question - are you asking if you have any way to renegotiate your outstanding amount of debt without hitting your scores?

the answer is maybe. it depends on what you are trying to settle, how much, who's your creditor, what kind of property you own that could be attached by the creditor should you go in default.

If you are thinking about the fables told by scam artists advertising ways to avoid paying credit card bills legally - first stay away because there in not an ounce of truth in them, second this is the wrong place to ask.

But more in general this is not a topic that finds a good home here, where we focus on rebuilding legally credit history that has been hit already.

[joswan040404]

Sorry I wasn't very clear in my question.Yeah, I'd like to know if I can negotiate without much impact on my scores and while still up to date on these accounts. The situation is this, I have several credit cards with what you can call a reasonable balance to deal with but I have 2 that have a very large balance and I am getting to the point where I am not going to be able to stay current and up to date. I'd like to know if I can reach a settlement amount with these creditors before getting to the point where I am behind.

Thanks for the reply 

[Anonymous]

Settle for less than owed = charge off on remaining balance = plummeting credit scores

I don't know the solution. Good luck!

[Anonymous]

That doesn't sound like a good idea. In fact I KNOW that is not a good idea.

Pretty much what you would be doing would be calling the company and saying "Yes I recognize that I charged more than I can afford to pay you back so if I give you part of it can we call it even?"

And they will do it but they will charge off the rest. I myself did this about 4 years ago. I misinterpreted some Dave Ramsey advice. It seemed like a GREAT idea at the time. Now looking at my credit score.... not so much.

What you CAN do is call the company and explain your situation. Depending on what the amount is some will close your account and then set up a set monthly payment that you can handle. They still charge you interest, over the limit fees, late fees ...etc BUT as long as you RELIGIOUSLY pay them what they asked you to on time they might even mark you as "pays as agreed"

I was able to do this with my gateway account and a Bank of America account.

Just make some phone calls and see what you can do.

[Anonymous]

I would first start by trying to negotiate a lower interest rate and maybe a temporary lower payment.

Do you think your inability to pay is going to be something as short term?

Some will work with you, some will not.

[Anonymous]

Another thought - maybe you can get a part time job until a majority of your CC debt is paid off?

[Anonymous]

Excellent suggestion. Many members on the board have taken second and third part time jobs for this reason. You can also see if your current employer is offering any overtime, even in a different department that you might be able to work in.

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Shnapple wrote:
Another thought - maybe you can get a part time job until a majority of your CC debt is paid off?

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[Anonymous]

I am in the same boat.  I lost my job almost 2 years ago and cannot get employment not matter what I do.  My savings are gone as I have kept my bills up to date.  I consolidated my CCards to a low interest rate and decreased my other bills.  But, this one credit card is actually my son's but for some reason it is under my credit history, he was in college and fell ill.  He can no longer pay and I have been paying this account for the last 3 years but cann't any longer.  I was trying to renegotiate with them but don't know what kind of hit my credit will take once this account is closed by the CCard company.  Doses anyone know how many points it will hit and how long this will hurt me?

Thanks.