By Admin on Aug 8, 2009 in Credit
PG asked:
I have credit card debt that I have the money to pay off. However, I heard that credit card companies will negotiate a lower amount, say $2,000 instead of $3,000 in order to get the cards paid in full.
I have credit card debt that I have the money to pay off. However, I heard that credit card companies will negotiate a lower amount, say $2,000 instead of $3,000 in order to get the cards paid in full.
1. Is this true?
2. Does this look bad on your credit report? Or does it even appear?
3. How does this work and how do you go about negotiating with them?
Thanks for your time!
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I don’t know if you, persoanlly, can do it, but credit counselors usually have luck adjusting them. I tried once and they wouldn’t budge for me.
Misery | Aug 12, 2009 | Reply
The account has to be charged off. and the amount that is usually dismissed is the interest and legal fees that have been added to the total.
Is the card in good standings? If yes than the answer is no.
credit king | Aug 14, 2009 | Reply
Yes you can negotiate settlement for less. You will get a 1099 for any forgiven amount over $600 (I think that’s the amount) and you will have to pay income tax on it.
If you are current on your credit card account, it is unlikely the credit card company will be willing to settle for less, particularly 1/3 less. It is more likely to work out a settlement on past due or accounts in collections. The older the collections, the more likely to settle for smaller amounts.
And the credit card company can note on your credit report that the account was settled which could affect your credit. Of course, the account would be closed.
You could call and make a settlement offer but unless you are a skilled negotiator, I don’t think you’ll be able to work out a settlement on an account that isn’t passed due.
bdancer222 | Aug 16, 2009 | Reply
1. rarely … they’ve heard every possible reason at least sixteen times over
2. yes. it is called a charge off. if you were charged off on one credit card, how many other banks do you think would be interested in giving you another one — within the next 7 to 10 years??
3. in your case, it likely won’t work. you’d have to lie. and since they’ve heard every excuse and every lie already, you’ll probably be detected.
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just pay up — honesty has a refreshing quality to it that pays dividends in the long run.
Spock (rhp) | Aug 19, 2009 | Reply