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Posted: Tue May 27, 2008 10:15 pm Subject: Negotiating with Bank of America

I am 6 months behind on my payments to BOA and owe them $9700. Obviously, I have received numerous phone calls (which I've avoided) and letters (not answered). Today, I received a letter that stated this is their last attempt at this debt and that it will be turned over to a CA on June 1st. I haven't made any payments since Nov. 2007. I would like to settle with them for 30%-40% of the balance. However, I will not have the money to send to them for 60 days. Can I negotiate a settlement but not pay them for that long? My husband is going to pull money from his 401K so we can get this paid off but his 401K said it can take up to 45 days to process. Any suggestions on how to handle this? I am planning on calling BOA tomorrow to offer my settlement.

TIA,
Kim

Posted: Tue May 27, 2008 11:21 pm Subject:

Oh, I forgot to mention this is an unsecured credit card debt.

Posted: Tue May 27, 2008 11:40 pm Subject:

I see no fault in trying. You can always make the settlement proposal to them. Its actually better to deal with the original creditors than dealing with the collection agencies. But in order to make them the offer, you have to quote a reasonable amount, say about one-third of the debt or more. Most of the lenders will agree to settle the account between 50%-70% of the total loan amount.

If you don't have immediate fund to settle the account, you can ask for a repayment plan. But while negotiating, always show your eagerness to pay-off the debt.

Posted: Tue May 27, 2008 11:59 pm Subject:

It is best to settle with the original debtor. They have their interest in mind, in my experience they wanted to drop all the charges they added. But they are greedy.

Guest · Posted: Wed May 28, 2008 12:26 am Subject:

I tried to settle with BOA last year. I offered to pay the full amount owed on my credit card if they would either lower the interest rate or eliminate the interest until I could get it paid off. They refused to work with me, so I had no other choice but to stop making payments. In December they charged it off and sold it to a collection agency that is trying to collect on it now. I have no assets and my only income is from social security.
It is difficult to understand why Bank of America would not work out something with me that would not only help me but they would be getting paid their money as well. Must be greed on their part. Good luck on your negotiating with them.

Posted: Wed May 28, 2008 4:39 am Subject:

Your social security benefit is exempted form garnishment, unless you have saved quite a substantial amount on your account. However, amongst the exceptions the following can garnish even your social security benefits;

Federal tax Bills
Child support and alimony
and, Any form of Non-tax Federal Debts

If BoA doesn't agree with your settlement proposal and charge-off the accounts, you then have to deal the matter with the collection agency and work out a settlement plan with them. In such case you can even take the help of a professional consultancy firm.

Posted: Wed May 28, 2008 5:34 am Subject:

Personally I wouldn't try and negotiate until you have the funds because sometimes they come with a deadline of the offer expires.

Posted: Wed May 28, 2008 9:05 am Subject:

That's the only problem though...if I wait until I have the funds, it will be with a CA instead of the original creditor. Would the CA be willing to give a better deal than the OC?

Guest · Posted: Thu May 29, 2008 1:06 am Subject:

Depends on how much the CA pays for the account.

Posted: Thu May 29, 2008 2:56 pm Subject:

Kimberly, After the account is turned over to a CA for collection,you can always go back to BOA and attempt to negotiate a settlement. When you have your money in hand, call BOA. Tell them you refuse to deal with a CA.

They will accept a better settlement offer a few months down the road anyway.

I don't know how long BOA tries to collect before selling the debt.

Posted: Thu May 29, 2008 3:37 pm Subject:

I don't think BoA keeps their papers long. We had thought we had cancled an account with them. We were negative 2 dollars then they added their fee's for 3 months then sold it to NCO.

Negotiating with the creditor doesn't stop them from sending it to collections unless they are recieving payment and even then if it is outside of the terms of the original contract it can still be sent to collections.

Guest · Posted: Fri May 30, 2008 1:17 am Subject:

BOA doen't keep the accounts very long, they charge it off and then it is sold to a CA; once it is sold you cannot deal with BOA. You have to deal with the CA that bought and now owns the debt.

Guest · Posted: Fri May 30, 2008 3:52 am Subject:

After charge off,the original creditor usually assigns the debt to a CA for a few months before selling the debt.

I know there are probably exceptions, but most make an effort to collect the debt before selling.

We settled with BOA before charge off. If I had it to do over, I would have waited a few months before trying to negotiate.

Guest · Posted: Fri May 30, 2008 3:53 am Subject:

Oops, forgot to sign in.

Posted: Mon Jun 02, 2008 6:39 am Subject:

Thought I would update what happened when I called BOA. Honestly, they were really nice to work with. When I called, they offered me a payment plan or a settlement of $2400! I didn't have to negotiate, that was their offer. I accepted the settlement, gave them $100 with the agreement that the rest will be paid within 60 days. They told me if something happens, just let them know & they will work with me. Feels good knowing this will be all done. However, the one bad thing is they put the debt on my husband's credit report as well even though he was only an authorized user, not the primary person. I called them the next day & they told me that they will remove it from my husband's credit report & that it could take up to 30 days.
All in all, I'm very happy. We decided to refinance our house instead & now I will start the settlement process with the other 4 cards I had. Hopefully, they will be as easy to work with as BOA was.

Thanks for all of your replies!

Kim

Posted: Mon Jun 02, 2008 1:54 pm Subject:

WoW, BOA offered to settle for 2400 on a 9700 debt.

I would say that is a very good reason to be pleased.

They were not that generous with us when we settled with them in 2006.

They offered to settle for 75% and refused to budge.

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