Question about a collection agency offering settlement
Date: Sat, 11/25/2006 - 11:36
Need some quick advice. I had a credit card that went 120+ days past due b/c I had a financial setback, and now on my credit report it shows as "closed by creditor". I paid last month some of what was due. They already had a collection agency (that doesn't yet show on my report) offer a settlement of 50% off the full balance. Now the thing is that in my online account with the original creditor, I still receive a bill (next one is due in middle of December), and I can make payments online still. My questions are: Should the original creditor be able to accept payments online, even though they closed my account in my credit report--I thought once they charge it off, they can't deal w/you anymore. My other question is, do you think I should keep paying online until it's paid off (I'm in a better financial situation now), or should I accept the 1x settlement offer from the collection agency? Which would look better in my longterm credit report? Thanks in advance!
Until the debt is sold to outside collection agency, the credito
Until the debt is sold to outside collection agency, the creditor will always accept payments if you do and it has to be reflected in your file with the latest balance. Call the credit card company and inform the latest activity. They will check the system and correct if there are any errors on their part.
You must confirm with the collection agency that they have your file from the original creditor. They need to send the specifics about the accounts with the outstanding balance and copies you signed with your original creditor. If they are willing to offer a 50% settlement, get it in writing. It should also say that your account will be updated with the original creditor and a 'PIF' letter will be given to you after the debt is paid.
Thanks for the reply Trenity. Can the original creditor ever re
Thanks for the reply Trenity. Can the original creditor ever renig on the closing of my account---can they re-instate it based on + efforts by myself to pay as agreed in the future?
Well if it is already charged off then there really isn't much y
Well if it is already charged off then there really isn't much you can do to improve it other than by paying it. If you haven't ever settled an account before I don't suggest you do it if you have or had a good credit score until this account charged off.
A first time settlement could hurt your credit score inbetween 100-150 points. A first charged off credit card could hurt up to 100 points and cause other creditors to demand balance due in full.
I highly doubt you will ever get another credit card from that creditor again if that is charged off. Also credit cards general charge off at 180 days.
The collection agency might not report to the CBR agencies because they don't own it. But, depending on the size of the account, you can bet there was in inqury from them when they pulled your credit report.
Credit cards are intrest bearing account. They, by law, have to send you a monthly statement because they are charging you intrest, possible late and over the limit fee's. It should break it down for you on your statement.
If you want to pay the settlement, and 50% SIF is pretty decent for an account that appears to be fairly new to them, you should pay the agency not the creditor because it will be grounds for them not to close the account out as a settlement because it ask you to mail payment directly to them.
