BOA & Chase settlement chance, plus credit score question
Date: Thu, 09/03/2009 - 11:15
1. I have been late with both Chase and BOA cc - about 60 days. Just made a payment and got current, but will probably be late again next month. Do you think they would settle with me - I have an opportunity to get a lump sum and would offer 80% - even that would help! If they see I'm starting to have trouble, will they settle for 80% do you think?
2. If they do settle, will it lower my credit score? My next step is to re-fi a mortgage at a lower rate and need that credit score as good as possible.
Well, to negotiate a settlement you need to get behind the payme
Well, to negotiate a settlement you need to get behind the payments. Most of the creditors won't entertain the idea of settlement if you can manage to stay current on payments.
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If they see I'm starting to have trouble, will they settle for 80% do you think? |
You can approach the lender if you face problems in repaying them. They may settle with you since it'd recover at least a portion of their loan. But for how much they would settle would depend upon your ability to negotiate with them. One may even settle for as low as 30% of the debt. Normally, you should start the bargain for little less than what you can afford.
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If they do settle, will it lower my credit score? |
Settlement would take its toll on the credit report. Moreover, the delinquency would also look ugly on the report, but once you settle the accounts the score would start improving.
If your goal is to re-fi a mortgage at a good rate in the near f
If your goal is to re-fi a mortgage at a good rate in the near future, and you can afford and 80% settlement, I would avoid settling at this point.
Try and get on a hardship program if you just need a little temporary help. And make sure they will re-age the account. This will remove the past negatives if you pay on-time for 3 months. I know Chase offers this, but I can't say for BofA.
I went through a couple settlements, and also have a Chase card in their hardship program. For me, the settlements actually improved my score because it balanced out my debt ratio some. But even still, those settlements show up in the payment history and a mortage company is going to look at all of that, not just the score. Even if it doesn't affect your score, it might still affect your rate.
Thank you! These answers have been really helpful and given me
Thank you! These answers have been really helpful and given me a lot to consider - I'm trying to be as practical as possible and get our family's financial house in order! Thank you everyone who answered.