Discover card advice- avoiding charge off - possible settlement or long term payment plan
Date: Sat, 04/17/2010 - 16:36
(Sorry for the long post. Just trying to give the entire picture.) :confused:
My girlfriend has been out of work several months. I was out of work several months and then severely underemployed another 6 months.
However, with the help of family I have been able to negotiate at 20% settlement with BofA (owed about 45k) and 40% with Citi (owed about 13k). (The final of 3 payments will be made to them in the next few weeks.) I also have made minimum payments on a credit union acct and they have just re-cycled my acct so that I am no longer behind.
I have a property that is in foreclosure but I am trying to arrange a short sale to get rid of it. My credit score is down to 498, but hopefully will improve pretty rapidly in the coming months since my other accounts will all be current.
I have no significant assets, but my family could help me out (as they have been for the other settlements) in order to get something done with Discover.
I have been able to avoid any charge-offs thus far, but I have a balance of about 17k with Discover. I signed up to be put on their hardship payment program several months ago (5.9%, 12 months), paid about $300 and then $170/mo for a month or two. Then, I realized that I couldn't keep making even those payments on my own and haven't paid anything for the past 3 months or so. Going from my original discover dates, I would have been about 240 days past due by now. I'm not sure if the few payments that I sent them affects my days past due.
Lately, I have gotten some better work and am in better financial shape but still can't really afford to make payments to Discover, especially with my girlfriend still looking for work.
Discover says they can't put me on any other settlement or long-term payment program because I am already on one. Last week I got a call from someone in Discover's 'charge-off' department, which he said is the last department before the balance charges off. I originally wanted to try to settle with them for 40 or 50%, but they have continually told me that is not an option - pointing out that the balances consist mainly of balance transfers from other cards. Lately, I have told them that I would pay them the *entire balance* if they could put me on a 5 year payment plan at a low interest rate, but they say they can't because I'm on a plan already. They tell me that I need to make the $170/mo payments until December and then they might be able to put me on a 5 year plan. I feel like they are just telling me whatever they can, dangling a carrot in front of me to get me to send money only to keep all control over how much they screw me later.
Can anyone give me their insight?
Would making the hardship payments improve my chances of settling or getting a good long-term payoff - or would it hurt my chances?
Am I better off letting the account charge off? Or, should I still try to avoid it?
I'm concerned that if I scrape the money together to send them the $170/month that they will just tell me in December that my new interest rate is 25% and then I'm really screwed.
How hard of a stand I should take? :(
Thanks in advance!
My girlfriend has been out of work several months. I was out of work several months and then severely underemployed another 6 months.
However, with the help of family I have been able to negotiate at 20% settlement with BofA (owed about 45k) and 40% with Citi (owed about 13k). (The final of 3 payments will be made to them in the next few weeks.) I also have made minimum payments on a credit union acct and they have just re-cycled my acct so that I am no longer behind.
I have a property that is in foreclosure but I am trying to arrange a short sale to get rid of it. My credit score is down to 498, but hopefully will improve pretty rapidly in the coming months since my other accounts will all be current.
I have no significant assets, but my family could help me out (as they have been for the other settlements) in order to get something done with Discover.
I have been able to avoid any charge-offs thus far, but I have a balance of about 17k with Discover. I signed up to be put on their hardship payment program several months ago (5.9%, 12 months), paid about $300 and then $170/mo for a month or two. Then, I realized that I couldn't keep making even those payments on my own and haven't paid anything for the past 3 months or so. Going from my original discover dates, I would have been about 240 days past due by now. I'm not sure if the few payments that I sent them affects my days past due.
Lately, I have gotten some better work and am in better financial shape but still can't really afford to make payments to Discover, especially with my girlfriend still looking for work.
Discover says they can't put me on any other settlement or long-term payment program because I am already on one. Last week I got a call from someone in Discover's 'charge-off' department, which he said is the last department before the balance charges off. I originally wanted to try to settle with them for 40 or 50%, but they have continually told me that is not an option - pointing out that the balances consist mainly of balance transfers from other cards. Lately, I have told them that I would pay them the *entire balance* if they could put me on a 5 year payment plan at a low interest rate, but they say they can't because I'm on a plan already. They tell me that I need to make the $170/mo payments until December and then they might be able to put me on a 5 year plan. I feel like they are just telling me whatever they can, dangling a carrot in front of me to get me to send money only to keep all control over how much they screw me later.
Can anyone give me their insight?
Would making the hardship payments improve my chances of settling or getting a good long-term payoff - or would it hurt my chances?
Am I better off letting the account charge off? Or, should I still try to avoid it?
I'm concerned that if I scrape the money together to send them the $170/month that they will just tell me in December that my new interest rate is 25% and then I'm really screwed.
How hard of a stand I should take? :(
Thanks in advance!
Completing the hardship program might improve your chances of ge
Completing the hardship program might improve your chances of getting a good settlement offer from them later. However, It's out of question since you can't make the payments. Letting the account to go charge-off would hurt your score but it might help you in getting better settlement deal from the collection agency since the CA would buy the debt for pennies.
Anyway, if you still try to negotiate with Discover, try to speak to someone up in the ladder and also make sure to receive their promises in writing.
