closing accounts (Amex)

It is not bad to close the account. Actually, it tells Amex you will no longer abuse the credit they gave you. The account will continue to accrue interest until it is all paid off, even if it goes to a collection agency.

so once it hits collections, the balance is frozen, right?

not at all, it continues to accrue interest until it is 100% percent paid off, no matter whom you make the final payment to!

well, that sucks. okay. guess I've got to figure out what to do. thanks for all this info!

no problem, amex will settle with you, you can try settling the account after 90 days delinquency. the best time to settle is right before it is sent to a collection agency, this is called ????charge off????. At this time you are looking at about a 50% savings, of course factor in the interest, late fees, etc.. for the months not p????id. if you join a debt setttlement program this money is on top of their fees. Best bet, settle the account yourself.

any idea on if they will take a payment plan for settlement or only the entire settlement paid at one time? there's no way I can have that much cash in 90 days.

When your talking about settlement, you are generally referring to a lump sum payment.

As Nascar said, usually if a settlement is agreed to, they will expect their money right away. However, I have seen a few posts on this site of creditors who allowed it to be made in payments. It doesn't seem like AmEx was one of them, but you could type their name in the search box at the upper right corner of the screen and read about others' experiences with them.

I know from personal experience that AmEx does offer hardship programs. Have you tried talking to them to see if you qualify?

kristen,

creditors have a range of anywhere from 2-6 monthly installments on settlements. The more months you are given on any specific settlement the lower the savings percentage. This explains the reason lump sum settlements yield more savings.

Have you looked into debt settlement coaching? Give pemper and gartle a look, excellent company to deal with and light years less expensive than joining a debt settlement program. They canhelp you prepare as to what to expect form Amex and what you should do incertain situations.

thanks everyone. I will also do a search on Amex on this site.

alias1958, when I called Amex, they said there was nothing they could do for me and to just keep paying the minimum payments (which I can't do). Which department did you speak with? How far behind were you in payments? What sort of hardship did they offer you? I have a large balance so there's no way I can settle in just a a few months.

My bet is that once you fall behind on your payments and the collection calls start, then they will offer you a hardship program.

I looked back through my notes with Amex to see exactly what they offered me. What I did was to send a letter when I knew that we weren't going to be able to keep caught up on our payments. I explained that we had experienced a loss of income and would be unable to make the payments. They ignored my letter, but when the collection calls started (at about 30 days past due), I told them that I had a hardship and had sent a letter. The collector put a request in for the hardship department to call me back. The hardship department called back the next day and asked about my situation, then offered me the hardship program. It was a six month program, with 9.99% interest rate, and $50 per month payments. My balance was only about $2000, so the payments would probably be higher if your balance is higher. I remember the gal apologizing that their programs were not as good as what Visa/Mastercard could offer and saying that they were working on trying to get better programs in place--so it's possible that they may have some better programs now.

If you aren't able to make the payments or do the hardship program, or come up with a settlement amount, you could just wait it out and see what they do. They never did threaten a lawsuit on either my husband's account ($10,000 balance) or mine, and we were about 120 days past due at the time we ended up filing BK. They did send my account to a CA at one point, but they pulled it back when I asked for the CAs address so that I could send a CD letter.