Need your opinion paying off loan...

[DebtAlarm]

I have an old private student loan from Wachovia now WFargo. Last payment was made sometime in 2004. I recently got an offer from WFargo which states if I pay 20%, they will report account settled.

Reading all the post here it seems they will keep coming back if I don’t take up on this offer.

I would appreciate any suggestion..

Thanks

[StudLoanGuru]

Depending on the state you live in, you would probably want to explore the Statute of Limitations of this loan. If the SOL runs out, the loan cannot be reported to your credit bureau and they cannot come after you (litigation, judgement, lien, garnishment). It is rare for a company to offer such a low settlement on a student loan, so I would assume it is getting very close to SOL, if not already there.

SOL does not discharge the debt, but does prevent anyone from forcing you to repay it and report to credit bureaus. This is probably a last ditch effort to try to get some of their money back.

I am never one to condone running away from incurred debt, but in this situation if in fact the SOL is up your credit would be better served not paying it, because if you do settle the debt they will report this delinquent account for seven more years, where as if you don't pay it at all, it will fall off naturally from the SOL.

[1stStep]

Since the OP didn't list their state of residence, it'd be hard to say what the SOL is...

Guru is right, but I'd add that the OP should contact a lawyer to make sure that the loan is/isn't SOL, and if it is, that they get a written agreement that extinguishes the debt after paying off the 20%.