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Capital One & Providian Debt Settlemnt


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This is my first post and I have to say I have learned so much in the past week reading the posts! I ordered all my credit reports and I found 2 debts that are mine and I want to settle and pay. They are to Providian and Capital One for about $500.oo each, however with all the late fees etc they are now both over $1000 each.

This morning I took teh day off from work to call all these creditors and write my validation letters and I have to say it feesl good with how empowered I am after reading this board.

Anyway, here is what happened with our friends at providian and Capital One. Oddly enough it was very very difficult to talk with someone at both companies as I explained I was ready to pay them their money. Belive it or not most of teh low level customer service reps sent me to the 3rd party CA and woudn't even talk to me or even put me in contact with someone in their organization that would take my money!

With Capital one they referred me to the CA and since the CA does not have an entry in the CR's I sent them off a cease comm in hopes that will make Capital One work directly with me. I will keep ya posted on how that goes.

Providion, on the other hand I was able to get in touch with a Assitant Supervisor in Recovories and without even saying a word Providion offered a settlemnt for $545.00, I figured that was fair and it was the highest limit the account ever was anyway. So I said OK, they informed me teh account will read "paid as agreed" I figured wow, this was easy. But wat one second I probed some more about the how the CRA entry would read and the nasty supervisor informed me that it will still read as a charge off and all teh delinquent entries will stay! once I heard that I said NO WAY! so please be carefull I got the impression that these folks at Providian are on to debt negotiations. So I went ahead and sent my restrictive endorsement via fax and I don't expect to hear back from them since teh Supervisor informed me that any documentation I send to them will have to be reviewed by their legal dept., what a joke! Anyway any advise on a next step for me would be helpful.



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Here are several excerpts from my next eBook "How to settle your debts yourself" (it's almost done) which I thought would be helpful for you:

Settling With Collection agencies

How do you tell if your account has been turned over to collections? Your credit report is an excellent place to start. If you haven't already done so, getting a copy of your credit report is crucial.

Once you get your credit report, find the debts on the report that you are interested in settling. The report will say next to the account:

Ø[TAB]Account turned over for collections, or

Ø[TAB]Account sold, or

Ø[TAB]Account charged off

Ø[TAB]Will say nothing at all, but give late payment dates

Obviously, if it says the account has been turned over for collections, it has. If your account listing falls under numbers 2 or 3 above, or just says nothing, you may have to contact the original creditor to find out the status of the account.

If you feel your account is with a collection agency, before you try to settle, try debt validation before offering a settlement. By using debt validation, you may be able to avoid having to pay this account at all.

What makes a creditor say 'yes' to a debt settlement?

In very rare circumstances (like never) creditors agree to help you out of your debt problems because they are nice people. Creditors agree to a plan because they may feel this is their only chance to get money from you. Their thinking is that some money is better than nothing. You can help this impression along by hinting that your only other option is declaring bankruptcy. However, no matter what you may hint or flat out state to them, creditors have their own ways of determining if you are teetering on the brink of bankruptcy.

What if they make you an offer

Sometimes the creditor may make you an offer to settle the amount. When this happens, you can be sure that you can get a better deal than the one offered. If this contact is by phone, listen carefully, get the rep's name and direct telephone number and the company address to which you will be sending your settlement.

After you get off the phone, or review the letter, come up with your own offer and the use the sample letter "Counter Offer" in Appendix A.

If you have been getting a series of letters from the credit card company and the offer keeps getting better, you may be wondering at what point should you take it as a viable debt elimination solution. Keep the basic rules in mind - most creditors not go below 30%-50% of the original balance, so if the offer approaches these figures, you should consider accepting one of them.

How much should I offer?

Each creditor is different

Like any other industry, each company in the credit card industry has its own debt settlement policies. You may be able to settle with one company for 30 cents on the dollar with one and 75 cents on the dollar with another, even though the amounts of the debt and the terms of the repayment plan are identical. Don't get stuck on this point. If a creditor is immovable in their settlement policies, it's because of internal policies written in stone from the dawn of time. Accept the offer, move on and spend your time on a creditor who is more willing to work with you.

Lump sum offerings

Obviously, if you are going to give your creditors cash, they will be much more interested in working with you. You will always get a better deal when offering cash. As a matter of fact, you may not get ANY deal if you offer includes a payment plan. What if you don't have any cash? We'll cover that in a minute. However, if you have cash, you can usually get 30-50% reductions in the balances of the debt you owe, sometimes even lower. Again, as we stated above, we are in no way guaranteeing that getting this kind of reduction is guaranteed.

If you have to accept an imperfect credit listing as part of your settlement

You may find that some of your creditors are willing to hold out longer than you are before agreeing to delete the negative listing from your file. It may seem that they are unwilling to delete the negative listing under any circumstance. Once again, let it be said that every creditor will eventually give you what you want if you speak to the right person, are patient and persistent, and make the right offer. But if you are on a time-line, and your attorney can't get them to agree to full deletion, you have a couple of other options:

List the account as "Unrated". Many times, a creditor will agree to list the account as "unrated". What does this mean? It means just that, the account is not listed as good or bad. As far as we can tell at the time of this writing, an "unrated" notation for an account does not negative impact your score. However, if the listing is unrated, make sure that any lates on the account are removed, as these lates WILL have a negative affect, even if the account is unrated.

List the account as "Paid" only. You may counter-offer for the creditor to list the account as "Paid" rather than delete it altogether. This is a true indication of the status of the account and many creditors will concede and agree to this wording. A "Paid" status is still very negative for a collection account or an account that will show "Paid Charge-off" or "Paid Repossession." You should insist that the account show "Paid" only and that all other negative notations (such as "Charge-off," "Repossession," late notations, or "Collection") are deleted at the same time. A simple "Paid" notation on a regular trade line is neutral and should not hurt your credit.

List the account as "Settled" only. You may counter-offer that the creditor simply lists the account as "Settled" rather than delete it altogether. "Settled" is an inherently negative listing but not as negative as "Paid Charge-off." Don't agree to a "Settled" listing until you have exhausted all other possibilities. "Settled" will still trigger a credit denial. You should only agree that the account show "Settled" if all other negative notations (such as "Charge-off", "Repossession", late notations, and "Collection") are deleted at the same time. If you agree to a "Settled" notation, you must continue to work hard to delete the notation through the credit bureau dispute process.

List the account as "Paid Charge-off" or "Paid Collection" or "Paid was 30-, 60-, or 90-days late." This will be the creditor's first choice, and your last choice, of what to place on your credit report once you have paid. These notations are almost as damaging as showing the same debt unpaid. It is very common, though, for an account to be deleted (through credit bureau disputes) once it has been paid. The creditor now has no compelling reason to keep the negative listing on your report. For this reason, it is still usually a good idea to settle even if the creditor won't budge on deleting or positively modifying the negative listing.

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