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MBNA Settlement


kevinf
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My fiancee currently owes $6600 on a MBNA account. She has been many months late throughout the life of the account and also has other accounts that are late. Basically, I'm pretty sure her credit rating is not very good.

MBNA has offered to settle the account for $4440. They aren't willing to list the settlement as paid as agreed or anything else more positive so it's going to be listed as settled.

My question: is it a good idea to take the settlement? I know that it will be negative on her CR but is it really going to make that much of a difference? Sure could use the extra $2000!

Thanks for your advice,

Kevin

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At first glance, this situation sounds like a tough one.

But there are also a lot of factors involved.

Does your fiancee have $4440 buring a hole in her pocket (or in yours)?

If she really does have that many Ben Franklins lying around, then why was she late in the first place?

I know that is a rhetorical question, but the point is whether or not that money is really available in the first place, especially since many other accounts are late.

But here is the real question.

Is the account closed or is it still open?

I find it hard to believe it is an open account because once an outfit is willing to settle with you, they have already closed the account.

A charged off account is a totally different story than an account with lots of late payments.

I have never made a single late payment on my Best Buy account ever since I got it five years ago. They pulled an account review and saw how heavy my debt was and they closed the account. I never made a late payment in five years.

As a result, I suspect this account is closed.

Next, what other accounts does she have that are either charged off or in a situation that they may be closed?

And how much in cold hard cash does she really have just lying around collecting dust?

Once more of the details are available, it might help giving better advice.

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Thanks so much for your help.

Does your fiancee have $4440 buring a hole in her pocket (or in yours)? If she really does have that many Ben Franklins lying around, then why was she late in the first place?

Well... I would be paying the debt off for her. We don't have a lot of extra money but I thought it would make the most sense to pay off the debt because she is being charged 22% interest and I have good credit and could always borrow money under better terms if we have to.

Is the account closed or is it still open?

As far as I know, the account is still open. She hasn't made a payment in the last 3 months or so, so I believe it's probably on the verge of being closed or has just been closed.

Next, what other accounts does she have that are either charged off or in a situation that they may be closed?

She has an Amex optima with a $6000 balance in a similar situation. The MBNA and Amex are her only 2 charge accounts but she has very large student loans that do not have a great payment history.

And how much in cold hard cash does she really have just lying around collecting dust?

Like I said earlier, we don't really have a lot of money but I have about $10000 that I thought we would use to pay off her two credit cards. And in the future, if we need more funds, I would borrow the money on my better credit terms.

Once again, thanks!

Kevin

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  • 3 weeks later...

Don't do it!!!! I'd think twice before I walk down the aisle. I had a fiance that was a lot like yours. She was my wife of 10 years and her spendthrift ways ruined me.

Remember, too, that if you take the deal your fiance will have $2200 in additional income. Can she afford the taxes on that? Can you, if you marry and file jointly in the year the 1098 is posted?

I would attack the student loans. Most lenders and guarantors can help you out with those, especially if she is behind.

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