I Think I Did Good

[Jitterbug]

I just settled a charge off with a CA representing Citi for 40%. I verified with Citi directly that they still owned the debt, and that the CA was acting on their behalf. Here's the text of the letter I have....

Client: Citibank

Account number: xxxxxxxx

Balance: $7707.87

Settlement: $3084.00

Dear Mr. Xxxxxxx

Alliance One on behalf of Citibank will settle the above referenced account for the sum of $3084.00. This will release you from further obligations regarding this matter once the funds have cleared. Based on the arrangement set, and once Alliance One has received the agreed upon amount, we will request our client to notify the credit bureaus that your account is paid or settlend in full with a zero balance.

I have this on their company letterhead, and hand signed by their representitive. I sent a personal check via priority mail with a signature confirmation receipt. Once the check is cashed, I'll get it from my bank and file it with this letter just in case it's ever needed in the future.

Does anyone see anything I might have missed, this is my first settlement with several more to follow.

[CreditSuperstar]

Jitter-

I am new and may have to settle with one creditor as well. I am wondering however if your tradeline with this company should be deleted instead of "paid with a zero balance or paid in full"... can anyone else jump in and help here?

FCS

***GOOD LUCK***

[Jitterbug]

One other item of information on my situation.....

I filed for chapter 7 last year, and it was dismissed. I don't think it's fair that a bankruptcy filing will be on my credit report since I didn't get releif, but it's going to be there for 10 years anyhow. I'm told a dismissed bankruptcy showing on your credit report is even worse than a discharged one, because nothing is preventing me from filing again. On the other hand, my tactic, (which seems to have worked), was to tell them I'm considering re-filing for chapter 13. I told them my attorney and trustee agreed on a 25% plan over three years..... but if we can make a mutually beneficial agreement now, I would rather do that. Time is of the essence, so give me an attractive number quickly. (all BS by the way... I have no intentions of filing chapter 13) With this in mind, anything to help my credit rating is secondary to keeping the wolves at bay. Even if they report as a "Paid Charge Off", this settlement will be one less item I have to worry about ending up in court over.

[pursuit]

...once Alliance One has received the agreed upon amount, we will request our client to notify the credit bureaus that your account is paid or settlend in full with a zero balance.

Paid or settled in full.? That's no good.

Also, request our client. No good.

Also, I'm not sure about this, but if you recently claimed bankruptcy doesn't that mean you are "judgement proof"? Hence, no need to keep the wolves at bay...

[divemedic]

That means, that even if the OC follows the RECCOMENDATION of the CA, you now have a PAID CHARGEOFF on your record. Of course, the OC is under no obligation to follow the CA's decision and they are free to continue collection on the rest of the debt.

[Jitterbug]

I took the letter to say I was settling the debt, and it would be over and done with. I realize the CR tradeline is probably going to be a negative. I filed BK last year, and it was dismissed, not discharged. That means I'm fair game for collections again on everything.

[DocDon]

You did settle on the debt, an congrats for getting CITI to agree to 40%.

However, they knocked out two teeth and gave you a black eye in the process.

The idea here is to improve your credit picture - not just pay off debts. We don't tell people to skirt responsibility on valid debts, but we do tell them you'd better get something in return until FICO starts to recognize paid collections / chargeoffs.

So in reality, no, you did not do good - all you did was cough up money. Keep this in mind for any future settlements - negotiations work both ways, and involves more than just asking how much money they'll accept.

[Jitterbug]

I understand Doc. I guess since I have that BK on my CR's for ten years anyhow, but didn't get relief (which really stinks), I figured at least the debt and having to worry about what Citi can do to now that they know my BK attempt failed would be behind me. It seemed like the lesser of two evils.

On that note: I have another CC debt with Citi that they are willing to settle on the same terms. The kicker here is that this debt is almost $24,000. They will also take 40% to call it even on this one. Do you see any reason not to go ahead and take care of this one as well?

[DocDon]

Settling your debts when given such an opportunity can certainly be a positive. As I stated before, this board is not a "welch on your debts" board.

However, FICO hasn't caught up to the idea that correcting such condition is actually a positive thing.

The only thing missing from your settlement is getting the negative info updated /removed. Given you'd probably not get CITI to budge on their reporting, you should at the very least negotiate with them directly and negotiate a recall and deletion of the collection entry at the very least. That way, if they don't update their own reporting, you only have 1 negative entry to contend with instead of 2.

[Corrine]

I think Doc would tell you to get verification from CITI (not CA) that upon payment this account will be paid in full and deleted from your CR and that the remaining balance will not be transferred, sold or otherwise reassigned.

[Jitterbug]

Settling your debts when given such an opportunity can certainly be a positive. As I stated before, this board is not a "welch on your debts" board.

That's exactly why I've enjoyed reading this board. I see a lot of realistic information on how to cope with a bad situation, and find ways to work thing out.

Due to getting hooked on weekly trips to the casino, my wife and I went from money going in to savings each week, the mortgage paid with and extra $100 going on it each time, and an excellent credit rating, to being in over $100k of credit card debt in about two years. We totally screwed our lives, and have severely jeapordized our future because of this. Enough of my sob story. The debts are mine, and nobody put a gun to my head every time I pulled out the cards. My primary goal now is to get as much of the debt settled in as short a time as I can. I was able to cash in my 401k, and that's the funds I have to work with. I have to stretch it as far as I can.