balance 3 times the limit?

[payinbills]

What is the name of your state? Florida

As my wife and I prepare to attempt to buy a home, we have addressed all of our credit issues, paying off everyone we have ever owed money via credit report.

My wife had a credit card back in '99 that has since been charged off.

Here's the gist of the credit entry.

Chase N.A.

Opened: 6/1999

Balace date: 8/2002

Balance $: 2,155

High/limit: Equifax - $1488, Ex - $1120, Trans - $2155

Status: collection

Comments: Charge off, Purchased by another lender

We got in touch with them to arrange paying off, and they state we have to pay $3,398.85 to satisfy. They state she had an original credit limit of $1,120. From what I understand, the balance climbed and climed as she neglected to pay.

Someone told me that they cannot insist we pay that much. I have sent the first of 3 payments ($1132.95) via mail. Is there some other way we should handle this, other than just paying what they say we owe? Should I cancel this check before they cash. Are we being ripped off.

Appreciate any advice you can offer.

Thanks

Payinbills!

[mom23]

sounds crazy to me.

Usually they give you a lower amount to try to settle. I am sure you could have talked them down to a lower settlement offer. Especially if the SOL is up.

Are they going to give you a good standing with them for paying it off, or is it still going to show bad.

[payinbills]

thanks for the quick reply.

I had a feeling something wasn't right here.

We asked about a settlement amount, they said "no"

Please explain the SOL statement futher (if you don't mind)

I was under the impression that there is no way they would give me a good standing on something like this. Didn't even ask.

I felt we don't have a leg to stand on with this, I mean she used the credit card and never paid. Didn't think we were in a position to get what "we want". Am I wrong?

Payinbills!

[Corrine]

SOL is the Statute of Limitations to collect on a debt. I just checked and the SOL in FL is five years. The SOL starts running from the last date of activity or the date the account went delinquent. That means that technically, if the account went delinquent in '99, this company doesn't have the right to collect so much as a penny for your thoughts let alone the full amount for this debt so you'd think they would be happy about any type of payment you would offer at this point.

If I were you, (and the DOLA is '99) I would politely let them know that legally they have no standing to collect any money but that you will gladly offer a settlement in return for a deletion of the account from your CR. Otherwise, you will just as gladly wait the extra year for the debt to fall of your CR as the max seven year reporting meets it's end. Then just sit tight and see what they have to say. I'm thinking they will grow a brain quickly and take whatever you offer.

BTW.... Stop payment on this check and then offer less than before since they were too stipid to take your first offer. That'll show them you own the ball and the court at this point.

[payinbills]

wow. Shows what I know.

So because I still owe them money, they can't update my CR tomorrow saying that, as they did in 2002? Making it seven years from that date before falling off?

Thanks so much!!!

Sirmo

[score booster]

SOL refers to the time frame a creditor can legally sue and obtain judgment. A credit card is an open account. In florida the sol on open accts is 4 yrs. from date of last activity. If she has made no payments or promises to pay in the last 48 months, she is homefree. They may still sue, but if sol is pointed out, it will be dismissed. They may still report it though. I would stop payment on the check IMMEDIATELY. Send a dv letter to the ca first. If they can in fact verify the debt, but sol is up, you have a tremendous amount of leverage to negotiate! On an out of sol debt, it is not uncommon to settle for 20 or 30 cents on the dollar.

[score booster]

It's 4 yrs on credit cards in florida Corrine.

[Corrine]

My advice is based on the assumption that the account went delinquent in '99. If that is the case they legally can do nothing to collect the debt unless you verbally or in writing agreed to repay the entire amount. Did you ever agree to paying this debt in full? If you didn't the only thing they can do is continue to report the bad debt. I know with buying a house the lender will want you to address all the bad debts prior to closing so it's in your best interest to get these people off your report.

If you didn't agree to paying this debt and the DOLA is '99, I would immediately stop payment on the check and send them a letter CMRRR stating what I said previously and then offer less. I would also far less than what you would actually would be willing to pay. If you start out high they might counteroffer with something beyond your range. Offer say $500 (knowing you would actually go for $1,500). Let them counter with $1,000 and then tell them you will pay that amount but only in return for a deletion of the account.

[Corrine]

It's 4 yrs on credit cards in florida Corrine.

I wasn't sure what a CC was considered. I just saw the max for any debt was five years and figured he was safe either way.... barring that his most recent conversations with this agency haven't resulted in a verbal agreement to repay. That'll start the DOLA all over again and pretty much wipe out his bargaining chip.

[payinbills]

payment has been stopped.

Please bear with me, I am very ignorrant with this.

So the SOL refers to which date?

"Opened: 6/1999"

or

"Balace date: 8/2002

Balance $: 2,155"

My only concern is, we will be attempting to buy a home by the end of the year. And as our scores will reflect our irresponsiblity in the past, I want to be able to show that everything is cool now.

Therefore, we don't have time for this to resolve on it's own (assuming you talking about 48 months since the date last reported)

Sorry again, but please define dv and ca.

In other words, I have leverage, at this time, to not have to pay they full 3 grand?

You guys are awesome, I so appreciate it.

Payinbills!

[Corrine]

Okay.... the date the account was opened was in '99. When did she go delinquent on the account? Or in other words, when did she make the last payment? Her last payment is what starts the SOL clock ticking. The other matter is, did you agree to repay the debt either verbally or in writing? If you did the SOL clock started over on that date.

DV is Debt Verification.

CA is Collection Agency.

Since your home loan is months away you have some leeway time to negotiate with which is a plus on your side. The 48 months he is talking about is the time frame they have to collect on the debt. If that has indeed passed, you have the upper hand in negotiating a settlement in return for deletion.

[score booster]

You need to confer with her and see if she knows the last date she sent them a payment. The 2002 date is the last time the ca updated it. They can legally update once a month if they want to. Most don't. the 1999 date is when she opened the acct. If you pull all three credit reports you can likely find the date it went delinquent. Say the last payment was 6/10/2000. That would mean the next payment was due on 7/10/2000. In this scenario, the sol would be up 7/10/2004. But as I said, you must check the reports for date of last activity.

[retmar]

First off, you are not ignorant.

Look on your EQ report for the "Date of 1st Delinquecy". The SOL will start from there. On your EX, it should be the one titled "Reported Since".

You will have to check your state's laws to see if a verbal or written agreement restarts the clock.

You do want to request DV to assure they are attempting to collect only legal amounts, not "extras".

Once you have started your inquiry is when you start watching for them to blow it. Not to totally avoid paying, but, to gain an edge for a settlement for a lesser amount.

Also, if you are sure the debt is legit and want to pay it off, do not hesitate to offer a settlement for around $.25 on the dollar. They will counter with a "NO, we want all of it", or they will counter with maybe $.80 on the dollar. Then you counter back with $.30 and they should settle for maybe $.60. these are just example, nothing more. If they do want all, then send the DV.

It is entirely up to you as to how you want to proceed.

[retmar]

First off, you are not ignorant.

Look on your EQ report for the "Date of 1st Delinquecy". The SOL will start from there. On your EX, it should be the one titled "Reported Since".

You will have to check your state's laws to see if a verbal or written agreement restarts the clock.

You do want to request DV to assure they are attempting to collect only legal amounts, not "extras".

Once you have started your inquiry is when you start watching for them to blow it. Not to totally avoid paying, but, to gain an edge for a settlement for a lesser amount.

Also, if you are sure the debt is legit and want to pay it off, do not hesitate to offer a settlement for around $.25 on the dollar. They will counter with a "NO, we want all of it", or they will counter with maybe $.80 on the dollar. Then you counter back with $.30 and they should settle for maybe $.60. These are just example, nothing more. If they do want all, then send the DV.

It is entirely up to you as to how you want to proceed.

[payinbills]

Thanks retmar.

We have no idea when it went delinquent. She can't remember. All we know is on her equifax credit report they set a balance of $2,155, and account status of "collection" in 08/2002. DOLA says N/A. So it apperently went delinquent before 8/02

So from what I understand, It is very possible that the SOL clock restarted when she called them the other day and made the arrangement to pay the $3398 in the next 3 months.

I guess my next step is to find out if the clock restarted?

And I'll work on this DV stuff

Retmar, I agree 100%, I don't want to totally avoid paying, but look like the edge on settlement.

[KentWA]

WAIT...... This is very interesting, Chase is saying on your credit report that it was "purchased by another lender", yet they are taking a settlement? If it was in fact purchased by another lender, they have ZERO standing to collect a single penny. If in fact it was not purchased, they are violationg the FCRA.

[payinbills]

Sorry, false alarm. It doesn't say "purchased to another lender".

It just says charge-off.

[retmar]

Get it done! You're on the right track.

[payinbills]

thanks for the continuing support retmar!

Here's where I'm at. Chase is the OC, so not sending a DV. Instead I have drafted an "agreement to compromise debt".

They say I owe $3398, and I've offered to pay $1120 (the original credit limit) with agreement to

"notify all Credit Reporting Agencies that account is PAID AS AGREED, and delete any entries showing this account as ever being late, or remove the corresponding trade lines completely."

Will send to the address I sent the check I stopped payment on with a self addressed envelope. Sound good?

If sol is up, they should be WAY happy with the $1120. Which I don't mind paying, cause thats what I spent.

If sol got reset by sending them a check (even though I stopped payment) they might take the deal anyways.

How'm I doing?

Thanks!!!!

Payingbills!

[retmar]

All they can do is counter or say no.

[payinbills]

Or sue me I guess (if I reset SOL) But I'll pay it all before that happens

Payinbills!