Jump to content

Having problems settling your credit card?


sifxpert
 Share

Recommended Posts

Can anyone give me any insight ast to how to get payment arrangements and a better deal on settling with Premiercard? They offered to seetle for 60% but say it has to be one payment. They also say they will report as settled for less (which is nearly as bad as charged-off from what my banker told me)

I also want some help with Plains Commerce Credit Card? They sent me a card, appear to have lost my fist payment, and then racked me for fees and when I asked to get them removed they say they don't remove fees. I would like to just settle with them and call it a bad experience.

Thanks in advance.

Link to comment
Share on other sites

Not sure if most are aware that you ARE legally liable for taxes on ANY amount of forgiven debt. It is considered the same as money given to you as far as taxes go. Also, lets say that you have property repossessed by a creditor and he sells it for less than you owe? You not only still can be sued by the creditor for the difference, but he is required to report the difference to the IRS and you will be taxed on it. Unless you pay the creditor and prove this to the IRS you will be taxed. (Example: You have a $25,00o loan on a car and it get repossessed and sold at auction for say $15,000 to cover your debt. You will be reported to IRS for the $10,000) I live with an IRS tax examiner, so trust me it is true and while many have been ignoring the law, the IRS is taking a hard line and making any who fail to report liable, so the banks etc will be doing it more soon!

{"willingtocope"]Ouch...everyone needs to go look at...

http://www.irs.gov/pub/irs-pdf/i1099ac.pdf

...its basically saying that an OC, CA, JDB should issue a 1099c for their portion of "forgiven" debt. And it also affects the SOL defense.

Link to comment
Share on other sites

Personally, my experience is that the majority of Credit unions have now grown into nothing than big fat banks with less federal oversight. They use all the same credit requirements, and very few have any real credit managers but instead (just like most banks) the computer does all the thinking. It used to be that you could get a loan or credit card at a credit union with less than perfect credit, but if your credit is shaky or bad you better have a savings account balance large enough to cover a loan or credit card ot you won't be getting it. The days someone being able to go into their bank or credit union with documentation on illness or another explanation of past debt problems is long over. I have friends who work in credit banking ay both types of institutions and I can tell you that their two largest complaints are, FIRST: that their title of "CREDIT MANAGER" is no longer remotely correct, and that they have become little more than a secretary for what the computer spits out, and SECOND: That they are all treated like potential theives ready to dip into the till at a moments notice. Even when they are able to approve a loan, they have to get so many secondary approvals its stupid. I won't say you CAN"T find a credit union that will work with you, but if you do post it because that type is few and far between and I'd have to challenge the validity of anyone who says they have a sub 630 credit score and says they obtained or can obtain for others a credit card from a reputable bank (not one of the so-called banks offering $300 limit credit cards for a $175 fee) or a credit union without securing it with a savings account, IRA account or other means of guarantee.

2. I'm not understanding this one...you have never seen 40% or you have never seen a CC ask to see other settlement letters before going down to 40%?

a) most creditors will settle for 40% on the average.

Never seen a 40% (but readily admit that I haven't seen everything. ;) ) Also, most CC want to see other settlement letter before they will go below 75% settlement.

B) some creditors will ask to see letters from other companies when you call and say "well, MBNA offered me 30% or Providian offered 40% so why won't you go doen to 40%?" they then say well send a letter that reflects that amount and we will consider. They are trying to call your bluff...happens often.

I've had many that refused to budge below 60% - and have said (in a rude voice) that their tax deductions are equal to 60% of the balance so why should they bother. 60% is actually correct as far as the tax deduction in some cases (profit and loss deductions).

3. I agree that Credit Unions are very good. Some are not but for the most part I agree they do business very professionally. I do not remember a time where I posted anything negative about credit unions. I do recall a post where I mentioned something that credit unions are one of the only institutions allowed to touch money in another account if you default on a loan...not that this is a bad thing for them to do but, doesn't it suck when you go to the bank and nothing is there?

I thought you were recommending against them. My bad if I misunderstood.

I apologize if you feel I misrepresented something here. I do appreciate any constructive criticism. I want nothing more than to keep my words as accurate as possible since they may have a serious adverse effect.

Don't EVER be afraid to call me out on something - I do make lots of mistakes and the credit information world is an ever moving target. I appreciate all of your info.

Link to comment
Share on other sites

I have been trying to Negotiate with Capital One for almost a year. They charged off my account last Sept,05. (the balance is about $3500) They have offered a settlement of $2800 but stated specifically they were gunna report it as a R-9 debt settled for less that full balance. I stopped NCO (the CA) from collecting and have written a few officers and finally the chairman. I have been getting the same response..."we can't help you, thats the best we can do".

In my letters I have requested better terms on the reporting or reinstating my account. Any better ideas or advice?

Link to comment
Share on other sites

DocDon, you said

This has nothing to do with charging off the debt.

You're right, but the FDIC rules do. The FDIC says that an FDIC insurred institution must charge off a non-preforming debt at 180 day (or less), set the balance owed to $0, and take a charge against accrued profit. On the other hand, the IRS allows the debt to stay on the OC, CA, or JDB's books for 36 months plus the end of the year after the last "identifiable event".

So...first off, since credit cards are really issued by Mastercard, VISA, AMEX, and Discover which are NOT banks (although they may license their processing to a bank) and I'm still not sure if the licensee qualifies as a bank, I'm still not sure that FDIC applies to CCs. And then secondly, the IRS seems to imply that whoever owns the debt can keep it on their books for almost 4 years after their last attempt to collect.

It really is still such a confusion...

Link to comment
Share on other sites

The FDIC applies to credit cards. Credit card issuers are Limited Issue Banks. They issue credit cards backed by a Parent Bank. I already posted the verbiage showing that.

I also showed you where the section of the IRS code you pointed out was located under "When A Debt Is Cancelled".

I'm not sure how else to explain it. Even if you go to a CC website (like Cap1 for example), you'll see "FDIC" right at the bottom of the site. :)

Link to comment
Share on other sites

DocDon. Okay, agreed. I guess what we're going to have to say in the future is something along the lines of...

According to the FDIC rules that appear to govern banks that issue credit cards, a bank must charge off a CC debt at 180 days (or sooner), take a loss against their P&L, and report it as CO to the CRAs along with a balance of $0. But, it is unclear what penalities they might face if they fail to so so, and, a debtor cannot use the FDIC rules as a basis for a law suit. Also, it is unclear as to whether or not they are breaking any laws if the continue to charge interest and penalities and continue to attempt to collect on their own, use a CA, or even sell the account to a JDB. And, according to IRS rules, if they don't sell the debt, they can continue to keep it on their books for almost 4 years after an "identifiable event" (such as they cease collection efforts) occurs. What is clear is that none of this relieves the consumer of liabilty for the debt. In most states (except perhaps WI), even expiration of the SOL doesn't do that. And futhermore, if you use the SOL defense in court to avoid liabity for a debt, you should expect a 1099c from whoever owns the debt...you might have to pay income tax on the "forgiven" amount. Even filing for BK 7 doesn't avoid the 1099c; however, because you must be insolvent to file BK 7, it appears unlikely that you would be subject to taxes.

Did I leave anything out?

Link to comment
Share on other sites

I beleive some SOL's may be as little as 3 years...and, I haven't heard of anybody getting a 1099c for using the SOL defense as yet, but then again the IRS just issued their new guidelines last year. See item 3. at the top of page AC-3... http://www.irs.gov/pub/irs-pdf/i1099ac.pdf

Also, I personally have received 1099c for debts that were IIB. I'm guessing I don't owe taxes on them because of the BK7, but it is just another hassle.

Link to comment
Share on other sites

Worked my way through all my other settlements, but UNIFUND is being particularly difficult. Original Debt w/Citi for 1633.00 and UNIFUND offered 1143.00 last month but now it's goneup to 1367.00. They are extremely RUDE, unhelpful and won't budge. I've asked you about this before to no avail.... I'm exhausted. If you have any names or input, please help! Anybody???

Link to comment
Share on other sites

Worked my way through all my other settlements, but UNIFUND is being particularly difficult. Original Debt w/Citi for 1633.00 and UNIFUND offered 1143.00 last month but now it's goneup to 1367.00. They are extremely RUDE, unhelpful and won't budge. I've asked you about this before to no avail.... I'm exhausted. If you have any names or input, please help! Anybody???

Unifund sucks which you have found out. I never settle with them directly. If I have to, i will settle when the account is assigned for 30%. I do my best not to ever settle JDB accounts but if I have to I always wait until they assign it. DV them and they will send it out elsewhere.

Link to comment
Share on other sites

Can you tell me how to settle with mbna for 25%? Im currently on a reage but maybe a debt settlement with PAYED as Agreed may be better.

Playmaker

What you do with the account is your decision. If you settle prepare for 1009-c tax consequences with MBNA. They issue every time. You can get 25% with MBNA if you work them but the account must be delinquent between 150-180...personal loans with account numbers beginning in 749 are between 180-210 days.

Good luck!

Link to comment
Share on other sites

Sifxpert,

I've read your opinions on this board for several weeks - going back to 2005 and 2004 - and I would appreciate your advice.

Brief Background: Two old Discover Card accounts, charged off and sold around 2001 or 2002, both within SOL (Michigan is 6 years). Each was around $2,500 each, both have been inflated to $5,000 each.

Assett Acceptance owns one, Credigy owns the other. Credigy didn't show up on my credit report until recently, received the collection letter (from a local Michigan attorney), and DV'ed him twice (within 30 days) - 1st response for validation info. was insufficient. This was about 2 weeks ago.

I've disputed (unsuccesfully) with the CRA's about Asset, and I have yet to dispute Credigy. Will do so in about 2 weeks, once I receive my last round of disputes back from the Big 3. Haven't DV'ed Assett yet, although I have written them about descrepncies on my credit reports with the help of a local consumer attorney in my area. (It was more of a demand letter rather than a DV for removal of inaccurate information. I guess this would serve as the same thing as a DV.)

My Questions:

1) A lawsuit seems likely with both. With the help of an attorney, about how long do these types of cases usually take to get resolved? I ask this because I need pre-approval for a condo I want to purchase, and a year in court would ruin my plans.

2) If I tried to settle with them (for around 30 to 40%), and got EVERYTHING in writing - debt is fully satisfied, mark appropriately on my reports, etc. - how successfull has this been for your other clients? What has been the average settlement amounts and terms you've negotiated with these companies?

3) If you believe there is a better way to handle things - other than what I've outlined above - please let me know.

Again, thank you in advance for your insight.

Link to comment
Share on other sites

hey, i know you have heard from me before, but i still want to offer as much help as i can. any lawsuit posted would not affect your credit until you lost, IF you lost that is. So, you could drag this thing out with lost of motions and such until you get your condo. And, as a banker myself who bought a house when Credigy was jacking with my credit, I can tell you that MOST mortgage brokers dont' look at charge-offs older than 2 years. And, Credigy is considered a collection agency as is Assett. Just explain to your broker that they are duplicates of the OC, and it was charged off so many years ago. If your income and score are above minimums, then you should be ok. :D

Link to comment
Share on other sites

I really do appreciate your input.

I'm working with a pretty good mortgage broker. My score is just below the minimum to be approved with far less hassle (and an outrageous interest rate) than it is now. Because Asses and Cred-dirt-gy are after me for over $10,000 ($5,000 X 2), this exceeds the "forgiven" indebtedness that some lenders would ignore. One lender would ignore only up to $3,500 worth of debt that's 2 years old or older.

I've got a few old medical bills that I will be PFD'ing for April, and I've already sent in a round of disputes on 3/14/06, so I hope that helps as well. (Waiting for results.)

The thing is, I found the perfect place - all I have to do is provide downpayment and a pre-approval letter to hold it. I could then wait for 4 to 5 months to close - because it's unfinished. By then, I should be well past this mess.

Link to comment
Share on other sites

I do have one strategy that *might* work, and help to accellerate the process. Let me know what you think:

The dunning letter I received was pretty generic and ambiguous. It had the usual verbiage and mini-maranda, and i DV's them two weeks after receiving it. The thing is, I believe it was from Credigy but the letter represented themselves as representatives of Discover. Discover sold the debt, balance is zero $0 on my report.

I've DV'ed this attorney twice, and sent follow-ups to all three CRA's. Depending upon my results, I will use the fact that this generic dunning letter never disclosed which CA they represented, and refused registered letters requesting the info. I asked the CRA's for the info in my last dispute (I know they won't give it to me), so that I could take up the issue with the creditor".

I expect to receive nothing.

I will use this as grounds to have EVERYTHING removed, and cite those portions of the Fair Debt Collection Practices Act that apply along with my "proof" in my next round of disputes. I can only hope that this might put a complete stop to all of this.

If it forces the CA's the sue me, all the better.

Link to comment
Share on other sites

About your lender: Mine was for 12K for Credigy, but the actual amount is only 6K. They looked at that, not the collection amount. See if the "High Balance" amount is closer to the orignal. Credigy STILL has that listed, and that is what I told my lender (who was the builder too). Lennar was my builder, and their mortgage company worked quickly and got the dup for discover completely removed and only "saw" the original amount.

Your tactic: that might work! They are supposed to disclose who they actually represent. Usually, the dunning letter comes straight from Stewart & Asses, and they hire a local a$$ to file litigation. In Texas, it was the infamous Kyle Doviken (twerp). And, since you KNOW that they actually represent Credigy, NOT Discover, they made a misrepresentation. Check out Devil21's fed lawsuit site. He has something on there about factoring companies and who they are not allowed to report themselves as factoring companies since they are not innocent purchasers. Good reading.

Ok, as always, good luck, and let me know if i can help.

Link to comment
Share on other sites

Your tactic: that might work! They are supposed to disclose who they actually represent.

Really? VERY cool. I need to find the part of the FDCPA that specifies this and quote it in my next dispute to the CRA's. Although I won't dispute with the CRA's for another 3 weeks or so, I've already started constructing the letter. I want the wording and portions of the law stated as precisely as possible.

I will be studying the law as closely as a layperson can before submitting my dispute letter. I will review with my attorney before doing so as well. Their interest is solely to build a case against the CA's so that they can receive compensation when they sue (and win)... representing me has been free (so far).

Wouldn't it be funny is a danmed dunning letter actually saves my butt? :D

Link to comment
Share on other sites

Wouldn't it be funny is a danmed dunning letter actually saves my butt? :D

:ROFLMAO2: Yes, very! Was it from Stewart and Asses? Cuz it seems like they are pretty on top of the dunning letters lately, b/c of all of the lawsuits filed against them. You may want to try class action also. What state are you in again?

Southland recommends this:

Jones-McClure Publishing is in Houston & they publish retired justice Michol O'Connor's series of law books including "O'Connor's Texas Rules Civil Trials" and others (forms book, etc.,) that are INDISPENSIBLE to pro se's in Texas.

Every time I have attended a deposition (around 400 hours at last count) and in every hearing at which I was present, at least 1 lawyer in the court room also had 1 or more copies of her books. You can buy them directly from Jones-McClure or at a Law School Book Store. I even picked up a copy of the 2005 Texas Rules Civil Trials at a Half Price Book Store this weekend in the DFW area.

Link to comment
Share on other sites

About your lender: Mine was for 12K for Credigy, but the actual amount is only 6K.

The original debt was for $2,000 and $2,500 - but it's been inflated to $4,300 (asses) and $5,000 (Cred-dirt-gy).

They looked at that, not the collection amount.

There's nothing to compare the debt to in my case, 'cause Dicover say's zero - if i am understanding you correctly. You said $6,000 is what your lender / builder payed attention to. I don't have that to rely on.

Lennar was my builder, and their mortgage company worked quickly and got the dup for discover completely removed and only "saw" the original amount.

If I can get my dup deleted, then the original amount will be Zero. :twisted:

Link to comment
Share on other sites

My dunning letter was from right here in Michigan - a Detroit suburb. Their street address is about a 20 minute drive from where I live.

The attoney that runs the consumer law agency I'm working with apparently knew exactly who he was, but didn't go into detail. I assume he has litigated against him before.

I'm working two jobs right now - a midnight position at one of the Big 3 auto manufacturers and a side business. I'm making enough money to pay an attorney (and pay my bills for that matter) but I have little time to learn how to represent myself in court. Matter of fact, I read these boards when I'm at work mainly.

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

×
×
  • Create New...