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There is just so much information that I'm trying to absorb that I'm getting confused. Please don't think that I'm just posting without putting my time in to read, but all the information is just so overwhelming especially since I have been reading it for the past 6 hours. I'm a college student who is just tired of turning the other eye and would like to take steps to actively improve my situation. :-/

Here is my situation.

I have recently received two letters from Northland Group for two outstanding accounts:

1. Capital One - 1688 balance with settlement offer of 776.82

2. Arrow Financial - 1319.27 with settlement offer of 1068.61

I am in California with a SOL of 4 years so these accounts wouldn't be out of the SOL until mid june of 2006.

Should I just sweat it out until the SOL is up next year? If I do, does that do anything for me? Northland doesn't show up on my credit report, but all my accounts already show up as "C/O as bad debt". Is it too late to go to the OC and try to negotiate with them as opposed to this CA? Any tips to boost my credit score would be appreciated. I have not done anything or responded at all.

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Since Cap1 is one of the most difficult to dispute I would accept their 40% offer which is quite standard with a 3rd party.

The arrow however I would dispute. I would dv both Arrow and the CRAs because I guarantee they re-aged your account by placing the DOLA or date opened as the day Arrow purchased the account. It appears to me that Northland is collecting for Arrow.

I wouldn't pay them a dime I would rather sue their asses....since it is so so so easy to do with them.

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Thanks for the quick reply,

1. If I do accept the settlment offer from Northland for the Capital 1 account, will that help my credit score any? I would just like to make sure my $776.82 does something towards my future.

2. Is there anything I can do to pick my score up?

Thanks for all the help. This site is so much more helpful than the Suze Orman's credit guide that I paid 50 bucks for!

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I think you first need to take a breath and make sure you know what your ultumate goal is...

To answer your specific question, no, paying off a bad debt usually has little or no impact on your credit score. You may, however, be ablt to negotiat a "pay for delete" which would help your credit score quite a bit.

However, I think you need to ask youself why you want a "good" credit score - what do you think that will accomplish for you?

Althought I usually say it tongue firmly in cheek that all a "good" credit score will get you is the ability to go quickly, easily and deeply into debt, I am very serious when I say that. A score is nothing more than a measurement of debt...a billionare can (and probably will) have a VERY poor FICO score because they aren't in debt.

Short of buying a home, there is nothing else you should go into debt for and a REAL mortgage lender that does real underwriting will qualify you for a lone based on YOU and not just a stupid score...in that case, a paid off bad debt DOES help because it shows the underwriter that while you once had aproblem; you've corrected it...two to three years of being early or on time with your rent and utilities, not having debt, having a decent income and a decent down paymetn WILL qualify you for a traditional loan at the best rates even if you have a low FICO score.

I am a strong proponent of staying on top of your credit bureau reports to keep then accurate but you shouldn't be afraid of negative history so long as it's accurate and so long as it's history and not how you currently live your life.

Debt is the most heavily marketed PRODUCT in our economy today...that's why they send out BILLIONS of CC offers every year...DON'T FALL FOR THE MYTH THAT YOU NEED TO BE IN DEBT or that you CAN"T LIVE WITHOUT A CREDIT CARD...IT'S A LIE.

Don't worship at the alter of the perfect FICO score.

And if it takes you a little while to absorb all this sutff, you don't need to apologize for that...everybody starts at the beginning.

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I'll fall somewhere in the middle on this one.

I agree you should take the offer on the Cap 1 account. Get Northland to say in writing that this settles the entire amount. Put "accord and satisfaction of acct xxxxxxxxxxxxx on the memo part of your check. Do itnow, while the offer is still open. Better to show you owned up to it.

I'd DV the Arrow account, but be ready to settle if you can.

The damage to your FICO scores have been done. Time will heal the C/O wounds. You are too young to worry about it. Forget Suze Orman. If you want a guru that can help you going forward, check out the books by Mary Hunt at http://www.debtproofliving.com/. She makes great great sense.

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I apologize for not getting more in depth with my reasoning for certain things...My brain races in 25th gear when my fingers can only move at a snails pace if that.

Cap1 is a no-win situation when trying to negotiate anything at all in regards to placing remarks after settled or even paying the full balance. They are very clever and uncooperative.

I had an attorney recently contact me for help with a cap1 account and he sent me about 1000 words on how he tried every single possible way to get around them each time unsuccessfully.

I am a firm believer in trying to pay off or settle anything that will not go away and for those that can potentially be removed I will DV ITS CD you name it until I have exhausted every option possible and by then the CA is exhausted in fighting and just throws in the towel and offers some ridiculous amount to make me go away.

Call me stupid but I would rather spend more money on CMRRR and time then giving CA's a penny of money that is not even mine.

Pay Northland and dispute arrow. Those guys will trip over themselves every single time.

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wow, thank you all for your plethora of knowledge. i wish i had just been responsible in the beginning. so many of these cards were $300 limit cards that suddenly ballooned into $1400 because of fees. I would like to look at buying a home eventually and don't want this to ruin my goals. I'm trying to pick up the lingo as quickly as possible, but am still confused about things such references as "DV ITS CD" and "CMRRR". Thanks so much for offering some hope at a more resolute ending.

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I am curious to know what you do with Crap 1, however Arrow DV has been successful for me, although I just noticed an inquiry on a CRA, meaning arrow probably just sent it somewhere else. I sent DV to Arrow both addresses listed in my Reports, they recieved 10/3 & 10/4, I recieved letter dated Oct 6 stating delete from Trade Line. Now it is wait and see, keep your fingers crossed....

Good luck, hope this helps!

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Do these CAs own the debt or are they collecting for the OCs?? I like to get all settlement terms in writing, in the form of an agreement, before I send any monies. If the CA is collecting for the OC, then remember that your agreement should be with the OC.

Here's a settlement agreement I have had good luck with - you will have to amend it to address your particular settlement terms:

This Agreement is entered into on the date below between XXXXX, Creditor, and (your name), Debtor.

Whereas, Creditor has alleged that Debtor owes him $XXXXX, for (Acct # or Case #);

Whereas, Creditor and Debtor desire to settle this matter and put at end to all collection efforts in pursuit of this alleged debt;

Therefore, in consideration of the undertakings set forth below, Creditor and Debtor hereby agree as follows:

Debtor will, at the time of executing this Agreement, pay to Creditor the sum of $XXXXX (settlement amount) as full settlement of any claim of Creditor against Debtor. (If you are doing a payment plan, lay out the terms of the plan here.)

Creditor agrees not to make any future claim or bring any future action against Debtor in pursuit of this alleged debt.

Debtor & Creditor hereby release each other from all claims each has against the other arising from this matter.

Within thirty (30) days of receiving this settlement (or final payment, if you are doing a payment plan), Creditor agrees to remove all negative information related to this debt from the files maintained by the major credit reporting agencies and report the account Paid As Agreed. (You probably won’t get this but it doesn’t hurt to try.)

This Agreement embodies the entire understanding between Creditor and Debtor relating to the subject matter of this Agreement and merges all prior discussions between them.

A facsimile or copy of this settlement/agreement may be treated as the original.

This is a legally binding contract. Both parties have entered into this agreement voluntarily and will be bound by it.

The person signing this for Creditor represents he is authorized to bind Creditor to this agreement, and Debtor relies on this representation.

This Agreement may be signed in counterparts. (This means the Creditor and Debtor may each sign separately and it is still binding – you are most likely faxing this thing back and forth, remember)

Insert a signature block here - include signatures lines, lines for printed names and dates for both Creditor and Debtor.

If this matter ever should come up again, you have this agreement. This should be the end but I am not a particularly trusting individual, either. However, if some sleazy CA were to come after you, you can tell them to go ahead and sue you, you have a release from the OC, or you could sue them for attempting to collect.

The attorneys may jump in here with suggestions on wording. This agreement has worked for me in the past but that doesn't mean it can't be improved upon.

Good luck!

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