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How true is it ?


DebtAlarm
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Got a letter from Jefferson Capital System Collection Agency for my long unpaid balance with CapOne. Along with that letter is a Pre-Approved CC Appication, which states that They will issue a credit card and transfer all my balance to that card. 0% apr life time for the loan. After paying off it will show paid in full on my credit. Credit Cart Company is Majestic. It states in fine prints that Jafferson is not Affiliated with Magestic so they play no part in decision of Majestic to give me credit. Now how is that gonna work out? Did anyone go throuht this? Any input is appreciated...Thanks

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This has been around for a couple of years now. As I see it, it is someone's idea of trying to collect a bad debt by offering something that would cause someone to jump at the chance to correct a "mistake".

Remember, the one who sent the letter now owns the debt. Therefore, all negative info reported by the original will remain on your CR for the time allowed by law, with the only exception being that it will show a zero balance and a notation of "sold or transferred". This means that all of the lates will show. As to the current holder of the account, they will report a postive TL with the amount owed properly reported. As you make the payments, the balance will decrease, eventually, and it will show a positive TL. At such time as account is paid in full with no problems, many times they will continue the account with that balance being your limit, or around that amount.

Is it worth it? Well, it is entirely up to you and how you want to clear up your CR. Now, if the debt is timebarred, SOL has lapsed, and the TL will be deleted within say a year, forget it, as by your accepting the terms, you are also resetting the SOL. This means that if you fail, they will have all new timeframes to come after you. But, if it is only delinguent for two years, then it could possibly help you. Again, it is up to you. Sit down and look at the whole picture before deciding.

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I think retmar is really right...

If you don't got that much time to go, then let it be water under the bridge...

Also, with such cards, you are looking at terrible rates, awful fees, and stupid credit card tricks which can easily set you back more money than what it is worth... Or perhaps even make it worse...

When the time comes, go for real credit cards instead of these kinds of predators...

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If I understand the facts correctly, you would in effect be stipulating that the the debt and the amount owed is your obligation and the only thing they are offering you in return is an opportunity to maybe get the 'olc' debt approved as a "new" loan.

Assuming you believe this CA (usually not a good idea), even if they do "rehabilitate" the debt into a "new" loan it doesn't erase the history that you had a bad debt in the first place...that's the good news...what if they don't 'rehabilitate" the debt??? In that case you've accepted total responsibility for the debt and gotten nothing in return.

As a financial planner friend of mine likes to say...you can't play with snakes and not expect to get bit...and...you can't borrow your way out of debt.

I say, pay the old debt when you can (if it's your debt) and go through the DV process...you can probably get started on the road of cleaning up your bureau at the same time. In the end, I think that's the better way to go.

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THis is a scam that cap1 has been running for years. They take a debt that is out of SOL and talk you into taking a new loan (the CC) to pay off the old out of SOL one. Then if you default, they can sue and expect a win. This is a backdoor way to reage.

There is a poster on CB (smush24), that did this through NCO. Cap1 removed their old derog TL and added a new pos TL. If you can get assurances that the old derog will be replaced with a new positive AND you have the money to pay down this debt (and the amounts are correct), it would not be entirely out of the question to consider this.

OTOH, Maryland SOLC is three years.

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