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Questions about debt settlement


erin26
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I have some questions about debt settlement:

If I settle a debt at less can the Original Creditor sell the forgiven amount to debt buyer?

If I settle a debt with CA, can they sell the forgiven debt too?

Can I stop this action by filling out 1099C?

What if I don’t pay it second round?

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If I settle a debt at less can the Original Creditor sell the forgiven amount to debt buyer?

Yep...whatever you do, get it in writing. If it isn't in writing, it didn't happen. Make sure the terms are well defined...

If I settle a debt with CA, can they sell the forgiven debt too?

Yep...again, get all terms in writing. Make sure to spell out what happens to the balance.

Can I stop this action by filling out 1099C?

Maybe not. First, you don't fill out the 1099c...the people you owe the money do. Second, its unclear whether the 1099c protects you from having the debt resold. To my knowledge, there are no court decisions regarding this. However, IMHO, it might work. Realize that you'll have to pay taxes on the amount forgiven...

What if I don’t pay it second round?

Start at the beginning...

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