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Collections Agreement Question


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Hi there...


I have a question regarding a Citi credit card debt that I am considering paying off through a collection

agency (Global Credit Collections in Florida) but before I do I needed some advise. The debt of course

was originally much less but 2 years later at 22% interest  has gone from about $9,000 to $17,000. My

credit is still pretty good considering but it is the only thing holding me back to doing some real estate

investing (I have 20 years in real estate and feel I can successfully do some flipping). So my question 

is I have reached an agreement number of $4000.00 with the CA but they are telling they cannot remove

the debt from my credit, only CITI can do so. Is that true? Secondly, how do I learn if they are indeed the

firm responsible for collecting the debt and that I can trust them to ensure the debt is recorded as paid

and not be scammed? If it does not really raise my credit score by paying it off with a derogatory status

then I am not sure I should go through with the verbal agreement....


I would be very thankful for any advise!


Thank you!

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It does not raise your credit score...at least not immediately.


Ideally, the Citi TL would be marked "settled for less"...the CA would probably used "paid as agree".  Both are derogatory.


IMO, never negoiate with a CA...you cannot trust them.  Their business model is based on lies and half truths.


If you want to settle this, I would call Citi...ask if they still own the debt...if yes, Iwould tell them to deal with me directly or take me to court...follow it up with the $4k offer in writing "this is what your CA offered", sent CMRRR (so you'll have proof in court that you offered).


If Citi doesn't own it...tell the CA to prove they do or get off your reports.

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I (me personally) would only deal with "the party that has all the power".  The are making it clear that it is the OC.  This is generally the case.  So I would only deal with the OC.  If when I call the OC they tell me to call the CA, I will tell them "I already did ... so I will make them send the account back to you" (and then send a C&D to the CA).

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I did contact CITI Card yesterday and they did validate that Global is the company they use to collect

and to contact them. I am told by the CA to make any payment to CITI so that gives me a little peace

that any payment goes to CITI. Do you believe if I push the issue with CITI they will deal with me and

what do you think the odds are I can get them to remove it off my credit rather than show a derogatory



Thanks so much!!

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Its unlikely Citi will delete their TL. 


Unless you get something in writing BEFORE YOU SEND MONEY from either Citi or the CA, its possible Citi will accept your payment and just apply it to the balance rather than marking it "settled for less".


It would be best to get a written agreement from Citi...but, if you do get it from the CA, you can probably use it in court if you have to defend a suit by Citi later on.


Its true...not every "pay for less" arrangement turns out bad.  Most just continue to ding your credit.  But, a significant number come back to haunt.

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The debt of course was originally much less but 2 years later at 22% interest  has gone from about $9,000 to $17,000.


Go see a lawyer . . . you're about to be taken to the cleaners.


You want to calculate the interest on $9000 at 22% interest per year after 2 year(s).

The formula we'll use for this is the simple interest formula, or:


•P is the principal amount, $9000.00.

•r is the interest rate, 22% per year, or in decimal form, 22/100=0.22.

•t is the time involved, 2....year(s) time periods.

• So, t is 2....year time periods.

To find the simple interest, we multiply 9000 × 0.22 × 2 to get that:


The interest is: $3960.00

Usually now, the interest is added onto the principal to figure some new amount after 2 year(s),

or 9000.00 + 3960.00 = 12960.00. For example:

• If you borrowed the $9000.00, you would now owe $12960.00

• If you loaned someone $9000.00, you would now be due $12960.00

• If owned something, like a $9000.00 bond, it would be worth $12960.00 now.




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