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Settling with JDB


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 I need to get a student government loan and there’s 1 TL standing in the way. The last activity on this account was 4 yrs ago. Although I have gotten other loans before, the government loan requires me to either have this TL settled or having been paid for 6 months.

 

So the OC has sold the account to a JDB. I have mailed a letter to OC on settling with them asking them to report as paid in full. When I spoke to OC over phone I mentioned either reporting as paid in full or completely removing the TL but they referred me to JDB. I don't want to re-age it and drop my score by settling and it reporting as settled less than full balance.

 

Is it possible for me to settle with JDB and have them tell OC to completely remove the TL or have it reporting as paid in full since the new agreement will be paid in full? How do I go about it?

 

 

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If the OC sold it to JDB, their TL should list a balance of zero (or be gone).  What does the OC TL have?

 

Normally we do not recommend paying a JDB unless there is something essential about it.  You may be in that case seeking a government backed student loan.  If you make a payment plan and start paying, your will definitely reset it to zero years, and the TL will reflect you owing (and presumably paying) on the payment plan you agreed to.

 

If you get the loan settled (paid in part) and reported as settled (paid not in full), is that enough for you to get the government backed student loan?  Or are they expecting you to have it paid in full.

 

The JDB does not have any authority to tell the OC what to do.  At best they can make such a suggestion.  In practice, a JDB care only about getting as much money as they can, and will do whatever it takes to maximize what they can get from you.  They will negotiate in bad faith right from the beginning.  Once they know you have a goal that requires a debt they hold to be paid, they will try to get as much of it as they can.  So do not give them any hint why you are considering paying this.

 

I would start by just disputing it with the CRA as "not mine" and see if they simply fail to validate it back to the CRA.  You might get lucky.

 

If you tell us the name of the JDB, OC, and the approximate amount (pick a nearby number within 15% of the amount), we might be able to give you more information about your chance of success in various efforts.  Also, the name of the specific CRA if only one or two are involved could help.

 

The alternative is to just buckle down, get two jobs, and earn enough to start school at some balance between amount you can work and amount you can pay for with what job you keep.  Your debt is, or is just about, past SOL in Texas, so you may not have to deal with a legal case by putting this off.

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The way I read his post, he's trying to get a government backed student loan, but has negative TL on his CR ... which he did not describe what it was (whether another loan, or a CC, or something else) other than sold by OC to JDB.  He did mention he had other loans, but no indication the other loans were student loans or car loans or whatever.  He didn't connect the negative TL to any of those loans.

 

But I agree.  If he has a past student loan debt, they can generally force payment in full on those.

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First I want to thank you all for responding, I really appreciate it. The OC is Harley Davidson and I found out today that this account is still with them but they have Professional Recovery Services servicing this account. The balance is around 10K and its reporting with all 3 CRAs. I don't have any other student loans.

 

In answer to your question settle less full balance would suffice for the student loan I am trying to get. However I am trying to avoid this because I don’t want to re age.

 

So since the new information if I call and speak with Professional Recovery Services would they have more leverage to get Harley to completely remove TL or report it as settled paid in full ( I understand that this could be accurate based on a new agreement being paid in full).

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I already started school and they are waiting on me to get this resolved. While they may not kick me out they could if I tell them wait until December. My understanding is that there is no way the collection company could file suit and get a judgment within 1 month because I could stall in the appearance etc.

 

So trying to decide if I should press the issue now or wait. 

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What is your financial status with regard to paying the classes you are now attending?  Have you paid the school up front?  Or did they let you attend pending the government loan?  Do you have (or can gather) the means to pay the school for THIS one term?

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I agree with @TomnTex and would definitely wait it out this close to the SOL. It would be rare for an OC to do a pay for delete anyway. The CA has absolutely zero power to do a pay for delete. If they say they can make sure and get them to give you the winning Powerball numbers for this week. 

 

My question is how much are you willing to pay on the debt vs the amount of the student loan. I would take any money you planned on paying the CA/OC and pay that amount to the school. You will at least get something for your money that way. 

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@ArtVandelay - you can do a pay for delete with CAs.  Maybe not on student loans, though.  

 

I think his concern is with the OC since they still own the account. I just didn't want him paying money to the CA expecting to get the TL from the OC deleted. I have read way too many horror stories of people doing this and realizing they just wasted their money. 

 

If I were in the same situation I would take the money and pay the school instead of paying the CA. Why pay 5K-10K on a loan that is so close to the SOL just so you can turn around and get another loan? 

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About 20% of my semester has been covered by a different government student loan, the other 17K still needs to be funded. Yes that is 17K for the semester because this is a graduate program. The balance on the account is 10K and I would not pay more than a few grand in settlement so applying that to the loan won’t really help anything. The key would be to negotiate a settlement with the result being one of the two below in order of preference.

 

 

1. Negotiated settlement for 10-20% of the balance because the SOL is expired or about to. Terms of settlement being full trade deletion. Even if it reports settled with less than full balance I would still be approved with the student loan. I'm just trying avoiding re aging and remove the derogatory account completely.

 

2. Negotiated settlement for 10% of the balance due to SOL expiration. TL reports paid settled for less than full balance.

 

Are you guys saying that if I wait till SOL expiries that I can have it removed without having negotiating a settlement? It is my understanding that they cannot force me to pay past 4 years but can report it up to 7yrs.

 

According to admin I can negotiate a deletion with the CA is this true or not?

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You are definitely in a touch situation! I had no idea you were talking about 17K per semester!

 

You might be able to negotiate to get the CA TL deleted, but the OC TL will stay. If someone knows a way around this one I would love to hear how to do it.

 

Its really hard to say because waiting out the SOL is what many of us are looking to do. It is true if you pay them and don't have everything lined up properly that it may reset the SOL. If you do negotiate make sure and get everything in writing and have a legal professional look it over.

 

I would also make sure and get everything in writing from the loan officer you are dealing with. You definitely do not want to go through all of this only to still get denied on you student loan. 

 

More than likely the TL from the OC will stay on your CR for at least 7 years. It can stay on some reports for up to 9 years like the ones that  potential employers use. You can always try and dispute it and "hope" they ignore it. 

 

Sorry I don't have a better answer, but I don't see any easy way to do this without risk. Maybe someone with more negotiating experience can help.

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1- The CA is not reporting it at all this is only about how the OC is reporting the TL.

 

2- I guess I have no issue with the TL being there for 3 more years. Due to its age it has had minimal impact on my ability to get credit except for this perticular loan and even on this loan I just have to show that it has been settled.

 

My #1 concern is that when I settle it the account gets re aged and it now looks like a C/O that took place in 2013 instead of 2009. Is there any way that I could as a secondary option request that the CA and or OC somehow not re age it. In other words they call it zero balance and settled less than full balance but not reflect as some recent payment been made which could drop my credit, 

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You can make the deal, but it is impossible for anyone here to tell you if it will work out the way you hope. Paying one company in exchange for stipulations from another company is just a difficult call. I'm not sure anyone here has had an dealing with the combination of HD & PRS. I'm not saying its impossible, but we have heard more problems than solutions from doing this. 

 

The only thing you have going for you is the SOL expiring. I would wait until you are sure this has passed and then try and deal with HD directly. The charge off is not an issue at this point. That can only be reported one time. What will happen is that the account will be sent back to HD. They will either let it die, give it to another CA or sell it to a JDB. They can try and collect from you in the future, but legal action will not be an option after the SOL is over. 

 

It sounds like you are going to have to this and take the risk.  Remember if HD sells this account it will be worth about 100. - 200. at the most. Start from there and work your way up. Unless they file suit in the next few days they know its worthless.

 

I can't stress to you how much to get everything in writing and have an attorney review it before you do anything. 

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The OC is the same school you are attending now, or a different one?

 

If it is the same, then you owe money to the school that is allowing you to still attend classes ... but is acting in a way that makes it hard (or impossible) for you to get them paid (especially if they won't take the money and work with you to be sure they are paid).  You need to set up a meeting with a TOP LEVEL financial official at the school and have that important conversation about why the school is operating in a self-defeating manner.  Take a copy of this post with you.  They need to learn that the whole debit/credit system in this country is so goofed up that "operating procedures" are never adequate for dealing with it, and depending on them for credit matters is contrary to the educational process.  Of course schools need to shut out people that won't pay their bills (so it is reasonable for them to check ... but they need to understand that checking alone is not enough).  Your case is clearly one of "procedures gone awry" (e.g. someone with decision making authority needs to override the procedure book).

 

If the school refuses to cooperate, and refuses to work with you, then at some point you should consider taking it public (including revealing their name).

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One more very important thing I forgot to mention.

 

Do Not give them your bank account information under any circumstances. Lots of horror stories out there of people getting their bank accounts drained by collection agencies. Some of these CAs have independent contractors working from home and I'm not sure about their background procedures.  If you pay do so by certified check and only send it CMRR after your attorney has cleared the contract.

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