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Shiva

CitiBank Charge Off

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Hello Everyone,

This is my first post. Please let me know if I am not following the forum codes.

Citibank is my first credit card in United States. I got that in 2016. I was a college student by then. I didn't use it well and missed the payments. Now it is in Charge off.

When I called Citibank about it. They told me its charged off. If I want I can send the payment to the address. (I feel like they are least concerned about it) They are not providing me a email address for me to communicate with them for Pay for delete.

Since the amount is only $1800. I am planning to pay them off in full.

But as expected my credit score is in 600. I wanted to improve it. What can I do now?

 

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They will almost certainly not do a pay for delete.  

Your choices are to pay it off in full, or try to negotiate a payment.  

Realize if you don’t pay it in full you will almost certainly never get another Citi card.  A lot of places use Citi cards. 

If you do pay in full, maybe you can and maybe you can’t. 

As for your credit score — it will get better with time.  Manage your debt and your finances first.  Your credit score will eventually improve. 

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11 hours ago, Shiva said:

Hello Everyone,

This is my first post. Please let me know if I am not following the forum codes.

Citibank is my first credit card in United States. I got that in 2016. I was a college student by then. I didn't use it well and missed the payments. Now it is in Charge off.

When I called Citibank about it. They told me its charged off. If I want I can send the payment to the address. (I feel like they are least concerned about it) They are not providing me a email address for me to communicate with them for Pay for delete.

Since the amount is only $1800. I am planning to pay them off in full.

But as expected my credit score is in 600. I wanted to improve it. What can I do now?

 

600 is not bad for having a fresh charge off with a balance owed on it.

They will not remove the account from your credit reports.  Once you pay it off, the $0 balance reported with increase your score.  Other than that, just time will help.  The further you move away from the charge off date, the more your score will slowly creep up.

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Thank you!

I will pay off the debt first!!

That will help.

Thanks again for the responses!!

 

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I'd wait for the account to be sent off to a collection company or JDB and negotiate with them a PFD unless you are in an urgency to get a 10-20 pts increase. 

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2 hours ago, Boisvert said:

I'd wait for the account to be sent off to a collection company or JDB and negotiate with them a PFD 

No one does PFD anymore. You can probably negotiate a lesser amount with a JDB, but by that point you'll have two derogatory accounts on your credit report (Citi and whoever they sell to). Best to pay Citi directly now (or work out a payment plan) and avoid the account being sold or going to a debt collector. 

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9 minutes ago, Harry Seaward said:

No one does PFD anymore. You can probably negotiate a lesser amount with a JDB, but by that point you'll have two derogatory accounts on your credit report (Citi and whoever they sell to). Best to pay Citi directly now (or work out a payment plan) and avoid the account being sold or going to a debt collector. 

Citi removed my tradeline when it was sold to a JDB. I have also had great success with PFD with collection agencies. 

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8 minutes ago, Boisvert said:

I have also had great success with PFD with collection agencies

Then you can console the OP when her credit scores drop another 50 points and Midland won't budge. 

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14 minutes ago, Harry Seaward said:

Then you can console the OP when her credit scores drop another 50 points and Midland won't budge. 

My score didn't go up 130+ pts to 746 by having a binary mindset. There's not just a two possible outcomes for every situation. 

If the OP can get financed/approved for an urgent need with their score going from 600 to 610-630 then go for it. Otherwise the OP is wasting $1800 for no good reason. The best approach would be to ignore this and let time heal the wound especially when the OP's credit is already 600 and a debt from 2016 which day by day gets closer to the SOL expiring. 

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1 hour ago, Boisvert said:

My score didn't go up 130+ pts to 746 by having a binary mindset. There's not just a two possible outcomes for every situation. 

If the OP can get financed/approved for an urgent need with their score going from 600 to 610-630 then go for it. Otherwise the OP is wasting $1800 for no good reason. The best approach would be to ignore this and let time heal the wound especially when the OP's credit is already 600 and a debt from 2016 which day by day gets closer to the SOL expiring. 

What worked for you one time won’t necessarily work for everyone else. 

Citibank often sues.  

I was sued twice by Citibank, and both times the OC sued me.  No JDB. 

My wife had a Vz account with a JDB. They did not have enough proof to sue successfully, so they never sued.  She offered full payment for a PFD.  They didn’t even reply.  She never paid a penny, but she had to wait for it to eventually fall off her CRAs. 

The advice you are giving the OP is very dangerous.  You say it worked for you once in one particular situation.  In other situations it could blow up in the OP’s face.  

 

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2 hours ago, Boisvert said:

There's not just a two possible outcomes for every situation.

Essentially there are. There is the 'by far' most likely outcome and then everything else. Also, I have a problem when people say such general things like "I have also had great success with PFD with collection agencies" when absolutely no explanation has been provided, and knowing this claimed experience is far from average. It's not a credible claim, in other words. 

2 hours ago, Boisvert said:

Otherwise the OP is wasting $1800 for no good reason.

Other than the fact that she apparently legitimately owes Citi $1,800, you mean? Also, it prevents a possible judgment, and as i said before, a second collection account on her credit reports.

I also think your "10-20 points" is very likely a gross underestimation. 30% of your FICO score is based on credit utilization. A charged-off account has a limit of $0, so if she has no, or very few, other open accounts, her utilization is though the roof.  30% of 600 is 180. Of course she's not going to get 180 points out of this, especially if there are credit accounts being factored in and the fact that this account is a charge-off after all, but i would be surprised if the boost ended up to be less than 40-50 points in 6-12 months time. 

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On 5/31/2019 at 5:51 PM, Harry Seaward said:

Essentially there are. There is the 'by far' most likely outcome and then everything else. Also, I have a problem when people say such general things like "I have also had great success with PFD with collection agencies" when absolutely no explanation has been provided, and knowing this claimed experience is far from average. It's not a credible claim, in other words. 

There are not. Also, your "No one does PFD anymore" is exactly the same type of statement you are ranting about. This type of statement is the worst possible thing you can tell someone that's attempting to fix their credit. Credit is the epitome of YMMV. A better response is "PFD success rate has decreased to nearly zero, especially when dealing with an OC but you don't loose anything giving it a try", versus pushing the OP to completely even consider the PFD approach. So the credibility would be much higher with someone that has dealt with it and has had very good success with PFD with both CC collections and medical collections. 

 

On 5/31/2019 at 5:51 PM, Harry Seaward said:

Other than the fact that she apparently legitimately owes Citi $1,800, you mean? Also, it prevents a possible judgment, and as i said before, a second collection account on her credit reports.

Not only does the OP owe but also has the willingness and financial ability of PIF which gives the OP all the leverage. There is too much fear induced in a response like this. Do you know how many collections actually end up in litigation? and out of those how many end up in judgements? A very very small amount. If this account goes into collection the OP has a much better/higher chance of getting this removed when dealing directly with a  collection company or JDB. There's also a 0% change this ends up in a judgement when the OP is engaged and willing and able to pay for this amount in full and a very high possibility that she can get a collection removed versus an OC tradeline.

CITI is notorious for deleting the tradeline when they are sold to an CO/JDB. 

 

On 5/31/2019 at 5:51 PM, Harry Seaward said:

I also think your "10-20 points" is very likely a gross underestimation. 30% of your FICO score is based on credit utilization. A charged-off account has a limit of $0, so if she has no, or very few, other open accounts, her utilization is though the roof.  30% of 600 is 180. Of course she's not going to get 180 points out of this, especially if there are credit accounts being factored in and the fact that this account is a charge-off after all, but i would be surprised if the boost ended up to be less than 40-50 points in 6-12 months time. 

 

Again, you are incorrect. A charge-off still reports the original credit limit. You are incorrectly stating this and you are confusing this with a collection tradeline. A collection would have a balance with no credit-lime and a JDB listing might have a balance with a $0 credit limit but the OC listing will have a credit limit in the report. 

On 5/31/2019 at 5:51 PM, Harry Seaward said:

30% of 600 is 180. Of course she's not going to get 180 points out of this, especially if there are credit accounts beingfactored in and the fact that this account is a charge-off after all, but i would be surprised if the boost ended up to be less than 40-50 points in 6-12 months time. 

 

Also incorrect! That's not how credit scoring works. Is not that 30% of your current score is based on your utilization, is that 30% of your total possible score (850 for FICO) is based on utilization. Those are two very different things. 

A typical increase would be around 40-50 if this is the only thing affecting the OPs score. If they utilization is 0%, no other late payments, good mix of credit, good length of credit etc. But if there are other collections, charge off, late payments or other balances on the credit profile this will not have the impact the OP is anticipating. 

 

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28 minutes ago, Boisvert said:

Also incorrect!

Ok. Like i said before, I'll refer the OP to you when all of your predictions fall flat on their face. 

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1 hour ago, Harry Seaward said:

Ok. Like i said before, I'll refer the OP to you when all of your predictions fall flat on their face. 

The only prediction so far that has fallen flat on its face so far is you predicting that MOV letters won't do anything and best thing I did was not listen to that advice. Chargeoff was removed from all 3 CRAs after sending MOV letters. 

 

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3 hours ago, Boisvert said:

Chargeoff was removed from all 3 CRAs after sending MOV letters. 

The part you left out here is that you sent arbitration demand letters to the JDB before you sent the MOV letters to the CRAs, and then the "trade-in" (I think you mean "tradeline") was removed from your reports.  Well known fact around here is that JDBs remove tradelines from credit reports in anticipation of, and during, litigation from either side.  Since arbitration is a form of pseudo-litigation, it should come as no surprise that the JDB yanked your tradeline as soon as they got the notice that you were threatening action against them.  In other words, I know you think you're special but it wasn't the MOV letters that caused the deletion, and instead was your threat of legal action which they do for everybody.

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On 5/31/2019 at 12:11 PM, Boisvert said:

Citi removed my tradeline when it was sold to a JDB.

That is actually part of the new debt portfolio sales contract. The JDBs want the OC tradeline removed to avoid FCRA counter claims when they sue.  It has absolutely nothing to do with any letter you sent.

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58 minutes ago, Clydesmom said:

That is actually part of the new debt portfolio sales contract. The JDBs want the OC tradeline removed to avoid FCRA counter claims when they sue.  It has absolutely nothing to do with any letter you sent.

Good piece if Information about the contracts.

Re- read my posts. Nowhere do I state this was a result of any letters sent by me. 

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2 hours ago, Harry Seaward said:

The part you left out here is that you sent arbitration demand letters to the JDB before you sent the MOV letters to the CRAs, and then the "trade-in" (I think you mean "tradeline") was removed from your reports.  Well known fact around here is that JDBs remove tradelines from credit reports in anticipation of, and during, litigation from either side.  Since arbitration is a form of pseudo-litigation, it should come as no surprise that the JDB yanked your tradeline as soon as they got the notice that you were threatening action against them.  In other words, I know you think you're special but it wasn't the MOV letters that caused the deletion, and instead was your threat of legal action which they do for everybody.

You know I meant tradeline and you know its an autocorrect typo 🤦‍♂️ All these 'facts' have been disproven. I have been previously sued by OCs and all the original tradelines remained on the credit file. Another bank sued directly and the tradeline remained. The latest as recent as last month which I won in court. Whether it is by luck, due process, strategy or by "being special", success is measured by results. And the results have spoken for themselves: 632 to 745 in about 6 months. 

The one thing that has not worked for me is the "that no longer works" mentality. If the OP has the financial ability to pay this debt in full, he has all the leverage and his options are not binary. 

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55 minutes ago, Boisvert said:

If the OP has the financial ability to pay this debt in full, he has all the leverage

Same goes for the scads of people that have tried and failed.

You've had several opportunities to share your secret sauce and haven't. Why is that? 

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22 minutes ago, Harry Seaward said:

Same goes for the scads of people that have tried and failed.

You've had several opportunities to share your secret sauce and haven't. Why is that? 

what’s wrong with failing? Just move on to the next strategy. 

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21 minutes ago, Boisvert said:

what’s wrong with failing?  Just move on to the next strategy. 

People should be fairly warned that this approach or that is likely to fail, and we, as contributors, should present likely possible consequences of said failure.  In this case where someone is asking how to raise their score, for example, you should be telling people that your advice will likely actually result in a decrease in their score.  Of course, it could work out for the good because, after all, even a blind squirrel finds a nut once in a while, but it's not likely.  Do you see the difference?

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20 minutes ago, Harry Seaward said:

People should be fairly warned that this approach or that is likely to fail, and we, as contributors, should present likely possible consequences of said failure.  In this case where someone is asking how to raise their score, for example, you should be telling people that your advice will likely actually result in a decrease in their score.  Of course, it could work out for the good because, after all, even a blind squirrel finds a nut once in a while, but it's not likely.  Do you see the difference?

I think we also should concentrate in providing likely alternate options and avoid absolute facts that are in fact not absolutes. "Likely", "maybes", "hopefully" is what we are after. If we approach credit repair with this "You are doomed" mentality and "nothing works anymore" then we would get nowhere. I was cautions and was prepared to absorb the risks of any possible consequences with my approach and it paid off, with more than a single nut. So I'm a happy squirrel.  

The OP is financially capable of any burden this situation might bring. If it goes into collection, he gets the collection paid off and it'll be 5x easier to get a collection item thats paid off versus an OC tradeline. And with Citi, it is extremely likely the OC tradeline will be removed. 

Unless the OP's ultimate goal is to have a slight increase in score in the next 30-60 days (for no apparent reason) then it's better to shoot for a long-term strategy. Your advice, as well, should have been much better formulated. If the OP is looking to raise their score from 600, it'll have to be a very significant change to bring it to another classification. Marking this charge off as paid will have maybe a 20-30pt increase, especially in the beginning. I'd doubt he would get financed for anything he is after by going from 600 to 620-630. The OP is better off adding authorized user tradelines, including a secured loan, or using something like ScoreBoost or any other strategy.

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Actually, @Shiva go to Experian.com and sign up for their trial services (free for 7 days). Go to the Score Simulator and click on "pay delinquent balances off" and type in the amount you are paying, in this case $1800, and see what the simulator tells you. 

That should give you a much better idea than what anyone here can try to estimate. 

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1 minute ago, Boisvert said:

it'll be 5x easier to get a collection item thats paid off versus an OC tradeline.

That may be, but you're leaving out the part that 5x is still only 5x of 0.5% chance.

2 minutes ago, Boisvert said:

(for no apparent reason)

Who cares if they give you a reason or not?  They asked the question and stated their goal.

3 minutes ago, Boisvert said:

If the OP is looking to raise their score from 600, it'll have to be a very significant change to bring it to another classification.

Not true.  620 is a pretty well established "classification" for several sub-prime lenders.  And 640 is yet another for mid-prime lenders.  I said 40-50 points was a reasonable expectation for reducing extreme utilization to zero.

5 minutes ago, Boisvert said:

The OP is better off adding authorized user tradelines

Two things.  CRAs often discredit AU accounts when the user and primary so not share the same physical address.  Second, putting your credit in the hands of someone you don't know is a horrible idea.  So if OP has a family member they live with that has good credit that would be willing to do this, fine.  Otherwise, this is horrible advice.

2 minutes ago, Boisvert said:

Go to the Score Simulator and click on "pay delinquent balances off" and type in the amount you are paying, in this case $1800, and see what the simulator tells you.

This won't give an accurate result.  There is no option on there for "pay a charge-off to $0".  Also, it doesn't predict the effects in 3, 6 or more months down the road.

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@Shiva

If Citibank still owns the account, it would be much better to pay Citi than to wait for the account to possibly be sold to a debt buyer. 

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