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js317

Horrible credit and collections issues, where to begin?

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I want to get my credit back on track. My score is 520 but I have $22K in collections.  All 14 accounts are in collections, none are in good standing.  All 14 are unsecured credit cards.  All info is accurate so I can't dispute it  - I am aware that it is my debt and I am responsible for it.  Last payments on any account were made around July 2018 (19 months ago).  I want to begin to pay off my debt, but do it in a way that will restore my credit also.  I ran all 3 credit reports and made a list of all of my creditors names, phone numbers, current balances, along with original balances.

 

Out of the 14 accounts, 8 have been sold to collections agencies.  LVNV funding (2 different accounts $1496 and $672), IMC credit services ($110), NCB Management Services ($2,960), Portfolio recovery services ($3,125), and Midland Credit (3 different accounts $361, $813, $5,386).  The 6 accounts that are still with the original creditors are American Express ($814 but received a letter that they will settle for $375), Credit One ($1,389), Discover ($1,600), Merrick Bank ($1,789), Lendup ($758), and First Premier Bank ($884).  Most of these balances are 30-60% higher then the original balance (total original balances around $15K, so I currently owe $7K more then I originally did).

 

After reading and studying, my plan is to initially contact each creditor and collection agency and see what amount I can get them to settle for (as a lump sum payment), and see if they will accept a pay for deletion.  In your experiences, would they accept a lower lump sum AND a pay for deletion?  I can afford to pay $1,000 per month towards this debt.  My main concern is that I want to do this in a way that will restore my credit also.  Do you all have any suggestions about what I should do in my situation?  Thank you for taking the time to read my post!

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5 hours ago, js317 said:

In your experiences, would they accept a lower lump sum AND a pay for deletion?

It is certainly worth a try, but most places will only report "settled for less than full amount," rather than delete.

I've heard good things about the Dave Ramsey method, that, I believe, involves completely paying off cards, starting with the lowest balances. This then eliminates interest from the cards that are paid off, and allows the saved payments to then be applied to the higher balance debts. A variation on this may be to concentrate on the cards were arbitration is not an option, and leave those with favorable arbitration clauses until the end - that way, if they sue, you will have the leverage to get the trade line removed.

 

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43 minutes ago, Goody_Ouchless said:

It is certainly worth a try, but most places will only report "settled for less than full amount," rather than delete.

I've heard good things about the Dave Ramsey method, that, I believe, involves completely paying off cards, starting with the lowest balances. This then eliminates interest from the cards that are paid off, and allows the saved payments to then be applied to the higher balance debts. A variation on this may be to concentrate on the cards were arbitration is not an option, and leave those with favorable arbitration clauses until the end - that way, if they sue, you will have the leverage to get the trade line removed.

 

I did a variation of this. 
 

In those days, almost all the cards had arbitration, and arbitration scared the OCs. 
 

I started by paying off some cards with low balances.  The cards without arbitration agreements I negotiated a settlement, except for one low interest USAA card I kept current and still use.  Then I spent the next 6 years fighting the cards with arbitration agreements. 
 

In some cases I was able to get a little money fir violations.  
 

Altogether I paid less than 10 cents on the dollar, including the low interest rate card I kept.  For the cards I negotiated or fought, my aggregate was leas than a penny on the dollar.  

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