catnip757

Settlement before attorney referral with Discover

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Hello I'm in Virgina about to have my account referred to attorney in late February. The debt is about 13k and I'm not disputing I legally owe it. I can get about 5k cash and would consider offering to settle with them before it goes it court or arbitration. Has anyone successfully done this before they were sued by Discover?

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11 hours ago, catnip757 said:

Hello I'm in Virgina about to have my account referred to attorney in late February. The debt is about 13k and I'm not disputing I legally owe it. I can get about 5k cash and would consider offering to settle with them before it goes it court or arbitration. Has anyone successfully done this before they were sued by Discover?

Original creditors such as Discover would prefer to settle rather than sue.   I’m just not sure that $5000 would satisfy, but you could give it a try.  They might be willing to set up payment arrangements.  Good luck!

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2 hours ago, BV80 said:

Original creditors such as Discover would prefer to settle rather than sue.   I’m just not sure that $5000 would satisfy, but you could give it a try.  They might be willing to set up payment arrangements.  Good luck!

Thank you for replying I've read through tons of your posts on this forum appreciate everything you do here. Sounds like I should just contact them directly and start negotiating? I want to be clear with them I would be gifted the money from a family member if they agree to a reasonable settlement paid in full. 

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2 hours ago, catnip757 said:

Thank you for replying I've read through tons of your posts on this forum appreciate everything you do here. Sounds like I should just contact them directly and start negotiating? I want to be clear with them I would be gifted the money from a family member if they agree to a reasonable settlement paid in full. 

All you can do is negotiate.  However, I’m not sure how you get the money would make a difference, because is strictly business to them.  

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On 1/25/2021 at 10:12 AM, catnip757 said:

Thank you for replying I've read through tons of your posts on this forum appreciate everything you do here. Sounds like I should just contact them directly and start negotiating? I want to be clear with them I would be gifted the money from a family member if they agree to a reasonable settlement paid in full. 

Yes contact them but do not tell them where you work. Offer 30% and see what they say and counter and let us know what they say. 

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As a rule of thumb, there are several windows for negotiation with Discover. This is one of them. 
 

The next good window is between the time you file for arbitration and when their fees are due. Another window is between the time arbitration is scheduled and when they pay.  

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I just settled with Discover for a charged off account for 35%. It was easy too, I just told them I wanted to settle and they asked me the amount so I started at 35%. They told me to hold while they input it into their system (I could hear them typing) then viola! Another one bites the dust! 

Once I have settled all of the "most likely to sue" accounts, I will post an update with amounts and all that jazz. I think it helps to read about other people's experience. Think positive always! 

 

 

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4 hours ago, womanonfire said:

I just settled with Discover for a charged off account for 35%. It was easy too, I just told them I wanted to settle and they asked me the amount so I started at 35%. They told me to hold why they input it into their system (I could hear them typing) then viola! Another one bites the dust! 

Once I have settled all of the "most likely to sue" accounts, I will post an update with amounts and all that jazz. I think it helps to read about other people's experience. Think positive always! 

 

 

I'm am in a similar situation as the OP. I owe around 10k and have about a month and a half until sent to attorney. I offered about 30% today and they said they could only do an amount that was around 60-65%  I'm wondering if I should wait until right before sent to an attorney, or if I would be able to settle for less if it was charged off? Any advantages to settling before charge off? I've heard that the charge off will make your credit score less but I'm not particularly concerned about that. 

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17 minutes ago, aFreeperson said:

I offered about 30% today and they said they could only do an amount that was around 60-65%  I'm wondering if I should wait until right before sent to an attorney, or if I would be able to settle for less if it was charged off?

Settling is about leverage.  Discover is an original creditor which means the have everything they need to prove their case.  We do have anecdotal evidence of them getting ticked off and simply refusing to settle after rejecting what they feel is a ridiculous offer.  That said there are "windows" of opportunity to settle with them.  If it is about to be sent for legal review then it is already charged off.  They do not pursue litigation until after that happens.  Charge off is an accounting term and has ZERO affect on their pursuit of it.  

I would set a time frame every two weeks, once a month etc.  and call and make another settlement offer.  Those discussions are not admissible in court.  As it gets closer they may go ahead and bit the second or third time you offer a settlement.  Chances of getting 30% from an OC who can sue for all of it and the costs plus post judgment interest are slim but not none.  Keep in mind that what you have to deal with is based on the collection laws of your state and your courts.  Others may have a very different result which has no bearing on how Discover will deal with you or your account.

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45 minutes ago, Clydesmom said:

Settling is about leverage.  Discover is an original creditor which means the have everything they need to prove their case.  We do have anecdotal evidence of them getting ticked off and simply refusing to settle after rejecting what they feel is a ridiculous offer.  That said there are "windows" of opportunity to settle with them.  If it is about to be sent for legal review then it is already charged off.  They do not pursue litigation until after that happens.  Charge off is an accounting term and has ZERO affect on their pursuit of it.  

I would set a time frame every two weeks, once a month etc.  and call and make another settlement offer.  Those discussions are not admissible in court.  As it gets closer they may go ahead and bit the second or third time you offer a settlement.  Chances of getting 30% from an OC who can sue for all of it and the costs plus post judgment interest are slim but not none.  Keep in mind that what you have to deal with is based on the collection laws of your state and your courts.  Others may have a very different result which has no bearing on how Discover will deal with you or your account.

Thanks for the information. 

As of now my account is actually still open so it has not been charged off.  What are the windows of opportunity with Discover? I was told my account would be sent to the attorney near the end of march. I will keep in contact every couple of weeks until then and hopefully be able to reach a settlement I can afford. 

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12 hours ago, aFreeperson said:

I'm am in a similar situation as the OP. I owe around 10k and have about a month and a half until sent to attorney. I offered about 30% today and they said they could only do an amount that was around 60-65%  I'm wondering if I should wait until right before sent to an attorney, or if I would be able to settle for less if it was charged off? Any advantages to settling before charge off? I've heard that the charge off will make your credit score less but I'm not particularly concerned about that. 

I was in a hardship program with them before I defaulted on that. Not sure if that makes a difference or not but DOLP was 3/20. 

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On 2/11/2021 at 7:24 AM, womanonfire said:

I was in a hardship program with them before I defaulted on that. Not sure if that makes a difference or not but DOLP was 3/20. 

Also was in the hardship program and defaulted. I'm going to submit my first offer to them today then update this post.

 

UPDATE: Offered them 30% they countered with 60%. I think I'll hold out a little longer and see if they come down a bit. 

Edited by catnip757
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On 2/10/2021 at 7:28 PM, Clydesmom said:

One of our members @BackFromTheDebtknows more about that than I do.

My Discover case was different, and Discover even changed their arbitration agreement in a way that avoids what happened in my case.  So I got a settlement that would pretty much be impossible now.  

In any case, there is a similarity between what happened to me and what happened to another poster.  Both of us took the case into arbitration, offered a settlement, and had it rejected.  Right before the hearing, between the time they got their bill for the hearing and when the hearing was to take place, the offer was accepted.  

So the best times for negotiation appear to be:

1. Before they actually sue you.

2. After you file in JAMS, but before they pay the fee.

3. Right before the hearing, before they pay the bill for the hearing.  

If 60% is too high, it is possible they will go lower in step 2 or step 3, but there are no guarantees.  Nothing is guaranteed.  In my case the attorney was a brand new collection attorney, for a very small law firm, and he really didn't have the time to do all the work on the case.  If you get a big law firm, or at least one that has experience with JAMS, your result may or may not be different.

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On 2/10/2021 at 6:19 PM, aFreeperson said:

I'm am in a similar situation as the OP. I owe around 10k and have about a month and a half until sent to attorney. I offered about 30% today and they said they could only do an amount that was around 60-65%  I'm wondering if I should wait until right before sent to an attorney, or if I would be able to settle for less if it was charged off? Any advantages to settling before charge off? I've heard that the charge off will make your credit score less but I'm not particularly concerned about that. 

I think it is easier once charged off but they also may go by the amounts. I'm having a similar experience trying to settle with Chase on an account that is not charged off whereby they won't settle for less than 60%. Interestingly another account with Chase settled at 36% but that one was charged off. It may be they want higher because they think you give a damn about a charged off account affecting your credit. Mine is trashed so I couldn't care less. 

I have a post in the Debt Settlement forum of all the accounts I've settled so far. It's really a good feeling to beat down the debt. 

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On 2/25/2021 at 8:27 AM, womanonfire said:

I think it is easier once charged off but they also may go by the amounts. I'm having a similar experience trying to settle with Chase on an account that is not charged off whereby they won't settle for less than 60%. Interestingly another account with Chase settled at 36% but that one was charged off. It may be they want higher because they think you give a damn about a charged off account affecting your credit. Mine is trashed so I couldn't care less. 

I have a post in the Debt Settlement forum of all the accounts I've settled so far. It's really a good feeling to beat down the debt. 

Just tried again today for 30 but they stuck to their guns at 60. Charge off is today.

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11 hours ago, catnip757 said:

Just tried again today for 30 but they stuck to their guns at 60. Charge off is today.

I would give it another 30 days before following up or wait until you get a letter. They will pass it on to another department that will try to collect and you may get a better offer. The offers from Discover were better the longer I waited. 

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27 minutes ago, womanonfire said:

I would give it another 30 days before following up or wait until you get a letter. They will pass it on to another department that will try to collect and you may get a better offer. The offers from Discover were better the longer I waited. 

I actually know which law firm they will be handing it off too. They are right down the street from me. It would be a funny scenario if I hired them to represent me on a different matter so Discover couldn't use them. I'm sure they would just find another firm to use eventually.

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Thanks for the information everyone. I have a synchrony account I will try to settle also. If I settle before charge off is there a way that I should ask for it to be reported to the credit agencies that may make it affect my credit less? I seem to recall reading something about that.

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On 2/27/2021 at 7:25 AM, catnip757 said:

I actually know which law firm they will be handing it off too. They are right down the street from me. It would be a funny scenario if I hired them to represent me on a different matter so Discover couldn't use them. I'm sure they would just find another firm to use eventually.

60% lump sum is what they countered with, or 60% paid in payments? Honestly doesn't sound too bad, 60% of 13k, its not much more really than you planned to settle with to begin with. If they will take payments, give them the 5k you can now and pay off the other 2800.

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On 3/1/2021 at 5:23 PM, alwayswinning36 said:

60% lump sum is what they countered with, or 60% paid in payments? Honestly doesn't sound too bad, 60% of 13k, its not much more really than you planned to settle with to begin with. If they will take payments, give them the 5k you can now and pay off the other 2800.

Holding out for 30%. Doesn't make a difference what I pay them to my credit score just my bank account at this point.

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