i have two unsecured cards. 10 k each. Maxed out. My fico is 562 and have a good 9 yr credit history. one charged-off a month ago. a second card could get charged off in two days if i don't settle. i can settle it for 3K of 11k (i.e. 30%). what will my score be if i allow it to charge off vs settle?
Both a charge off or settlement will hurt your FICO scores, although it's better to avoid the charge off if at all possible. A "settled for less than full balance" or "settled as agreed" mark on your credit reports is negative, but it will be better than having a charge off that will sit on there for the next 7 years too. Potential lenders like to at least see that you've resolved old debts. There are too many other variables in your credit profile to tell you exactly how much your score would shift, but it will definitely go in the wrong direction unless you're able to get the negative marks removed altogether in return for payment.
I am willing to pay to get some good advice if necessary. I need to resolve all this by tomorrow. Any ideas?
If you've got the dough and you know who you owe, settle. Avoid another charge off if at all possible and don't forget to negotiate your credit score as part of the process. Go for the best possible notation you can get on your credit reports.
