Hello to everyone. I've been lurking around this board for the past several months and have gotten good bits of information and advice. Anyway, I am trying to clean up my credit reports and I have a charged off account with Citibank. The original amount was $5400 last Oct. 2000 and currently it is now up to $7400. I called the collection agency - California Financial Credit Association to see if I could settle the account. I offered them $2500 to settle the account but they refused stating that Citibank does not settle for less than 60% and offered a settlement of $4400. I refused since I didn't have that much money anyway. They said that they will now pursue litigation against me and once the judgement comes out, they will garnish my wages. I don't really want to file bankruptcy since I've been able to clear up my credit file quite successfully and this account is the last major hurdle I need to overcome on my road to creditworthiness again. My questions: 1. Does anyone have any experience with this collection company and with Citibank per se? Are they telling the truth about Citibank's settlement policy? 2. What other options are available to me? I don't want to have a judgement on my credit file and would really like to settle this debt. 3. How long will it take the court to process the judgement against me if they file today? Is there anything I can do to stop that process? 4. How should I negotiate with the collection agency? If I pay the amount they proposed, will they remove all the negative references to this account? Any help, information and advice would be much appreciated. If anyone can provide me with other pertinent information or sources where I can get more information, I would really appreciate it.
1. I don't have any specific experience with Citibank or their collection agency, but 60% may be what they are willing to settle for. 2. If they file a judgement you will be served, usually within 15 days. You will have to file a counterclaim and/or appear at the hearing. The judgement can be awarded at the time of the hearing, can be as soon as 30 days from filing. 3. If I were negotiating settlement, you may ask for deletion of negative item for payment or settlement. They may or may not agree. 4. You can continue to dispute, but this may not stop the judgement filing. If the debt is not valid then this would be your counterclaim on the judgement. 5. You can file for bankruptcy, but get all of the baggage of bankruptcy. FU-TU
Most creditors don't want to take less than 60% because they are already on the hook for a 30% or more fee to the CA. However, these guys should be looking to avoid a court appearance, fees, etc... It is very expensive to get a judgement and enforce it when you consider court costs, attorney's fees and such. I know because I used to do this for a living. Why don't you approach them about a payoff with maybe two or three installments rather than one lump sum that you can't afford. Garnishing wages and attaching bank accounts is a big pain, no one wants to do it if it can be avoided. Use that leverage to your advantage. If you pay them $1500 a month for example, they will get paid in three months. If they go the court route, they won't have a judgement for at least 30 days, then another 30 or so to process garnishments, then they still only get paid in installments. Plus they have to pay the lawyers at that point. More mouths to feed. Try a take it or leave it approach, with a guarantee in writing that they will remove derog. info.
