I now have negotiated with all my creditors except CapitalOne. I have agreements with Citi, BOFA, Credit Unions, CitiFinancial, etc for 3 - 7 year payment plans with interest rates as low as 0%. CapitalOne put me in their hardship program, but all this does is hold off late fees, etc. The interest comes down to 15.9%, but the problem is that the minimum payments on these several accounts ($300) is twice what I can afford to pay. I am writing a letter to Cap1 with a proposal to pay $150 month for seven years at 1% interest. This will satisfy the $12K I owe. Is there any particular wording I can use that might help? Should I wait and let them turn the accounts over to Allied InterState and negotiate with the collection firm? Any help or comments would be appreciated. One of the accounts is within a few weeks of charge-off. I'm not intimidated by collection agencies, and I do want to pay this debt down. As mentioned a while back in a previous post, I thought about a chapter 13 BK, but decided to go it on my own. So far, I am way ahead of the $3500 attorney fees and the 10% trustee fees for my district. In addition, I continue to exercise some "modest" control over my paycheck.
DOLA??? Never agree if you cannot keep your agreement. Myself I think you are digging a hole as you have not settled for an amount you can pay and get it a done deal. Your time frame is a LONG one as well. Before you negotiate any further, I would think about lowering what you offer and making the time frame a LOT shorter. JMO Woofer
DOLA is 60 -180 days depending upong which of the 4 cards is up for discussion. Why would I settle with the original creditor for less than the amount owed and run the risk of a 1099? I can afford the amount proposed for the time-frame proposed. Would it seem more reasonable to offer less and reduce the time-frame? I cannot afford even a 20% of debt one-time payment, so that leaves me with negotiating a longer term payment plan. Can you provide me with any details on what to offer on $12K of debt where I can afford $150/month payments? Thanks in advance.
Based upon the information provided, your best offer must include a reduced amount for total owed. At $150/month, it would take over seven years to repay, and that is with no interest at all. It is doubtful any creditor will accept these terms. You need to work out several different options for repayment; i.e., excatly the maximum you could get together to pay now, what combinations of reduced principal/payments you could live with, etc. The key is to have several options to consider when you negotiate. You may have to sit down and do a full review of your finances, spending and budget. Brainstorm for other ideas like reducing expenses, increasing income w/another job, selling off stuff around the house, etc. Get creative...
Hey I was given my take on it from my experience. I never settled for the full amount and I negotiated for no 1099, which CAN be done. Also if you do get a 1099 you have to figure out if the income tax on such is a benefit to settle for less, many times it is. Didn't you write that you now cannot pay what you said you could? I would but that is me. I do know from having been on the other side as well, as I would rather have LESS money FASTER than WAIT for dribs and drabs, and many OC's and CA's and JDB's feel the same way. This way it is a done deal and they don't have to chase you for the money should something happen that you cannot keep with the agreement. [quote Can you provide me with any details on what to offer on $12K of debt where I can afford $150/month payments? [/quote] FME a 15K debt I offered to a JDB, 1500 and they took it with NO 1099. For a 8K debt, I offered 3K to an OC and they took it with NO 1099. For a 18K debt, to Discover, I got them to reduce the debt by 5K and NO INTEREST for one year. Everyone has dealt with these situations in various ways. I had a LOT of debt, in the 6 figures and the OC's that worked with me got paid, the ones that didn't haven't. I also had to figure how much time I wanted to deal with the damn JDB's and I negotiated or countersued and I am WAY AHEAD. I now have two JDB's debts lefts and am working on them,or I should say one I am suing one and another I am waited it out of SOL, which might happen. What I am saying is everyone has a way of dealing and you have to find out what way is best for you. Just don't get bogged down and commit yourself to something you can not do. Woofer
Don't forget that a form 982 can blunt the effects of a 1099-c ... get it and its instructions and see whether you can stand to have 1099-c forms filed on you.
Thanks for the replies. This entire process has been like a second job! I do see light at the end of the tunnel. This is the last debt I need to negotiate and Cap1 seems to be the hardest to deal with. Since the debt has not even been charged off, perhaps I have a bit of time. I only get the occasional call on these cards, but I'm trying to be proactive. This debt is the last one left to negotiate. It does make sense that should this go to collections, I might have better luck negotiating the total amount downward. My problem will be that I can't make a lump-sum of more than $12K. I guess I'll let this hang a bit longer. Thanks for all your thoughts.
FWIW,unless yo are going to get a PAY FOR DELETE, and a lot of consideration on the debt, I would let it go to charge off and then let it be sold. Once there you will be able to get rid of the debt if you want to negoitate for pennies on the dollars owed. Your TL is still going to be the same age abouts. You mentioned you have 12K to plunk down? I woudn't! CONCENTRATE ON THE DEBTS YOU HAVE AGREED TO AND GET THEM A DONE DEAL ASAP. Oh and true we all spend mucho time on figuring out what to do and defending our rights and getting our credit back to a high score. It can be done, but it DOES take up a LOT of time, but I feel it is well worth it! Good luck Woofer
I don't think Cap One sells their paper, so you probably won't get a CA or JDB to negotiate pennies on the dollar.
Hedwig, I used to think that they didn't sell either, but on one board someone was negotiating with a JDB on a Cap One account,so at times they may sell their accounts. I had heard also that CITI and DISCOVER never sell their accounts and have found this not to be true. Woofer
I think Hedwig is correct, Cap1 rarely sells their paper. They have reduced many of the positions for these departments, but I think they hold as much as possible.
Cap One owns a CA (not a JDB) and you may deal with them, but ultimately it's Cap One. And they're only collecting--they don't own the debt, Cap One still owns it. I suspect they didn't realize it was a CA and not a JDB. I'm not sure about Citi and Discover, they may sell some sub-prime, but at least Citi I believe holds their own prime paper. Remember that a CA may be collecting, but may only be assigned the debt, they may not own it. Citi or whoever may still own it and assign for collection.
A bit more sleuthing today, and it appears that Cap1 assigns debt to one of several CA's including Allied Interstate, but they do not appear to "sell" the debt. If this occurs, is it possible to work with AI and get some type of payment arrangement? I'm thinking that Cap1 is not set up to deal with negotiations but their collection firm (AI) might be.
Sounds good. I do know people get confused with CA's and JDB as some are one in the same, ie CACV and his CA's. UGH!
I don't know if this adds anything to the issue but : 1)I have a Cap*1 CO for 800$ from early 2005. They haven't sold it to anyone and now that the SOL is about to toll on it(end of March), they have been reporting every month from Nov 2007 to Exp and TU. 2)I have a citi card CO from the same time for 5000$ and they are doing exactly the same. Been reporting every month for the last 4 months and the SOL is again Mar 2008. For my sake, I hope woofer is right and they sell to JDBs . I don't have any advice to give other than don't try to go for long term payment plans as things could change in the coming years and what's affordable now might not be affordable then. Good luck!
Interestingly enough, the first time I went into default I heard from their (Cap1) collection party (Allied Interstate) within a 60 days. I attempted to meet Cap1's hardship program conditions and made a few payments. I am now close to 180 days on 2 of 4 accounts and have not heard a peep. It could be that there are now a lot of "larger fish to (attempt) fry," and I'm not on the top of the list. The collection agency they used was Allied Interstate, but I was directed to make the checks payable to Cap1, so I know that Allied did not own the debt. In fact, once I made a payment or two to Cap1, I never received any further correspondence from Allied. Pretty strange, but then again, it could be that Allied prefers to first go after the debt that they "own." JMHO
