I owe approximatley 40k on various credit cards (8 accounts). I have not paid creditors in the last six months. Both my wife's credit and mine are in the tank, a shade above 500. I am debating whether or not to pay as much as possible on the debts to try and remove negative TL's or just negotiate the lowest amount acceptable and pay all off in a lump sum. To summarize; 1. Owe 40k 2. Late on all accounts (6 months) 3. Pay enough to try and salvage credit or pay as little as possible to settle. P.S. Already own a home so credit concerns not as great as some. Please advise David
I would suggest "settlement", see what you can work out with the creditors. I always recommend avoiding bankruptcy at all costs. I would try to negotiate "settlement for deletion" of any negative information on your crdit reports. I would say your best bet, and "deal", is to try and negoatiate a "plan" (i.e. reduced interest, principal only, etc.) If they have not yet sold these accounts to a collection agency, you probably have a good chance at a favorable settlement. Good Luck....
Thanks for the advice. However, I am new to this sort of thing and obtaining a settlement on a cc is something I have never done. My credit score per myfico.com is 503 now and this is why I am questioning whether or not settling for the minimum amount is a good bet or trying to pay as much as possible to avoid further negs on credit report. Will paying the most possible and having the creditors agree to state as "paid in full" and no 1099 filing be that beneficial to my credit if my score is already so low? Also, can the negatives (past due 30, 60 days etc) already on the report be removed by the creditors? Thanks, DavidS
