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Re: Credit Card Settlement


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Posted by Mike on December 19, 2001 at 00:20:42:

In Reply to: Credit Card Settlement posted by Dave on December 18, 2001 at 20:36:35:

Dave,

I had some of your same questions a few weeks ago and Linda was kind enough to explain them where I could understand them.
To your first question, it will show on your credit report as SETTLED ACCOUNT. It means you actually paid less than the full amount and the creditor "wrote-off" the difference. More than likely, the creditor hasn't informed you that this leaves a bad mark on your credit record. He doesn't care--he figures giving you a bad reputation is just reward for your not paying the full amount due. So your answer to question #2 is yes it affects your credit and in a negative way.
You would be better off if you pay the full amount due and insist that they show your account as PAID with a balance of -0-. Contact them -- you will find that they will be eager to be paid the full amount that you owe. They are guessing that you can't afford to do that, so they are enticing you with a lesser amount and making it sound too good to be true, and then thanking you by trashing your credit record !
Make them send you a letter stating whatever terms you two agree on. Otherwise, you will have no recourse if they renig on their offer. Document and get documentation on everything they do and say !
On your question #3, I'm not sure if you have any options if you agree up front to "settle". Linda would be a better person to answer this question for you.


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