How good of an Idea is this??

[tigger22472]

What is the name of your state? Indiana

As some of you know I've been working on trying to get my credit up. I have some bad things on it and even paid off 4 of them with our tax check. My husband has more things on his then I do as a lot of mine is just I don't have a lot of credit either.

I got an offer from Capital One that I want to see if this is a good deal or not. They take something that I owe through a collection agency (would have to look up the date on it as it even says it might be charging off soon anyways). They let me pay it off intrest free. Then as I pay it off they give me a credit limit not to exceed 200$ eventually (not sure the intrest rate at that point.. not really concerned since I figure I'll just pay the bill off first). According to them the collection agency will then leave me alone once I start paying it through them but if I miss a payment it goes back to them.

If I understand it right then I end up paying off something on my credit and start building credit back? Does it sound legit?

 

[anon29072]

If you really want a good deal, I have some parcels on the moon that I am selling dirt cheap.

In all seriousness, Capital One offered you this deal? Was it on the phone, or in writing? It smells fishy to me. For starters, if they are willing to let you pay off your debt to them "interest free", then why would they even bother going through a collection agency to take your money? Second, suppose you do pay them off eventually, how will this be reported on your credit report? If it shows that they settled for a lesser amount, it will still look bad against you. Also, if you are making payments and default again, then it also extends out the length of time this entry can be reported to a CRA. Otherwise, it's just 7 years. Third, if they were to give you a credit limit of $200, that's not going to help you in your effort to rebuild your credit. Having a $200 limit is not a great risk on the part of the creditor.

I'm not advocating that you do the wrong thing by ignoring your financial responsibilities. I would just be careful and get all the details and facts in writing before you agree to anything.

My 2-cents.

 

[tigger22472]

The original creditor isn't Capital One. The collection agency got it from the original creditor and Capital One sent me this offer through the mail. I'm not a credit card person, never have been. I just wondered what other risks other then the obvious accepting this offer there were.

 

[anon29072]

Who is the original creditor? How much money are you talking about? Is Capital One associated with the CA? Sounds like there might be a relation somewhere. Otherwise, why would they offer you "interest free" credit? Again, I would be wary of this offer. It doesn't sound like it's going to help your credit situation. If it's been a while since your last payment to the creditor was made, the debt has probably been charged off and that's going to be a black mark on your credit report for 7 years.

I'd at least write the CA and ask for validation. It could be possible that they don't have proof. If that's the case, you can write a cease and desist letter asking them to buzz off. Make sure to send your correspondence to them certified, return-receipt requested. Don't accept any verbal offers, and NEVER EVER give a CA your checking account or other credit card numbers. Make your payments with a money order.

 

[tigger22472]

Oh I agree with not giving the CA any info.

THe original creditor is Fingerhut and even in the offer from Capital ONe it says the account maybe charged off although i think it still has almost a year on it. The CA has sent me things in the past for it and I have validated it a while back. The debt is like 334$ I think and the payments are like 35$ a month to pay it off.

 

[anon29072]

Here's the deal: If you make payments on $334 @ $35/month, then it will take you a little over 9 months to pay it off. Why not just pay it off in one lump sum? It's very unlikely that you will be sued for such a paltry sum. So, if you are paying it off because you feel that's the right thing to do, then by all means, pay if off.

If you are paying off this debt because you want to improve your credit rating, forget it. If the debt has been charged off, you're not going to get that removed for 7 years. The CA can report "paid" or "paid as agreed" after you have paid it off, but you have to negotiate with them to do that. Get It In Writing.

As for Capital One, leave them out of the picture. I don't see where they can help you. If you can't afford $334 now to payoff this debt, then don't even consider their offer of a card with a $200 limit. The only good it can do is get you into more trouble later if you use it and then find you can't pay it.

 

[Ladynred]

I have this to say about CRAP1's "offer" -- PUT IT THRU THE SHREDDER !!!

How old is this Fingerhut debt ??

This is a rotten 'deal' that Crap1 (and now others) are using to get people to put OLD debt on NEW accounts. If the debt was SOL, it will start a NEW SOL on the new account allowing them to stick it back on your credit reports for 7-10 more years ! It would also allow them to sue you should you ever default again -something they could not do if the original debt was past the SOL.

Throw it in the TRASH ! There are other, better ways to rebuild your credit.

 

[tigger22472]

I have this to say about CRAP1's "offer" -- PUT IT THRU THE SHREDDER !!!

How old is this Fingerhut debt ??

This is a rotten 'deal' that Crap1 (and now others) are using to get people to put OLD debt on NEW accounts. If the debt was SOL, it will start a NEW SOL on the new account allowing them to stick it back on your credit reports for 7-10 more years ! It would also allow them to sue you should you ever default again -something they could not do if the original debt was past the SOL.

Throw it in the TRASH ! There are other, better ways to rebuild your credit.

Gotcha lady...the Fingerhut debt is nearing the SOL now I believe. I can't remember without my CR in front of me. I've just been grasping to find ways to get my credit back in shape so that I can qualify to refinance my house next year or the year after. I THINK back in Feb. of 03 my credit rating was 580 something and was told my BIGGEST problem was that I didn't have ENOUGH credit. Not that I want credit cards.. can't get them anyways...but thought that might be a way to help it. Buying a new car help... even though I had trouble finding financing I did finally get it and it shows. I did pay some credit things off recently and working on more... just wondered how legit this was.