Setting up a payment plan

[cashonlynow]

What is the name of your state? CA

Hello everyone, I have a few questions about trying to set up a payment plan for a delinquent charge card.

The account I am talking about is a Capitol One account and it has been delinquent for over a year now, I think the last payment was made in October 2002. The last time I received any correspondence from them, the balance was around $3000.00 and that was probably 4 or 5 months ago. The letter they sent me was an offer to settle, and I believe it was for about $2400.00. I had no way of obtaining that amount of money and could not afford any type of monthly payment.

I am finally now in a position where I can make payments of about $100.00 a month and I want to deal with this. My questions are, where do I start? Do I start with validation? Will they work with me for just $100.00 a month? Should I call Cap One to find out if my account is with a collection agency?

Thank you in advance for any responses.

[JETX]

"where do I start?"
*** That depends largely on what you want to do. Most creditors will accept a larger settlement for immediate payment, so if you can accept their contacting you for a while, you might save the $100 per month and offer them a payment of $1000 in 10 months. Or, if you want to make scheduled payments, you might contact them and SUGGEST you might be interested in making SOME payment plans in return for a reduced principal. Whatever you may be able to negotiate would depend largely on their 'interest' and your negotiating skills.

"Do I start with validation?"
*** Only if you dispute the amount being claimed. Otherwise you have already accepted the fact of the debt.

"Will they work with me for just $100.00 a month?"
*** No one can answer that. Of course, no matter what you offer will not be enough. So, give yourself some 'up room' in the negotiations.

"Should I call Cap One to find out if my account is with a collection agency?"
*** My position is it shouldn't matter if it is or not. Try to deal DIRECTLY with the creditor. They will tell you if there is a problem with that.

Oh, and congratulations on your acceptance of responsibility for your actions. That is somewhat unusual on this forum.

[cashonlynow]

Thank you very much for your reply JETX.

I have another question. Should my initial contact with Capitol One be on the phone or in writing?

I also appreciate the congrats comment for my accepting responsibility. It’s not easy for me to keep in mind that I am in fact the one who charged on the credit card. With interest, over the limit, and late fees, the amount has become overwhelming, but I do owe the money.

[JETX]

"Should my initial contact with Capitol One be on the phone or in writing?"
*** Your initial contacts can certainly be by phone, but any FINAL agreement should be in writing.
Best of luck and keep us apprised.

[cashonlynow]

Well, I called Capitol one yesterday and I didn’t really get anywhere with them. My current balance is now 3703.00 with interest at 25.9%. I told them that what I could afford is $65 a month to give myself “up room” as was suggested. The guy I spoke with then told me that they won’t turn down any money but they won’t negotiate a payment plan, reduce interest or late fees unless I pay at least $200.00 a month (no way). Even at $100.00 a month I’m really not getting anywhere if I continue to accumulate all this interest.

Should I just start sending them money with no payment plan?

[cashonlynow]

Some new info:

I was hoping to use my tax return as some kind of leverage for this but I just found out yesterday that my refund will only be $377 (I was hoping for at least $800). I think if I put $100 with that though, I may get somewhere. Should I play hardball and threaten not to pay? Do you have any negotiating tips I could use when I call them?

[Tayla]

Cap One can sway either Hard Ball or amicable negotiations that aid the consumer. All correspondence needs to be in writing. Paper Trails work best when negotiating. Use Certified mail. Also a healthy tip: When negotiating and accepting responsibility ask if they will add a positive notation on your credit report since it will show as a mark against the score. Sometimes a simple: "Paid as agreed/Account closed" will be sufficient. Whatever you choose to do, keep it within your budget and protect your credit.