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justalayman

Senior Member
A settlement is a done deal.
but GET IT IN WRITING and retain that record of contract forever. Many times CA's have either tried to renege on such deals or they sell off the unpaid portion (very improper thing to do but given some of the scum CA's out there, it happens sometimes) and you could be faced with proving the debt was negotiated to a settlement amount and that was paid.




paying the settlement, and sometimes simply the acceptance of the offer, even if only verbal in some states, restarts the clock on reporting it.
 


antipode12

Junior Member
OK, so is it better for me to negotiate with Debt Collectors now, or in few years if/when they decide to bring a suit?
 

bdancer

Member
paying the settlement, and sometimes simply the acceptance of the offer, even if only verbal in some states, restarts the clock on reporting it.
If you are referring to reporting the debt to the credit bureaus, Federal law governs the reporting period, not State laws. Paying does NOT restart the 7 year reporting period.
 

bdancer

Member
OK, so is it better for me to negotiate with Debt Collectors now, or in few years if/when they decide to bring a suit?
Waiting till they sue is a very bad plan. Once the lawsuit is filed, they will be less likely to accept settlements and the debt may be larger due to added interest and fees.

Best to negotiate settlement now. Save up for a lump sum offer. Depending on the age of the defaulted account, you should be able to settle for 25% to 50% in a lump sum. Just be sure to get any settlement agreement in writing before you pay. Don't give the collector direct access to your bank account -- pay with a money order or cashier's check. Keep that agreement and your payment proof forever.
 

justalayman

Senior Member
If you are referring to reporting the debt to the credit bureaus, Federal law governs the reporting period, not State laws. Paying does NOT restart the 7 year reporting period.
a new agreement can though depending on how it is structured.
 

justalayman

Senior Member
Waiting till they sue is a very bad plan. Once the lawsuit is filed, they will be less likely to accept settlements and the debt may be larger due to added interest and fees.

Best to negotiate settlement now. Save up for a lump sum offer. Depending on the age of the defaulted account, you should be able to settle for 25% to 50% in a lump sum. Just be sure to get any settlement agreement in writing before you pay. Don't give the collector direct access to your bank account -- pay with a money order or cashier's check. Keep that agreement and your payment proof forever.


unless the original contract allowed for interest and fees, there are no additional interest and fees to be concerned of. The contract the the debt was accrued under remains in force regarding those issues. I suspect this is a credit card issue and as such there is interest and likely fees but it was not totally clear to me that it is a credit card matter.
 

bdancer

Member
a new agreement can though depending on how it is structured.
Would the new agreement be considered a new debt? I can see how that would allow it to be reported to the credit bureaus, but if payment was made according to the terms of the new agreement, it would not be reported as a negative.
 

justalayman

Senior Member
Would the new agreement be considered a new debt? I can see how that would allow it to be reported to the credit bureaus, but if payment was made according to the terms of the new agreement, it would not be reported as a negative.


Generally and typically no they do not work that way but it could if the CA created a new contract. It would essentially be a refinance of the original debt with the CA as the original creditor now.

and I agree that as long as the payments are kept current, not only would it not be a negative on their credit report, it could be beneficial.
 

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