Resurgent Credit offer

[nobody]

What is the name of your state? Tx
Here is the main text of the letter I received:

Resurgent Capital Services, LP is expanding the options available to you to resolve your debt. LVNV purchased the debt you originally owed to XXXX. As of the date of this letter, the balance you owe on your debt is XXXXX.XX. Arrangements have been made to pay your XXXXX.XX in full by balance transferring XXXX.XX of your debt to the new visa card and the remaining XXXX.XX will be forgiven. When you accept this offer, collection activity will stop. When your credit card is issued, your credit card account will be reported to the credit bureaus and if your old debt is being reported to the credit bureaus and unpaid, it will be reported as paid.
TIME-BARRED DEBT: If you pay your debt in full by balance transferring XXXX.XX (the settlement amount) transferred and any charges onyour new visa credit card account wil be valid, enforceable and can be reovered by any lawful means, even if the age of your debt being paid by the balance transfer would prevent a lawsuit from being filed to collect it.

This is a debt I owe and would like to pay it. Yes it is a few months past the SOL but I have spent the last year paying off alot of bad debt I have and only have 3 creditors left. I want to pay to clear them up. This is a large debt and the settlement amount is for 35% of the total debt being transferred to a credit card. The bank is Plains Commerce Bank, SD and the terms are 19% interest and no other/hidden fees. I can have this paid off in a year if I accept the credit card but cannot come up right now with the lump sum being settled for. I really would not get into any payment terms with the collection agency itself.

My questions are these:
Isn't this as good as any settlement as long as I make my credit card payments timely and pay off the balance?
Once the balance transfer takes place would I still have to worry about the CA as long as the payments to the credit card are timely or would this mean that they are forever out of the picture?
What are some of the pitfalls of this agreement - I have read comments about this offer by searching the forums and the only criticsm I can find is that it is stupid. If I am trying to pay off these debts why is this a stupid way to do it?
And, lastly, if I accept this offer but a credit card is not issued - ie denied - will I have restarted the SOL even though the TIME BARRED clause says it is only when the balance is transferred?
Again, I want to finish paying off all my old chargeoffs - just a personal thing I want to do - so any advice on why I should/should not accept this offer as a legitimate settlement will be appreciated. I have been reading this forum for about 8 months now and have gotten alot of good advice. So far all my PAIDS/SETTLED accounts have gone smoothly with pre and post agreement letters being received from all collectors. I realize that a paid collection is not any better than an unpaid per most on this forum - but my credit score being increased dramatically from a decreased utilization offsets that for now.

Thanks in advance for any help, suggestions, polite comments.What is the name of your state?

[Ladynred]

Isn't this as good as any settlement as long as I make my credit card payments timely and pay off the balance?

No, it's not good at all !!!

These 'new credit cards' are nasty little scams by the collection agencies to RENEW a debt that they cannot otherwise collect. You say it's beyond the SOL. If you put this debt on a new card, you are RESTARTING THE SOL and making a NEW contract, one for which they could once again sue you. If it ever goes bad, you will have a new, FRESH negative that will drag your scores into the dirt even further for ANOTHER 7 years. An OLD charge-off does less damage to your scores if you leave it alone, just let it die. If it's also close to dropping off your reports, you REALLY don't want this on your reports !

In addition, since this would be a settlement, you will have that NEGATIVE on your reports, a settlement is NOT a positive tradeline, it's bad, it hurts your scores just as badly and the existing OLD charge-off - -if not more because it will show as RECENT to the FICO scoring model.

Once the balance transfer takes place would I still have to worry about the CA as long as the payments to the credit card are timely or would this mean that they are forever out of the picture?

They won't be out of the picture until you pay it off at 100%.

will I have restarted the SOL even though the TIME BARRED clause says it is only when the balance is transferred?

No, but they're not going to turn you down, this is not an OFFER OF CREDIT, it is a way to revive an old debt that they cannot legally enforce !

[nobody]

Thanks for your response and I understand your arguments. These last 3 debts I owe have just recently reached the SOL and they will be on my reports at least 3 more years. The situation that created this mess four years ago is long over and I have taken care of the other eight chargoffs I had. I am intent on paying off ( or in this case settling) the last three debts I have.

The legal questions I have are:

Is the only amount that will become enforceable just the amount being settled for as the letter states? Will the other amount that is forgiven still be TIMEBARRED?

Also, will the collection agency have any legal grounds to sue me if I am not defaulted on the new card and make timely payments to pay off this debt? Too many horror stories of people making payments and still being sued.

Would I be better off, legally, if I just wait until I have the cash and then settle with a lump sum payment?

[Ladynred]

Is the only amount that will become enforceable just the amount being settled for as the letter states? Will the other amount that is forgiven still be TIMEBARRED?

Yes, and maybe. The amount you do NOT pay could wind up being sold to another junk debt buyer. It is also likely you will have to pay taxes on the amount you do NOT pay. If they send you a 1099-C "cancellation of debt income", that amount, if over $600, will become taxable income you will have to put on your tax return for the year.

Also, will the collection agency have any legal grounds to sue me if I am not defaulted on the new card and make timely payments to pay off this debt?

No.

Would I be better off, legally, if I just wait until I have the cash and then settle with a lump sum payment?

In my opinion, yes. This 'offer' of theirs will come with a time limit, or that's what they may try to tell you. That the 'offer' is only good NOW. That doesn't mean they won't accept a settlement offer at all, but their goal is to create a sense of urgency and get paid as much as they can get.

[dusty80]

Has anyone actually accepted this offer? Did you have any problems?
I am asking as I have received an offer identical to this, except for the amounts.
Thank you

[Ladynred]

Stay away from it. It's NOT credit, it's a way for them to put an old debt BACK on your credit reports by reviving the statute of limitations. Despite what they say, it's NOT going to be a credit builder.

Just put it in the shredder.. you don't want to be stuck in the clutches of LVNV/Resurgent!