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What wording is best on a credit report for settling a charge off credit card?

I am ready to settled a capital one credit card at appox. 50% of total debt owed. They will not agree to delete the trade line or even remove Charge off from my credit report with all three bureaus at this point. If payment in full and Paid as a Agreed are out of the question since I'm settling for $.50 on the dollar, what's the next best verbiage I should insist on? Assuming at this point, that settling is better then not paying and being sued!

laphillips

Until the charge off is paid per agreement - even the negotiated agreement - the account is considered open. After payment of the agreed upon settlement the account should be reported as paid/closed.

(Please be sure to get a copy of this negotiated agreement & have them include the fact that this will pay the account in full. Also make sure you get a statement showing you made the payment and the account is now closed.)

And yes as far as a lender is concerned seeing a paid account even one that was originally charged off is much more desirable than seeing a lien or suit on your credit report.

Guest

Interesting, they want to report is as settled for less then agreed amount or Paid "Charge Off" - so at this point, I should insist that it simply says "Paid". The account was already closed by grantor according to my credit report.

banker0679 · Posted: Wed Jul 30, 2008 9:33 pm Post subject:

Welcome to MortgageFit forum,

It depends on who holds the account....

If you're negotiating with a collection company, and it's being reported as a collection, then it doesn't matter what they word it as.

If it's the original creditor then they will more than likely put "settled for less then agreed amount". Regardless of what they put, your score will come down once it's paid. The credit bureau will view that you're acknowledging the lates on the tradeline. They seem to have a flaw in their credit score system because the way they report it is as if it was a new negative account.

Guest

Well, I need to settle this account because a suit has been filled even though I haven't been served yet. This is with the original creditor's attorneys. Its unfortunate that after making a payment, your score decreases instead of at least remaining neutral. So really, it sounds like it doesn't matter what they enter on the report, you're kinda' screwed from a scoring stand point but you avoid a suit and judgement.

banker0679 · Posted: Thu Jul 31, 2008 7:24 am Post subject:

You should find out what is the Statute of Limitations for that debt.
I'm not telling you NOT to pay it, but it will help you in the future.

Make sure you get everything in WRITING BEFORE you send them a payment. They can still send you to court after you make a payment.

If you make a payment then it restarts the statue of limitations

Guest

This account charged off 9 mos ago.

larry · Joined: 27 Jun 2007 Posts: 3322 474.67 Dollars($)

Hi Tracy.

Welcome back.

You should pay off the due debt ASAP. If you settle for this debt then it will also be mentioned on the credit report. You should send a Pay for Deletion letter. Pay them off and ask them to update this to the credit reporting agencies.

Best of luck,
Larry

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