Are there advantages to settling an account once it's charged off, R?

Question

If one had an unsecured credit debt, that has been charged off, is there any advantage to settling with an agency? That is, it was listed as an R9 charge-off on the credit report, for around 2K, and another around 6K, but with separate agencies. They say this is the last month, then it could go to an attorney, where you have no negoitable rights, that is they wouldn't settle for anything less. What if you have no property of any kind to protect, and you really can't pay a lump sum, but can only over small payments? Why pay it off, if it still says R9 on the credit report? Sounds like no real deal?

The state in question is Connecticut, so not sure if they allow bank account attachment.
In regarde to statute of limitations, the last time the account was in good standing was about Dec/Jan of 06'-07'
The other item, the collection agency stated, once it's payed off with them, I get a letter from them stating so, and it was up to me, to send it to a credit bureau...of course they are telling me this from Virginia.

Answer 1

Well first how old is the debt. If you are still in the Statute of Limitations they can file suit against you. If they win a judgement against you they can garnish your wages(if your state allows it), or attach your bank accounts. In this case you will not only have the Charge-Off but a judgement listed on your credit report.

If you are outside of the SOL they can do nothing legally to get you to pay. The only thing that will happen at this point is that the negative information remains on your report for 7 years from the date of the first delinquency. If you are not going to need any credit and can wait this period out then there is really no advantage to paying.

Now, if you need to get credit or are still in the SOL and want to take care of it. The best thing to do in this case is send them an offer in writting that you will pay off the account if they remove the collection account. In the letter be sure to include the amount and number of payments, the dates of the payments, and that they will remove the negative information once you pay it off. Do not send them any money until you have an agreement from them in writting.

Answer 2

IRS regulations prohibit an agency from further collections on accounts that have been charged of as bad debt!
They simply sell the debt to a collection agency and then they (the credit agency) will re-date the loan and try to collect.
Your best bet is to contact the original creditor and inform them that you will pay off the balance in monthly payments and that they cannot legally add interest.
Once it is paid, it will show as paid/charge off on your credit report but it won't be as bad as just being shown as a charged off debt.
Remember this, if the original debt is past the SOL date and you make any kind of payment to a credit collector then the date of the debt is re-set and will remain on your records as though it was a recent debt.

Answer 3

It looks like the SOL is 3 years which means you are still within the time frame to be sued.

Collection agencies don't want small payments over long periods. More are actually going to court over smaller amounts. So you may get sued. If they garnish your wages, they could get 25%. If you offer payments, make them bigger than what could be garnished.

You might be able to get them to settle for half but the payments plan will have to be for a shorter period.

Be sure to get any settlement agreement in writing before paying and do not give them access to your bank account.

Answer 4

nooooo
what law says you have to pay a Collection Agency?
is it past the statute of limitations, did you sign a contract
with the Collection Agency that you owe THEM the money,

creditinfocenter com
buddhibbs com

Answer 5

"charge off" refers to the status of the account on the creditors books. It has nothing to do with whether or not you own the money or have to pay the debt.