My $900 bank account will be sent to collections, according to a call from Chase. What should I do?
To pay or not to pay? 
Right now, there are really just two choices available.
How can I let it go?
To what extent are collections lacking?
Am I able to bargain?
You have two options: pay the debt or let it go to collections. Collections can stay on your credit report for seven years, but the tricky part is if the collection agency sells your debt to another agency, that seven-year period restarts. Even if you’re just one day away from the seven-year mark, if they sell it, the clock resets. Depending on the type of debt and the amount, you might be able to wait it out for the next seven years without paying it.
From my experience, I had a $2,800 credit line with Best Buy, and PRA Associates went after me for it. It took four years, and I’m pretty sure they bought the debt recently. I responded to their summons using a guide from SoloSuit and ended up paying less than they initially asked for. I also have a Wells Fargo debt—each time they reach out, the settlement offer gets lower, so I’m just waiting it out. If they do decide to go legal and I get a summons, I’ll just respond with the last offer they gave me, or a lower one if available.
Keep in mind that debt collection agencies probably bought your debt for pennies on the dollar, so paying them a high amount is just them making a profit. That’s why I always aim for a lower settlement and never pay the full amount they ask for.
Yes, but they terrify you because the collections figure continues going up.
How can the amount in collections go up? I’ve never had a notice with a higher amount than my original debt. Personally, I won’t pay more than what I originally owe. Have they sent you any documentation stating when they’ll send it to collections if you don’t make a payment? Sometimes, they try to scare you, but you only feel that pressure if you let it get to you. How long have they been threatening collections? In my experience, it usually takes quite a while after the first “threat” before it actually goes to collections.
Here’s something that might help: I once got stuck in a borrowing loop with Amscot. It got to a point where I quit my job and couldn’t pay them back. So, I walked in and said, “I’m sorry, what are my options?” The lady told me, “Even if you gave us $2 today, we’d accept it, and your balance would just go down by $2. It’s when you don’t show up at all that it starts to hurt you.” I paid $10 a week for a while just to stay on track. Sometimes, simply asking for leniency can keep you in good standing.
Not to throw myself under the bus, but I was young and reckless at 19. I maxed out 8 or 9 credit lines, each for $2-3K, and defaulted on them less than two years later. So far, only one creditor has come after me, and I’m 26 now. I can’t say exactly how long my accounts have been in collections, but it’s been almost five years at this point. Everyone’s situation is different some people get pursued by collection agencies more aggressively than others.
You’re verifying the account? I haven’t heard of that; you must be referring to CC.
My checking account went overdrawn and I now owe $900 because I misplaced my phone and someone stole $3,000.
You ought to pay it if you have the means to do so. Find out if they’ll accept less money. In order to avoid the trouble of submitting it to a collection agency, some clients may take that action.
Ask about making payments and whether doing so will prevent it from going to a collection agency if you are unable to pay the entire amount at once.
Indeed, interest will likely raise the amount you owe if it goes to collectors. They might also choose to sue you, in which case interest would be compounded with court expenses and attorney fees.