Last week, I called Synchrony Bank, and they offered to settle my $1.2k debt for around $400 since I was 120 days late. This felt like a huge relief, as I could clear it for way less.
Now I’m wondering if I could try the same thing with my Capital One card. I owe $2k there, but I’m not behind on payments. Think it’s worth asking?
Is $1.2k worth tanking your credit score?
Jai said:
Is $1.2k worth tanking your credit score?
That’s a big amount for me.
And my credit score is already low.
Jai said:
Is $1.2k worth tanking your credit score?
That’s a big amount for me.
And my credit score is already low.
Why not set up a payment plan or transfer the balance to a 0% APR card for 12 months, and avoid using credit cards until you’ve got better control over spending?
@Jai
Because settling saved me $800!
Sure, but now your credit score is affected for about seven years. If you’d gone with a payment plan, you could’ve improved your score. And it’s not just about big purchases… some employers check credit scores too.
Plus, if you settle, some people have horror stories of the company coming back years later to sue. Is $800 really worth the risk?
@Jai
That $800 is a lot to me. Why would they sue if we settled? And my score is already around 500, so it’s not like I’m ruining good credit.
Mal said:
@Jai
That $800 is a lot to me. Why would they sue if we settled? And my score is already around 500, so it’s not like I’m ruining good credit.
Just because one bank lets you settle doesn’t mean skipping out on debt is okay. You spent that money, so you’re still responsible for it.
Go for it! That’s a decent offer… just don’t expect all your other cards to settle the same way. Some only offer 50%, and after adding fees and interest, it’s like paying double in six months. If you’re getting a deal for 33%, take it! Just make sure it’s in writing, and pay with a check for proof. They can’t resell it later if you’ve settled ‘in full.’
And no, settling doesn’t kill your credit score. It actually looks better than if it goes to collections.
Capital One probably won’t settle with you if you’re up to date on payments. That $800 savings now could end up costing you more in the long run with higher interest rates on future loans. Even after a few years, those charge-offs will still show on your credit report.
You might want to think about whether saving now is worth the impact on future costs like car loans, mortgages, etc.
I’m in the same boat with Synchrony Bank, and I’m going to try settling too. I doubt they’ll come back to sue if we’ve already settled. For some, $800 doesn’t mean much, but if you don’t have it, you just don’t have it. I understand why you’re going this route.
I’m $40k in debt and thinking of calling to settle so I can save some cash. I’ve got $20k saved up and was hoping to see if they’d settle for that. Already own a home and have a short commute, so it might be worth a try.