I’ve been paying a small amount of money each month

Here’s the back ground to this story… I’ve been paying a small amount of money each month (for the past couple of years) through a collection agency for a credit card balance I have out standing.

The other week the agency phones me and tells my that I have been offered a certain amount to pay off in one shot if I can.

I check and see and report back stating that I can’t afford to pay off the amount but will bump up the amount I am currently paying.

The last conversation that I had with the agency they tell me that, that deal that they offered me was the only option I have an now its out of there hands and I may go to court.

Here’s the thing… why didn’t they mention this 6 months ago at least when I sent the last batch of checks that this may happen and that I will have to come up with a settlement?? Even in the conversation’s I had prior to this about the last deal he didn’t say anything that I absolutely had to pay this off in one shot.

At the moment I’m trying to put together the alloted amount. but will I be to late…

Question is, is there not another option… Can I not bump up the amount payed to the credit card or am I totally screwed.

can anyone share some light on this?

It is a weird thing, but it isn’t very good to have them close an account

It is a weird thing, but it isn’t very good to have them close an account. Believe it or not, it is a strike against your credit score. Moreover, it is a strike when a creditor reviews your credit report to evaluate your dti ratio. I was shocked when I learned that ANY closed accounts was a no-no. It is actually better to make a very small charge ( say once every 6 months) and then pay it directly via a check when you get home or at least that week!

I would say, to write into the credit report agencies and request a statement be added to your file to support the closing of the Credit card. Just so the financial world knows that your an informed woman and you care about your credit report. Its a dispute..but not really It is more an addendum to the closing( on your behalf).

If you choose to close any account, rather than having the creditor close it, put an addition on your credit report that states “This account was closed at the customer’s request.” It means that it was your choice, not a negative action taken by a creditor.

Still, it is not good to close accounts, esp. long open ones. The age of your credit history is important too. If you go out and open an account for that day’s discount at a store, go home, pay it off and cancel the card right away, it is not a bad thing. Not smart to open a new credit card for 10% off of a purchase, just to charge it on a 26-30% interest store card, but that is a different discussion for another time.

That’s right it’s a blessing in disguise. THEY want you to keep using the card hoping you’ll max it out & owe them your life!!! Sometimes when you haven’t used a card in awhile they automatically close it. I’ve heard they do it because there’s no profit in an inactive credit card.

You won’t hurt your credit by consolidating. Just leave the accounts open if they aren’t already closed. (if you’re looking to keep your credit score as high as possible.)

Consolidation Loans

I’m wondering if anyone can help. My partner and I are investigating the possibility of a debt consolidation loan (personal loan, whatever you might call it) to get out from under a few things that have added up. My fear is ruining our credit. Is it possible to borrow for ‘debt consolidation’ without it impacting our credit? Has anyone done this and/or does anyone have any recommendations? Thanks in advance!

Yes, you can borrow for debt consolidation without it impacting your credit rating. However, there are a couple of things to watch out for.

First- (and this might sound crazy..) do not close any credit lines! Keep them open, but do not carry a balance. Why? Because 30% of your credit score is based upon how much credit you have available to you. If you close an account, it is less credit that is available to you, and will contribute to lowering your score. Keep your credit cards open but don’t use them if they are a problem for you!

Second- Go visit a credit union! They are usually more inclined to help than a bank, and their interest rates a far better than finance companies! Try to visit a federally insured credit union. You can tell if a credit union is federally insured because the word Federal is in their name, and they have the NCUA logo on their advertising material. Federally insured credit unions cannot, by statute, charge an interest rate of more than 18%. This is far better than some places that charge twice that!

I tried to keep credit cards with no balance and the other day one of them sent me a notice saying that because I hadn’t used my card for a while THEY were closing my account. I tried calling them but they had already closed it. I was not very happy to say the least. Why would paying your bills hurt you? If you are getting a loan to pay off debts, but don’t close the cards (credit cards, I am thinking of here), and don’t use it as an excuse to go out and run up debt on the cards again, you should come out ahead.

Hope that this helps. Good Luck!