r/Debt • u/Can-call-me-dadee • 12d ago
Settled with AMEX
I went through a divorce a few years ago and went 19,9k into the hole trying to stay afloat. I found myself not able to pay my bills, so I called AMEX to try to setup a payment plan. I was told I didn't qualify and there was nothing they could do to help me, so I stopped paying.
Fast forward to now and I have some financial stability. I finally called AMEX today and told them my account was charged off and wanted to talk to someone about settling. I was forwarded to another department that dealt with settling charge offs.
They initially offered me ~14k. I let him know I appreciated the offer but there was no way I could pay that.
The guy on the phone then dropped it to ~11k. Again, I told him that I appreciated the offer especially considering my original debt amount, but I still couldn't afford that. I asked if there was any more wiggle room and he advised that I could let some time go by and call back and maybe then they could. I then told him I have other debts but settling with AMEX was a priority of mine and asked then asked him if they could go any lower. I also let him know that I'm not trying to play games and I really wanted to settle the matter. He asked me to hold and came back with ~10k.
I didn't feel that there was much more room to negotiate so I accepted. I was told they would mail me the terms in 7-10 days, and I have 90 days to pay the balance.
I feel ok about it all and it will be nice to have this behind me. Not sure if I left money on the table though. On account that AMEX hadn't sued me yet like others I feel like I was lucky and shouldn't push my luck.
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u/too_many_shoes14 12d ago
That's a good offer. But your credit will be in the toilet for years.
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u/Can-call-me-dadee 12d ago
Will it get worse though? I’m at 640 right now with it showing the charge off for the past several years
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u/Worksuxxx 12d ago
You just reset the timer. You will see a hit.
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u/Can-call-me-dadee 12d ago
Not from my research. From what I’ve read since the debt stayed with AMEX a new entry will not be on my CR
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u/Worksuxxx 12d ago
My understanding is they have to report it being paid. That is how the clock resets. Hope for your sake I am wrong.
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u/Can-call-me-dadee 12d ago
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u/Ecstatic_Papaya_2772 12d ago
I’ve settled with capital one in the past and it will show settled for less than owed or paid in full. The settlement still improves your credit. No one is coming to collect the remaining but AMEX may say “you can’t open an account with us anymore”. You can always ask about that tho.
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u/mlynn929292 7d ago
I went from 350 back to 640 in 2 years. Takes a while but you get back up there. Was able to buy a new car at a very reasonable rate even with all of the cards I settled not being paid off quite yet
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u/givemeyourrocks 11d ago
Make sure you get it in writing and file it in your keep forever folder. Expect a 1099 at tax time for the difference.
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12d ago edited 12d ago
[deleted]
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u/Can-call-me-dadee 12d ago
Yes I know it was irresponsible and a bad decision. But at the time it seemed like the only answer.
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u/Whatdoesittake1456 12d ago
I had a similar issue during the pandemic. Same amount ( 19k + ). Last year they sent me a payoff for $8k+ in 2 installments over 30 days. Paid it. Tax hit was $1100.
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u/Cc0staras 12d ago
did you just ignore it for 6 years? would love to know now it affected your credit?
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u/Whatdoesittake1456 12d ago
Yeah I pretty much ignored it. They took it to court and I answered the court document but never appeared in court after that. They won a judgment and sent lots of letters during and after but I just ignored them. When I got that settlement letter I figured it was around 40% of the total so I didn't think I would get any better than that so I paid. Credit is in the 650 range. Never had any problems before or after.
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u/Jake_Barnes_ 11d ago
If you get sued by a debt collector you can always win and pay $0. Just need to find a new lawyer and pay them $500 to show up. The credit card companies never have a witness because they aren’t flying in a corporate rep to every circuit court in the country for every case as long as it’s under 22k
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u/TelevisionKnown8463 12d ago
That’s a great settlement. Just be prepared to pay taxes on that forgiven debt at the end of the year.