From 720 to sub 500 Fico

For just about anything you want to get off your chest about credit cards.
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dima202
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From 720 to sub 500 Fico

Postby dima202 » Sat Apr 13, 2013 1:08 pm

So I went broke for about 4 months and could not pay any credit card company.
My Fico score dropped 200 points and Chase closed my account for non-payment.

I am a college student full time and also work part-time, but I had to pay for college as my first priority.
I did get a loan to help me with my credit problem but it took 3 months to receive it.

Now, Chase was the only company who decided to close my account and that was very unfortunate as I was hoping to pay it out in full and put some of my other cards on it with low apr until I got back on my feet.
Chase was my biggest account at over $6,000 owed.

I called them and they are offering to settle @ 80% of account balance.

I only have $8,000 to spread across all my accounts from the loan and work checks.
Should I pay out my other cards and forget about Chase until they are willing to settle for like 10% of balance? Since they already closed the account and are trying to settle...

What can I do to try and make the best out of a bad situation?

Thanks for any helpful tips you may provide! :)

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cashback
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Postby cashback » Sat Apr 13, 2013 1:26 pm

Soooo rack up $6,000 in charges and hope the Chase will let you pay $600? Don't you feel obligated to pay your debts? You got yourself into this mess by carrying a $6K balance. Do the right thing and set up a payment plan and pay your debts!
Credit Cards
Amex BCE 25K ---- PenFed Platinum Rewards 15.5K --- US Bank Cash+ 12K --- Discover IT 6K --- Citi Dividend 5K --- Chase Freedom 12.5K --- Amex SPG 6K --- Citi Thank You Preferred 15K

Not Used
Citi Simplicity - 5K, Sam's Club Discover - 10K

Future Cards
Sallie Mae World Mastercard

FICOs
Exp 772 - TU 781 - Equ 781

dima202
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Postby dima202 » Sat Apr 13, 2013 1:51 pm

Yeah, I want to pay them, but I also need to be sure that I get a good payment plan and pay them as little as possible due to my current financial situation.

The 10% thing is a worst case scenario.

Are there any tips for something I can tell chase to go easy on me? To get a good payment plan. To not get charged the crazy interest rates?

I have never been in this kind of situation before. Posting here is a last resort, to get any information I can use to get the upper hand to resolve the issue in the best way possible.

selfmadetool
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Postby selfmadetool » Sat Apr 13, 2013 2:07 pm

dima202 wrote:Should I pay out my other cards and forget about Chase until they are willing to settle for like 10% of balance? Since they already closed the account and are trying to settle...

What can I do to try and make the best out of a bad situation?


It's too late to suggest that you at least pay the minimum. Understand that Chase was the only company who decided to close your account right now. I would go ahead and zero out the other cards you have. They may very well balance chase you or close your accounts, but at least you can always send them a goodwill letter in the future after you square things away with them financially.

With the amount of cards offered by Chase, I doubt that's a relationship you simply want to throw away. Considering you may need a clean report to get a job after you graduate, it may be beneficial to deal with this issue sooner rather than later, especially when interest is added on. Good luck!
Bank of America: BankAmericard Cash Rewards ($10k); Accelerated Cash Rewards ($12k)
Chase: Freedom ($2.6k); Amazon.com Rewards ($5k)
American Express: Blue Card Everyday ($14k)
Citibank: Forward ($7k); ThankYou ($10.5k)
Discover: More ($14.5k)
Barclaycard US: Barclaycard Ring ($9.4k)
GECRB: Banana Republic ($4.5k); Amazon.com Store Card ($10k)
Comenity: J. Crew ($3.6k)

dima202
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Postby dima202 » Sat Apr 13, 2013 5:10 pm

I called Chase and they offered me:

Settlement (Which would badly affect my credit score for the next 7 years) $3,500

or

Balance Liquidation Program (BLP) at 6% interest of 5 years and $120 monthly payments. Which is 1.2% Interest Rate annually which comes out to under $75 a year of interest which is a very good deal.

Hope this helps someone in my situation as well.

Thank you for your responses and helping me make a decision.

MemberSince99
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Postby MemberSince99 » Sat Apr 13, 2013 6:50 pm

First of all why judge the guy? I think most of us have been in the same boat he's in. I'm not going to sit there and call him a criminal when I personally burned Chase for even more than he did. Does no good what's done is done.

As far as Chase goes, yeah try and keep your other accounts open. They MAY forgive you many years down the road (figure at least 10 years) and let you back in, but don't bother app'ing for any Chase cards for a while. And they WILL turn your account over to the nastiest collection agencies you can imagine if you don't work something out with them and these people WILL hound you and WILL sue you. It may take them years to get around to you but they have years to work with. They won't just forget you. They won't play the waiting game with you either, they will after 6 months write it off and turn it over to the vultures.

You can hide like I did, but if you get careless and put your real address on that background check form for a job, boom they've got your address expect to hear from them.

It's a tough game to play and one you probably won't much enjoy and in the end, will turn out not to be worth the money, literally. So see if you can't work something out with them to avoid this. If you can't, you can't, but don't just let it sit, or you will have to live with paranoia until the statute of limitations in your state is up.

cashback
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Postby cashback » Sat Apr 13, 2013 7:01 pm

MemberSince99 wrote:First of all why judge the guy? I think most of us have been in the same boat he's in.


I don't think most people rack up CC debt they cant afford and think its okay to pay back pennies on the dollar, if any at all. He is being judged because he decided to put his story out on a public forum. He acted irresponsible and now he should work to pay back every cent he owes. That's the problem with everyone these days. They mess up and then they expect to be forgiven.

OP is getting exactly what he deserves. He shouldn't be given any credit for a long time.
Credit Cards
Amex BCE 25K ---- PenFed Platinum Rewards 15.5K --- US Bank Cash+ 12K --- Discover IT 6K --- Citi Dividend 5K --- Chase Freedom 12.5K --- Amex SPG 6K --- Citi Thank You Preferred 15K

Not Used
Citi Simplicity - 5K, Sam's Club Discover - 10K

Future Cards
Sallie Mae World Mastercard

FICOs
Exp 772 - TU 781 - Equ 781

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Snowman
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Postby Snowman » Sat Apr 13, 2013 7:20 pm

Cashback, I totally agree with your post. We take no responsibility for our actions anymore (this is how saddening it has become). 99, you too are also right, these people will come after you until you pay up or the SOL is up, and even they can decide to re-age it, and soon again they will want their money back.

OP- Please do your best to square yourself financially with Chase and any other creditor you have, I understand you are in a tough position, but these people are not your friends who will forgive you quickly. As you are learning, the credit world is often very unforgiving.
Bank Of America: BankAmeriCard Cash Rewards-4.2k
Citi: Forward-4.5k American Airlines Advantage Platinum Select World Elite MasterCard 9/6/15-4K
Discover: More-7k
Amex BCE.2k- Amex SPG-5k
Chase: Freedom-5kSouthwest Rapid Rewards Plus- 3.6k
Capital one: Venture one-10,000, Visa Signature.

AMEXPlatino86
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Postby AMEXPlatino86 » Sat Apr 13, 2013 7:33 pm

How you spread out the payments really depends on the amounts of the other debt. You said that the highest you had was 6,000 with Chase. What are the other ones? But like everyone else said it's just best that you call all the creditors and settle this matter before it gets any worse.
Wells Fargo Platinum 2.100 (5/2011-cld 7/12/14)
AmEx Platinum (6/12)
Barclays Apple (6/12)
AMEX Gold Delta (5/13)
Marriott Rewards (7/14)

My credit score :cool:
EQ: unknown
EX: 762
TU: 752

DavidNY
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Postby DavidNY » Sat Apr 13, 2013 7:44 pm

The CARD Act prohibits "universal default" so other cards may still be OK as long as you pay the minimums.

I would recommend calling up Chase and setting up a payment plan that will allow to to keep your card (if at all possible), but don't expect them to take 10% of the balance and call it even.



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