Negotiating a Settlement with ARS National Services on Credit Card Collections
I have a friend who have a credit card debt with BofA which was charge off for the amount of $8200.00 in 2010. She tried to work it out thru Freedom Debt Relief in 2012 but was only able to pay around $1500.00. the account was then written off for the amount of $7300.00 in 12/2012. She is expecting a tax refund of $1050.00 this month and she wanted to use that to settle in full her debt with BofA (after reading various comments that you can possibly do it and settle your charge-off account in as much as 10% of the total amount). She called the number of BofA in her credit report but the person who answer her call after verifying her identity says she will have to call a debt collection agency, ARS National Services, because her account is with ARS already.
What does this mean? Can she still negotiate to settle her debt at 10% of the total amount? What should she do? Hope you can help us on this.
What to do when BofA says your charge off/written off account is with ARS National already? Can you call ARS to settle it.
—loren
ARS National Services does collect on behalf of Bank of America. In your situation they appear to be acting as a third party contingency debt collector. You can certainly call ARS to negotiate and resolve the charged off credit card debt, but I would encourage doing that when you have a more realistic amount of money to offer as settlement.
I have some questions for you to answer below that could help me offer more feedback about dealing with ARS.
Calling ARS National Services with an Offer to Pay
I am not sure where your friend was reading, but unpaid credit card bills rarely settle for 10 percent. There was a brief period of time at the height of the recent economic downturn where Bank of America was settling accounts for 15 percent of the balance owed just before charge off. Getting that kind of deal approved on a BofA charge off was not all that common then, but I saw a sprinkling. Getting that good of a settlement from ARS National now would be unexpected.
I would suggest being prepared for 30 to 40 percent as a realistic settlement target. I do still see some accounts get resolved for lower than 30 percent. And if your friend does not look all the collectable to ARS on paper (other collections not paid on credit reports, not working, etc.), there may be a shot at negotiating lower, but probably not as low as can be funded with just the tax refund.
When negotiating and settling a debt with ARS National, keep some things in focus:
- Always keep a calm and professional tone when talking with a debt collector.
- When you are on the phone with the ARS debt collector, only offer information that supports there is no ability to make monthly payments, and only limited funds to offer as a pay off (it helps when your credit reports show there are other debts owed).
- Use end of month and other negotiation strategies as a timing method to get a better outcome.
- Never agree to a payment or settlement amount that you are at all concerned you will be able to follow through with.
- Get the agreement to settle from ARS in writing.
Watch this brief video for tips about negotiating and settling with debt collectors like ARS.
What state are you in?
Can you confirm when the past payment was made on the credit card (usually 6 months before the account charged off)?
Are there other collections showing on her credit reports?
Were there prior settlement offers from ARS National Services received in the mail, and if so, when was the last offer made?
Post your answers in the comments below and I will have more to share.
If you are dealing with debt collectors from ARS, and have questions and concerns of your own, you are welcome to post in the comments below for feedback.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
And the fun begins…..reached a settle deal with Chase for 760.00 on a 2284.00 charge off on 11th of June….21st of June still hadn’t received paperwork in the mail so called them to check on when it might be in my mailbox….Only to be told it was placed with ARS on the 13th and they transferred me over to them……to be told 760.00 wouldn’t work and they wanted 1800.00…..total shady doings by both companies…get it in writing and record all phone conversations.
We are looking at possibly agreeing to a payoff amount with ARS very soon. We have multiple credit cards that we kept up with and maintained until relocating and the new job feel thru after relocation. At which point it has been more important to feed and provide shelter for our family of 6 Thus, the credit cards all went into delinquency no matter what. Unfortunately, at that point we did not have any control. I homeschool my children and reside in the state of Texas. My husband works his tail off to provide for our family unit.
To the point… as we begin looking at arrangements to try and rectify, what we can, if we agree with ARS and make a one time payment so it is done regarding a Chase account…how will this impact our credit? I don’t see them agreeing to mark on our report “paid in full” and/or removing the charge off.
From your experience and knowledge, what would be the realistic outcome from them in regards to their reporting to the credit report agencies?
Thank you in advance.
ARS National will do the settlement deal with you on behalf of Chase. Chase will be the one updating your credit report to show a resolved collection account. Instead of an r-9 you will have an r-5. It will not get any better than that, and ARS has no control over the credit reporting.
You may not want to target Chase with your available money first, as you may have more aggressive creditors. You can schedule a consult to go over where I see your situation if you like. Just fill in the “Talk to Michael” form in the right rail on this site, or call the toll free number you see to the right. I am at extension 2.
Hi Michael,
ARS no longer has the account. They told me to call Capital one to talk to them and see who has it…
You may be able to settle the debt directly with Capital One when you speak with them. They will sometimes hold an account for a short time before sending it out again or selling it.
Hello Michael,
I’m still working on the Capital One issue. My wife has a question regarding the Chase Card debt we have. When I wrote you we were not sure if Chase still had it or if they had sent it out to a collections agency. We recently received a letter from Nationwide Credit Inc. regarding the Chase account. My wife asks: should I still call Chase first as you suggested (our only income is SSI and SSDI) or should I go directly to Nationwide? You had initially recommended calling Chase so we were thinking it might be a good idea to call Chase anyway and let them know of our financial hardship as you suggested. Further thoughts or ideas? Thanks
I would call Chase about the hardship details. If you are motivated to negotiate and resolve the debt by settling for less, calling Nationwide Credit Inc., is better than calling Chase.
Hello Michael,
I had sent you a message previously but I cannot find it to save my soul. Anyway, we spoke a month or so ago about 3 credit card issues we have, one of them is mine (Capital One) and two are in my wife’s name (Chase and Citi). The Capital One card has been charged off ($730) and the last communication from a collection company was in February 2016 from ARS National Services. They sent me several letters offering two different settlement options. One for 43% and two letters offering 63% settlement at two payments. I’ve received nothing from them since February. What strategy would you suggest in moving forward to settle this? Since it is a small amount we have the ability to settle this debt. I was thinking of trying to negotiate 35 to 40 cents on the dollar and a payment schedule of 3 months or if they would lower the percentage I could suck it up and pay one lump payment and just adjust my budget for the next three months.
We are on a good budget and are very thankful that we have been able to be diligent about that and it is working pretty well for us. (Dave Ramsey Every Dollar Budget) We have a few unseen hicups so adjusting with a small amount of money is challenging. We really need more income but that is not happening presently, but hopefully for the future. We are strictly on Social Security and Disability as we both have auto-immune issues that make working full time difficult.
My wife’s cards are Citi and Chase which are the larger debt of approx $22,000. We have been unable to save for either of these cards nor have we been able to find a source to borrow from. It is at the stage of being charged off or has been recently charged off. So what would you recommend for strategy on those two cards being that we cannot presently fund a deal.
The Citi and Chase were not opened by me (Chase my wife had before we married and the other was a balance transfer) but my wife added my name for charging privileges. The Capital One card was in my name only and was originally an HSBC card that was sold to Capital One. I had very little problems with HSBC but NOTHING BUT PROBLEMS WITH CAPITAL ONE from the get go. Thank you in advance.
Capital One accounts are not often negotiated below 40 percent. Getting ARS National to go lower than that is going to be a stretch.
Those settlement offers you got in the mail from ARS are probably expired, so you would have to call and see if you can get them to the same deal, or close to it. But don’t be surprised if ARS National does not have your accounts any longer. Debts can change hands frequently from one agency to the next. The fresher the charge off the more likely the debt moves around every few months.
Call and find out if ARS still has the account. Let me know if they do.
I would not engage in any dialogue with Citibank at this time. You have nothing productive to talk about until your finances mend.
I would call Chase and talk to them about being on a fixed SSI and disability income. They are good about flagging your file and it could impact the collection track you end up on with Chase. I have seen them out right forgive debt when they know there is no shot of being paid back.
I have received a settlement letter from ARS (chase acct. one year old) I am going to take the offer but was wondering do I dare pay thru their payment portal or should I send a money order?? It’s 2 payments.
There is little concern with paying a legitimate debt collector using their online portal or with a check by phone. Nowadays these methods are preferred, and money orders are something I warn against using.
Thank you!
That makes me feel a little bit better!!!
If you make the payoff online do they send a mail confirmation or just process the payment with online confirmation?
You can print out any confirmation you get from the transaction, or take a screen shot. It really does not matter that much when you have your own bank records to point to the fact you paid… if you ever need to.
What is most important if you are paying a negotiated settlement with ARS National is that you have that agreement in writing before making a payment.
Hello. I live in Oregon and I just received a letter from a debt collector (ARS) trying to collect a $493 debt with a date of service 12/22/06 in Rhode Island. I cleaned up my credit in 2010 and will finally have the last couple negative marks hitting 7 years and coming off this year so I am nervous about this letter because I do not want this older debt to get added, especially as I am finally about to graduate from college, have two kids, and want to buy a house as soon as possible.
I looked through my files and found the original bills, and with them I found an original debt collection notice from the same company (ARS) addressed to when I still lived in RI and dated May 18, 2007. So I assume the date of original delinquency would have to had been before May 2007. I then also received another notice again from ARS in Sept. 2007. The May notice threatened action after 30 days, and the Sept. notice threatened action after 10 days, however no action was ever taken, they never reported it to my credit report, and I have not received another bill from them up until this point (which I assume is because I just opened my first credit card last Fall).
I am pretty sure RI SOL for debt collection contracts and open accounts is 10 years. So it has been about 8 years now. This is over the 7.5 year limit that the account could remain on my credit report if it were to be put there (i think), but I am unsure what to do. I am still within the 30 day period to dispute the debt (I have not yet responded) but I am unsure if I should do this, if I should ignore the letter, or if I should pay in full?
Some guidance?
oh, and the debt is a hospital medical bill, which I am pretty sure is considered an open account?
One off bills are generally considered written. This typically would include a bill from a visit to a hospital or medical service provider.
Accounts with balances that can go up and down month to month based on payments and new charges are generally considered open ended.
Michael,
Thank you so much for all your help. I do have one last question. Where do you see Rhode Island SOL is 5 years? Can you direct me to a site or document? I am just curious because everything I’m finding when I google RI SOL says 10 years.
And if its 10 years then ARS is still within statute of limitations to sue me but they cannot report the debt on my credit, correct? So what do you suggest would my best course of action?
I corrected the RI SOL comment above to read the right time frame.
The SOL is passed in Oregon. If you are a resident there (work, live, drivers license, etc), they will not sue. If they do, your defense is quick and simple – the debt is time barred.
They are not going to sue in Rhode Island as they sent the letter to your address in Oregon, so know that you live there.
I see your options the same. Send the cease communication letter, or ignore it.
I moved your comment to this page dedicated to collection accounts with ARS.
Rhode Island SOL is 10 years, and Oregon is 6. You are well passed the limit to be sued for the underlying medical debt that ARS is trying to collect on as an Oregon resident.
Because the account is also too old to appear on your credit reports, I would send a written dispute letter that includes a request for them to cease communications too.
When legitimate debt collectors like ARS receive a cease communication letter they stop contacting you. I do not recommend sending a letter that limits debt collectors to only suing in court until the time has expired for them to legitimately do so.
Send any letter like this using certified mail return receipt requested. Save a copy of the letter you send too.
You could also just ignore the collection letter from ARS. If you get additional collection notices they could go in the round file too.
This ARS account should never show up on your credit reports now. If it does show up later on, post an update and lets go from there.