Can I settle my credit card debt with Navy Federal Credit Union for half?
I have approx $27,000 in unsecured credit card debt with navy federal credit union. I work in real estate and thus have extreme swings. I also have $45,000 in student loans which I have learned are not able to be settled or discharged in bankrutpcy. My question is can I settle my navy federal debt for 50%? I have read the credit union in general and Navy Federal in particular is very difficult to work with. Please advise?
Can i settle debt with navy federal credit union for 50%?
—Michael
It is true that settling with a credit union is often not the same, nor sometimes as simple, as setting credit card debt with a national bank. I am not sure what you read about Navy Federal Credit Union, but in my experience NFCU is one of the easier credit unions to work out a settlement with.
Settling Credit Cards with a Credit Union
The basics of why credit card debt settlement with a credit union can be different are:
- Credit Unions are member owned.
- Credit Unions are often smaller banks that do not approach settling debt with one policy fits all scenarios in the way that big banks like Chase, Bank of America, and Citi Bank do.
- Many credit unions do not sell off debt to debt buyers.
- Credit Unions often have established relationships with attorney debt collectors and use their services more than debt collection agencies. In other words – collectors for credit union debts are more likely to sue in order to collect.
- Credit Unions cross collateralize the different credit products they offer their members.
There are some more nuanced differences that can impact your ability to settle with a credit union, but the above list is the overall picture.
Debt Settlement with Navy Federal Credit Union
First lets establish whether you have other options than settling your NFCU credit card. I have some questions you, or anyone else dealing with NFCU, can answer with a reply in the comment section below.
How many months’ payments have you missed with Navy Fed?
Settlements on credit cards are typically not an option until you are closer to the card being charged off. Charge off is an accounting principle that credit unions must follow on unpaid loans. With credit cards the charge off most typically occurs when you reach 180 days of missing payments.
Will your budget support your ability to pay NFCU 2% of today’s credit card balance each month moving forward?
Navy Federal, like nearly all credit unions, will participate in lower monthly debt repayment plans. Some of them offer these plans direct to their members, others will only offer these lower payment options through a credit counseling agency. If your account is not yet charge off, and you can afford roughly $540.00 each month (2% of your 27k NFCU balances), you can avoid settlement and the knock on affects all together.
If your budget supports this lower credit card payment, make a free call to a certified credit counselor with established communication with Navy Federal Credit Union and learn more at 888-317-8770.
Do you have other accounts with Navy Federal?
If you have a car loan, mortgage, or insurance products through your credit union, you can face serious obstacles when trying to settle credit card debt for less than the balance owed. I pointed out in item 5 above that credit unions write contracts that cross collateralize their loan products. This essentially means that you’re on time car loan payment can be used to offset your late credit card payment, or perhaps that the car title is not released when it’s paid off because of unresolved credit card debt. There are many ways your other loan contracts with a credit union can impede your settling credit cards with the same bank. How to navigate these concerns, if they apply to you, and still settle the credit card, is likely handled best one on one, rather than trying to apply your strategy openly online.
If settling the credit card debt with NFCU makes more sense than other payment options, or bankruptcy, your target of 50% is a realistic expectation depending on the collection stage you are in. In fact, we have successfully guided our members to NFCU settlements that result in better than 50% savings. In order to provide more feedback and tips, I have some additional questions:
What state do you live in?
When did you last make a credit card payment to Navy Federal?
If you are being contacted by someone other than Navy Federal for collection, who is collecting?
Can you come up with the money to settle with NFCU today, or do you need time? If you need time, how much?
Anyone with questions about handling credit card debts with Navy Federal, or other credit unions, is welcome to post in the comments below for feedback.
If you would like to cover your situation and options on the phone you can reach me at 800-939-8357, choose option 2, or submit my consult request from and we can schedule a good time to connect on the phone by email.
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.
I have a 15K CC with Navy Federal. It’s currently at 120 days late I last paid in February 2019. I also have a checking and savings account. Can these accounts be closed if debt is charged off?
There are instances where not paying a credit card with your credit union, like Navy Federal, can cause them to draft the missed payment from your active checking. It can be a good idea to change banks if you are not able to pay your credit card.
Navy Federal is pretty good about offering hardship plans direct to their members when you are already late on a credit card payment. This could include dropping your interest rate to 0%.
If you just cannot pay, and do not pay for long enough (5 or more months), settlement for less than what you owe is a really good option. If you want help knocking down a single account like this, and want to optimize your savings, you can click the get debt help tab in the upper right and fill out your user profile and work with a negotiator.
The fee is 15% of savings, and can pay for itself is situation like this.
I have a 22k credit card debt that was charged off in 2015 through NFCU. I have not heard from them for almost a year. Will they still sue? What might be the next steps? I am in California by the way.
Is your goal to resolve the debt with Navy Federal now or in the near future?
In the future. I am worried that they will sue to settle the debt but I have not heard from them in nearly a year.
There is a risk of being sued. If that happens you end up paying more to settle in my experience. If you can be proactive with negotiating a settlement early on, you can often get a better outcome, improve your credit options, and eliminate risks.
Hello! I have a NFCU Credit card balance of 15,000, and making monthly payments of $300, with interest and purchase fee, seems like my monthly payment isn’t going anywhere, on top of that, I am also in a middle of having 4 or 5 of my other credit card and store card on debt consolidation. I need to know if I can talk to Navy Fed about either lowering my interest rate or just closing my credit card without accumulating any interest rate anymore, and still make my monthly payment? Thanks in advance!
What type of debt consolidation program are you enrolled in? If credit counseling, what prevented this account from being accepted into the DMP?
If debt settlement, why did you choose to keep this account out? What other loans or products do you have set up with Navy Federal?
I went with Financial Rescue LLC, and they told me that they don’t do Credit Union.
I only have my checking account then NFCU, nothing else.
Thanks for the response.
Not sure why they would not work on Navy Federal accounts. I always have, unless there are cross collateral issues with different loan products (there often are).
Fill in the talk to Michael form in the right column. I will see that and email you to set up a time to talk on the phone.
Michael,
It’s been 3 yrs since I paid off my NFCU credit card via debt settlement. During that time I still had a 14k personal loan and a second $4,000 personal loan outstanding. In 2014 I had put down a lump sum on the 4k loan and didn’t need to make payments until 2017. I currently owe $1,000.
The 14k personal loan has been with their in-house collections for past 3 yrs. They do not call or harass anymore, they just send me a letter every 2 months stating settlement offers, which change each time. Some are really good offers, the best was about 20 percent.
I have 2 questions. First, what may be going on with the 14k loan? Will they go to litigation since been so long? Should I keep ignoring? Second, if I make a payment on the other good $1,000 loan, will they cross collateralize it and apply to 14k loan to “start the clock” again? Or should I let that one go through the collection pipeline too? Keep in mind, I had no communication (payments, calls, etc.) with NFCU in 4 yrs. Not sure if they will go through the proper pipeline, i.e. 180 charge off, collection calls, etc., for the $1,000 loan. Or knowing my situation with the 14k loan, just discharge it…
Thanks
What state do you live in?
When did you past make a payment on the 14k loan?
Live in NJ. Last payment in 2013. charged off in 2014. Basically, by paying the 1k loan, which is no problem, am I potentially opening back up the 14k loan? I don’t not need all the phone calls, letters, etc for 1k…..
They have a total of 6 years to sue you in New Jersey. Whether they will or not I cannot know.
Are you in a position to pull together what you need to settle the 14k NFCU balance? What if they agree to accept a really low amount with several months to pay? You could take that deal and still pay the 1k on time.
With many credit unions there are cross collateral concerns. And given that, I might get creative with how I do this if I care about my credit reports bouncing back, or getting sued, in the next few years.
So if I make payments on the 1k loan and let the 14k ride out, is it possible they will cross collateralize?
Yes, that is possible. You can always call and talk to them about it. They will tell you. They will already catch it, so it is not like you are giving them anything they would not know when it happens. I would outline my hardship and continued inability to pay when speaking with them.
My husband and I bank with Navy Federal. We have about 22k in credit card debt with them, a car loan that will be paid off in May if not sooner (we only owe about $900 on it) and my husband has a personal loan through NF. I’m a stay at home parent and the primary caregiver of a small child so we live on one income.
Our credit card minimum is becoming more and more difficult to pay and the anxiety is overwhelming. I’m not sure what my first step should be. Because we have the personal loan and the car loan with NF, I am afraid that either will be affected by issues on the credit card account. We have all of our accounts with NFCU so they have moved money from checking to cover late cc payments before (which left me scrambling to pay other bills). Not paying the cc bill wouldn’t be an option then unless we moved our checking account to a different bank to avoid the cross collateralization.
Should I focus on paying the car loan off asap? Would that free the title up? We’ll be receiving a tax refund soon that would cover the remaining auto loan amount but I wasn’t sure if the title would be freed up even if we did that. This is my first car loan so I’m a novice in regards to this situation,
Thank you for any advice and help you can provide!
Fill in the talk to Michael form in the right column. I will see that and email you to set up a time to talk on the phone. T=You can also dial me direct at 800-939-8357 ext 2.
You have several moving parts with Navy Federal that you can time to lessen your concerns. I will want to know your interest rates on the Navy Federal credit card, and the loan.
I am currently have a credit card at $10,000 a checking credit line of $4000 and a car payment of $136/ month. All accounts are in perfect standing with no delinquent payments. Because of multiple debt issues I am being lead towards filing bankruptcy. What are the chances of keeping and finishing off payment of the vehicle after filing bankruptcy. The remaining car loan is $5000 and KBBV of the vehicle lists at only $1750. I currently reside in the state of Virginia
You can keep your car in Virginia when you file a chapter 7 if the value is less than 6k. If you still owe on the car loan you can reconfirm the loan and continue to may your payments, and still keep the car too.
I have a credit card with nfcu. Total debt of about 20k. I haven’t missed any payments at all, but I’m looking to put 10-12k on there and see if I can settle it like that. Do I need to have missed payments to settle that the debt?
Yes, you need to have missed many Navy Federal payments before you can reach the best settlement outcome. And you should be able to get things done for way less than that if you go about it correctly.
Are you more of the DIY type, or looking for help?
I’m more of a DIY guy but I’d like the help with the research on how to do it. Where do I find this information on how and when to settle? I’m honestly not worried about the best outcome, just the outcome that will end me credit card debt free. Do you think it could be done with 8-12k?
It can be done for less than that. Check out my article series to begin your research starting here: https://consumerrecoverynetwork.com/credit-cards-debt-settlement-why-banks-do-it/
I currently have two NFCU cc’s that I am struggling to pay with a total balance of $16k. I left my full time job in May to focus on school full time which caused me to rely heavily on my credit cards for expenses. I recently graduated and currently looking for a full time job. The interest in the card is extremely high–I believe about 22%. I have been making the minimum payments but with the interest the payment is nonexistent. What should I do? I feel like I will never be able to pay off these cards and this is the only debt that I have. Unfortunately not having a full time job is making it harder to pay more. Also, from some of the post I see mentions about settlements. Can you settle on an active account or do you need to wait until it goes to collections? Any help will be greatly appreciated.
Can you come up with about $300 a month to pay Navy Federal on a reduced interest rate debt management plan? I would want to try that before letting the accounts go delinquent in order to later settle for less.
You do typically have to wait until you are late 5 or more months in order to get the best settlement with NFCU. And dealing with third party debt collectors can indeed yield the best result.
Yes, I can pay $300/mo that’s currently about the amount I’m paying between the two cards. Do I contact them directly for the mana agent plan?
You can try to get them to lower your interest rates yourself, but that is becoming more challenging. You can call 800-939-8357 ext 1 and talk to a non profit credit counseling agency and get a monthly payment quote. If that lower amount works for you they can get you set up with the new payments to Navy Federal.
I have 18k in credit card debt with navy federal I am to the point I can’t afford the minimum payment how long will I have to be late for them to come up with a settlement and is there a chance they will sue and not come up with a settlement
6 to 7 months after your payments stop is often the ideal time to settle with Navy Federal. There are times where it is better to settle with the collection agency Navy Federal sends your account to, in order to optimize your savings.
There is a chance that you are sued for collection. But you can eliminate that by raising the money quickly to settle. How quickly can you save up, say 7k?
I get a nice lump sum on my tax returns around February
Perfect. Let me know if you need help.
Hello, I have an overdrawn savings account of $1775.00 because I fell victim to fraud and am now being held responsible for paying back the fradulent check (despite filing police reports). Anyways, I cannot pay this and I am worried that when my account goes to recovery with NFCU I still will not be able to pay. I understand that it will show up on my credit, but will I be sued? Or will I just have bad credit? Also, my husband and I have a joint account although all loans and everything are in his name and under his membership. Will my membership being closed affect his loans?
His accounts may not be affected, but he can call Navy Federal and ask about that.
Can you explain the fraud in a bit of detail? I may encourage you to file complaints with relevant agencies, and even look at other options.
I have 3 charged off accounts with NFCU from 2012. I cannot sign in to my account to make any payment. I am willing to make payment arrangement and go through what ever process you have for a second chance and hopefully remain a member. Please advise on what or who I need to talk to please.
Fill out the talk to Michael form in the right column Jay. I will see that and email you to set up a time to talk over your situation on the phone.
Hello, read through all the comments and replies regarding NFCU but couldn’t find one that was close enough to my situation.
I have about 10k on a cc, a car loan that has about a 25k balance (Worth less than I owe still), a personal loan of about $37k and a mortgage with Navy Federal.
Unfortunately, I fell into the same trap of getting that personal loan to pay off all my unsecured debt, and then about a year later started racking my cards back up (A bit over 65k total) along with a virtual stop to a large amount of overtime I was previously receiving (I work in the oilfield which was hit hard recently) and am now basically bleeding savings every month just to keep payments paid.
If I were to stop paying most of my unsecured debts and work on saving enough to start negotiating them one at a time how will this affect my car or mortgage with NFCU? Repossessing the car would get them nowhere as at auction I doubt it would go for more than 15k on a really good day, Would they either 1. refuse to settle the unsecured debt due to the car and home loan collaterals, or 2. repossess my car / go after my home due to lack of payment on unsecured debts, or 3. after settling, years down the road refuse to give me my car’s title or interfere with my home somehow?
I recently transferred all my normal banking needs to a local credit union that I have zero debt with as I was considering CH13 and read a few horror stories about frozen accounts etc etc with NFCU.
I am current on all my debts at the moment but am not sure how many more months I can keep current before I simply run out of funds and have to go delinquent regardless.
Yours is a situation that will require some strategic planning before you go late and impair your credit. Fill in the talk to Michael form in the right column. I will email you to set up a phone consult when I see it.
I have the following debts I have questions about on reasonable amounts to settle:
Navy Federal Credit Union (NFCU) closed credit card account from 3 years ago wth a balance of $16,885.95 with a payment arrangement of $300 a month with an interest rate 8% until 03/2017. I have 2 car loans which are in good standings which I just got back in good statust. Should I ask NFCU to settle this debt and see what they’ll offer?
Miltary Star Card which has been charged off to a Collection Agency for $7698.54 with an interest rate of 18.24% and the orignal balance was $6467.74. What is reasonable amount to try to settle this debt for with Army and Air Force Exchange Services (AAFES)?
Two closed USAA credit cards from 3 years ago with the following balances:
AMEX: $8,422.66 with a payment arrangement of $67.00 a month with an interest rate of 8% until 04/2017 (Final arrangement)
MC: $5,640.84 with a payment arrangement of $67.00 a month with an interest rate of 8% until 04/2017 (Final arrangement)
Is it possible to settle with USAA Bank Services because I have other products and services with them.
IRS owed taxes $5,903.82 from 2014. I seem to never able to get a hold of the right people about this balance within the IRS. Long wait times and many menus with resoution. Is possible to settle with the IRS, if I ever get a hold of anyone?
You can settle Military Star cards like you can NFCU and USAA Credit cards. I woudl target between 30 and 40 percent.
With the different accounts you have with Navy Fed and USAA, and the payment plans you are on that are going to expire, settlements may be better if you stagger them a bit.
Fill in the talk to Michael form in the right column and when I get that I will email you to set up a time to go over your situation on the phone.
Sir, I have five accounts with Navy Federal. I have a checking/savings, credit card account, as well as 3 savings accounts for all three of my kids. I was harassed monthly by them from 2009 until February or so of this year. Being active duty and it showing on my credit report, I then security issues and could not perform my job. I have been locked out of my accounts for years unable to even login to make payments. I had to call to set up any kind of payment and that was after I was told it was written off. They shut off the credit card years ago which was no problem. I was told there was a class action suit against Navy Federal yesterday but of course, there was no information on who to contact to find out information on the issue. Might you have any points of contact because there is of course, no mention of any of this on Navy Federal’s website? As of now, I still cannot log into the accounts and have a monthly payment set up to settle the credit card account.
Navy Federal settled a CFPB investigation into bad practices at the bank. Some of which may apply to you. I would contact the CFPB directly about your Navy Federal complaint.
I had a cc with navy federal back in 2009. I didn’t pay it and it hit my credit and is now gone from my credit. I logged into my neck account and it is showing the balance still and a payment due 10/25/16. Again this card is not on my credit report not even as delinquent or collections. I want to open a new nfcu checking account should I ask them to clear the balance since it has already hit my credit report and is off my report now? What are my options?
It may not matter about the credit reports. It can be hard to open up a new checking account at a bank where you have unpaid collections accounts. That can even be the case if you have an open account you are using now.
Do you have a checking or savings account with Navy Federal now that you are using? Any other type of financial products?
Have you asked Navy Fed about your options with a checking account?
Mr Bovee,
I had 2 CC with Navy Fed
$1,500
$1,154
They have been sent to collections but have fallen off my credit report. I would like to get my checking account back with Navy Federal. But they said I would have to contact the debt collectors. Should I pay or not. It is past statute of limitations now for me. Thanks
Are you sure Navy Federal will let you open up another checking account if you pay those old credit cards? Did Navy Federal say they sold the debt, or that they still own both? What is the name of the debt collector they gave you?
Good morning,
I had 4 accounts with NFCU
LOC Balance 1,559.00
Line of Credit Balance 2,069.00
NFCU Visa Rewards Card Balance 6,403.00
NFCU Visa Rewards Card (Joint Holder) Balance 1,019.00
My husband and I separated 2 years ago and I couldn’t afford those accounts so I just stopped paying on them. I recently decided to try to clean up my credit. I made an agreement with NFCU to pay on the Line of Credit with the Balance of 1,559.00. The settlement amount is 935.40 I don’t know if I am getting the best deal for myself. Any suggestions would be greatly appreciated
You are leaving money on the table. You can typically settle with Navy Federal Credit Union for better outcomes. Fill out the talk to Michael form in the right column on this page. I will be able to coordinate with you through email in order to connect on the phone. Once I understand your finances a bit better, I can give you better feedback.