Your Options with a Repayment Plan or Settling Your Citibank Account
Have a debt of approximately $17k with Citibank Credit Card, 162 days past due. I've talked to them repeatedly about inability to pay, even offered settlements, but they won't budge. An offer they made of a 5 year 0% plan has been taken off the table, and I can't afford $1000 to bring the account current for 1 month's time. They tell me it will soon be in "pre-litigation". My question is: What does pre-litigation mean, and what can I expect next? They say making a payment of $500 will open up other options again, but I'm supposing it will just "reset the clock" so to speak, and I'll just be out the $5oo (which I probably can't afford anyway)!
What does citibank mean by prelitigation and what are my options to settle my credit card with them?
—Scott
Short answer
A pre-litigation reference from Citibank can mean nothing of consequence, or it can mean your account has been flagged for placement with an attorney who may be authorized to sue. Creditors use the phrase as an effective tool to get a payment out of you, but some accounts really are selected for immediate legal action.
Key points on this page
- At charge off, Citi does one of three things: assign the debt to a collection agency, sell it to a debt buyer such as Unifund, Portfolio Recovery, LVNV or Midland, or send it straight to an attorney collector in your state with authorization to sue.
- You will know whether the pre-litigation wording was a collection ploy as soon as you see who the account was placed with.
- Accounts get fast tracked for legal collection for reasons such as recent cash advances, balance transfers or large transactions just before default, sending a canned letter pulled off a website, paying other cards but not Citi, and even the affluence of your zip code.
- If Citi withdraws a long term repayment plan, a nonprofit credit counseling agency can often get a similar plan approved, usually with a lower interest rate and across all of your cards at once.
- Do not enroll in a repayment plan you are skeptical you can pay every month for the full term.
- If there is no realistic source of funds to settle, look at your options with bankruptcy. It is often better to be in court on your terms, with your own attorney, than on Citi’s terms with a collection lawsuit.
The reference to pre-litigation at this stage of default with a citi bank credit card or personal loan can mean nothing of consequence, or that your account has been, or soon will be, flagged for placement with an attorney who may be authorized to sue you in their effort to collect. If your goal is settling your citibank credit card, you may end up doing that with a debt collector Citi sends the account to, even an attorney debt collection firm. If you wanted to get Citi to accept a payment plan instead, even though they pulled the option off the table, you can still get on a payment plan.
Citibank, Charged Off Credit Card Debt, and the Risk of a Collection Lawsuit
Your account is a couple of weeks from charge off. When the account charges off citibank will do one of three things:
- Assign your debt out to a debt collection agency who will call and write to you on behalf of Citibank in order to collect.
- Sell your debt to a debt buyer like Unifund, Porfolio Recovery Associates, LVNV, Midland Finding etc. These debt buyers use debt collection agencies and attorney debt collectors too.
- Citibank may send your account directly to an attorney debt collector they have an established relationship with in your state for collection and authorization to sue.
Here is a quick read about what banks (not just Citi), do at the point of credit card debt charge off: Assign, Sue, or Sell.
Creditors like Citi bank use the reference to pre-litigation as an effective tool to get you to agree to make a payment. The detail you provided supports exactly that. Having said that, there are a number of accounts that are selected for immediate legal collection action. What you further outlined about Citibank withdrawing the hardship plan offer and that they are not willing to discuss debt settlement, gives me the impression that your account may well be set for fast track referral to an attorney debt collector.
There are Reasons Citi Will Fast Track Debt Collection Efforts
- It may have something to do with account activity leading up to your default in payment (recent cash advances, balance transfers, increased or large transactions just prior to default).
- If you send some canned letter you pulled off a website, Citibank may have flagged your account for legal review.
- What can be seen real time on your credit report, and whether you are paying other credit cards, but not paying Citi.
- Even the affluence of your zip code.
There are some key things I like to see people put in play prior to reaching the stage of pre charge off collection that you are in. Some prepping can help you better know why Citibank might pull an earlier offer, and even when to take the most recent approved deal to settle.
First, you mention that even the minimum 500.00 Citi bank is asking for is not within your budget, but were you to come up with it, would they offer the 5 year balance liquidation plan again? If they do, can you come up with the roughly 283.33 every month like clock work for the next 60 months? If you are skeptical that you can meet the lower payment, I don’t recommend enrolling in the plan. Do you have other credit card debts you are struggling with? If so, will agreeing to a long term balance liquidation plan with Citibank (hardship repayment), help you manage your other credit card debts?
If Citi has yanked the offer to set you up on the 60 month repayment plan, they likely would accept a similar plan if it was submitted to them through a nonprofit consumer credit counseling agency. And if you are looking to get lower monthly payments out of more than just Citi, talking to a credit counselor will make sense. Talking to a credit counselor one on one to get a lower monthly payment estimate is free.
Credit counseling companies have decades of history of getting people set up on affordable credit card repayment plans with Citibank. The counseling agency can often get you a lower interest rate and cut monthly credit card payments across all of your credit cards, rather than you struggling to get all or your credit card banks to agree to a plan, or only being able to get temporary hardship payment reductions. You can speak with a certified counselor today at 800-939-8357 ext 1, and also learn more about consolidating monthly payments.
You reference speaking to Citibank about settling your credit card debt. How were you going to fund a realistic settlement offer were Citi to make one available?
What are the options for settling your credit card with Citibank?
If you do not make a payment, or some arrangement with Citibank, the account will charge off and be put into their collection pipeline. If the threat of pre-litigation in this instance is a collection ploy, you will know as soon as you are contacted by the company your debt is placed with. As soon as you know who that is there are some predictable things that will happen next.
If you want to settle the Citi debt, you have to identify a source of funds to do so. The account is not going to go away after charge off. You will have options to make a payment plan or settle the account wherever it lands. My concern is that you do not appear to have the money to do so.
Have you looked into your options with bankruptcy? If not, you should. Without the resources needed, even if accumulated over time, and a realistic plan to settle collection accounts, the situation can eventually lead to court and being sued for your unpaid Citi credit card. It is often better that you are in court on your terms (with your bankruptcy attorney) than on Citi’s terms with a collection lawsuit.
I should mention that threats of and/or actually being sued to collect unpaid credit card debts is not exclusive to Citibank. Other large credit card issuers like Bank of America, Chase, Wells Fargo, Capital One, American Express, Discover, do sue to collect. Sometimes collection efforts on these credit card accounts wont occur until some time down the road, or after your credit card account is sold off to a debt buyer.
Post your answers to the above questions in a comment reply below and I can offer more detailed 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.
Hi Michael
i have about $6700 in crediti card debt between 3 credit cards from CITIBANK.
I have never had credit cards before and never realized that I had to give more than the minimum due to pay off debt. Now I just realized on one card i have a credit card debt of three thousand, however
The statement I just received says 3200?
So I am scared because I am on disability and can only make 1130 a month extra and I am living on my last paycheck right now and currently out of work… I pay my credit card fees always on time for about 2 years now out of my disability payment.. What do i now? Can I get the interest rate lowered?
I live in san francisco and looked at the Hebrew Loan website however to qualify for a loan I need to have a guarantor who lives in northern califonia and who is Jewish that is pretty tough for me .
So where can I get help??
Thanks
Patti.
What are your interest rates on each account?
my friend wanted to settle his credit card account, the problem is he doesn’t remember his account number and he has no idea what to do?
Who is the creditor? How long ago did he stop payment?
If it were me I would call the original creditor and have them look up my account via social security number. They can then tell me if they still have the account internal, or if it is out with a collector, who that is and how to contact them.
You can also find out who to deal with from any negative listing on the credit reports.
I have a video up about how to find the debt collector you owe that is helpful.
I am very concerned…my dad has 3 acct with City…ok, My dad has dementia and has no idea what is even going on. I have tried explaining this to Cities and they refuse to talk to me about any of it…I am worried cause I have tried to take care of this, but cannot because they won’t talk to me…I need help
Fill in the talk to Michael box in the right column so we can email each other and set up a time to talk on the phone.
I got a Settlement agreement with Citi Bank by Mail. The debt was around 9k and they offered to settle for around 4K which was acceptable. I was prepared to make a lump sum payment within 1-2 days. However, They refused to give me a letter prior to payment. They said it would be reported as 0 Balance, Paid less than total amount owed. I told them I couldn’t do this. I spoke to several different people there just to make sure. What do you do if they refuse to send a settlement letter or document Pain In Full?
Citibank is typically good about sending out settlement agreements in writing in enough time for you to pay. But you will not get them to say paid in full if you paid for less. There is no reason to get hung up on how a paid collection shows as paid for less or paid in full. It means little. It is the zero balance you want, and that they do update the credit bureaus with.
Are you dealing with Citibank or a collection agency that sent you an offer letter?
Hi I have a quick question regarding potential debt lawsuits by legal debt collection firms. I’ve received a 30 days to verify letter from a law firm representing another law firm that bought the debt from Citi.
If both law firms are not from my state, does that either negate or significantly decrease the chance of facing an actual lawsuit?
Thank you
It can sometimes suggest the suit is still a ways off, or that there may not even be one filed. But that is getting more rare.
Who are the firms involved in trying to collect from you?
What state are you in?
There are many collection law firms that have offices in multiple states.
Hey Michael, Thanks for responding so quickly.
Taurus law group, MA is representing Crown Asset Management, GA, who apparently bought the debt from Citi.
On their website, they claim they do not operate collections on their own but outsource all collections, which I suppose is Taurus’ role in this case.
https://www.crownasset.com/index.php/crown-asset-management/collections
I’m based in California.
I know there is likely no lawsuit yet because the 30 days is not up yet and I intend to verify and dispute.
What is your ultimate goal to resolve the situation?
I want to let it expire, which theres about 1.5-2 years left on the clock.
That may not be possible without first having to beat back a lawsuit.
Do you mean, you don’t think I can make it the 1.5-2 years without a lawsuit attempt at the pace that they’re going now? Are you familiar with these two companies? Are they suing the majority of cases they take on?
I cannot say whether or not you will be sued. But the risk of that happening before the debt goes out of statute to be sued is real. I am familiar with Crown Asset. I do not see Taurus Law Group come up much. If you do hear from an in state collection attorney you will know that the risks of being sued have escalated tremendously.
If served by Crown Assset and lawyer from Cambeca Law in Massachusetts can you settle before going to court?
What is best way to proceed? Citibank card from Best Buy with balance of $1745
You can settle with Cambece Law for 50% or less when you have not been sued, and often 50% or more after a lawsuit is filed. Are you prepared to pay what you are able to negotiate in a lump sum?
Have been served summons? Likely could put together 50% in 30 days
What I meant was I have been served a summons and have 20 days to respond to complaint to Crown/Cambeca — do I reach out to them about a reduced settlement at this point?
You can reach out now in order to reach a settlement. My experience is that you can often get a better outcome by starting off with defending a collection lawsuit though.
So let them proceed with a court date after summons and then try to settle or actually go to court?
File an answer and defend the suit to start. It would be a good idea to connect with an experienced debt collection defense attorney in your state. You are in Massachusetts right? Shall I email you a list with the experience you need?
I am currently being sued by Amex for $13, 500.00, Modlin and associates, although the attorney is not listed with them. Just received summons for my Citibank account from Debinski and associates for $9500.00. I do have an attorney who will be representing be for both cases. Just wondering what i might expect for settlement?
I also have an outstanding account with care credit at $9800.00, Walmart Mastercard at 2800.00. I settled my chase accounts at about 35%.
Also, I am attempting to settle my husbands Chase account $16500 but so far no luck.
any advice would be greatly appreciated.
How prepared are you to pay 50 percent settlements on the lawsuits, and still fund another settlement on the remaining Chase account?
I have saved up 50% for the 3 lawsuits but that would deplete my funds for a while.
The chase account recently was sold to National Credit and just got notice that my husbands Citibank account was sold to Midland.
Also I have not received the summons but Amex file in small claims for $3100.00.
If i have an attorney represent me will i have a better outcome?
Give me a call to go over your options on the Citibank account that Midland Credit now has, and we can cover the Chase account too. you can reach me at 800-939-8357, ext 2, or fill in the “Talk to Michael” form in the right rail.
I can give you a clear view of how to optimize your AMEX results too.
Hi Michael,
I had a Synchrony Bank/Walmart card, balance 2500.00, I asked for verification and Midland sent a letter back asking why i was disputing and enclosed a statement from March in the return letter. I called Midland to see if we could settle and they stated my account was no longer there it is now with Atlantic Credit Finance, does this mean my account was sold? what sort of settlement would i expect?
Should i call them or wait for a letter and then validate?
I target settlement with Atlantic Credit or Midland (same parent company) differently depending on someones circumstances. We spoke at length last week, and with that I would target between 35 and as high as 60 percent.
Why are you sending disputes and debt validation requests? That is not only not effective, it is a good way to put yourself in the front of the line to be sued these days. See this post for more on how debt validation and disputes work to increase risks.
If your goal is to settle there is little reason to wait. And because I know your situation, stop sending letters out.
ok thanks Michael, i actually did that before i knew better.
Hi,
We have a Citibank lien on our MA property from 2011 (credit card debt). Does Citibank still own this debt or does Lustig Glaser and Wilson (Citibank agent per the court judgement)? We would prefer to work directly with CIti. Thanks
Do you have a copy of the original lawsuit? Who is the named plaintiff? That will tell you if Citibank sold it. You can also call Citibank directly and ask them if they sold it. Let me know what you find out.
HI Michael,
Thank you for providing your expertise and advise to those of us in a tight spot.
Years ago, my husband maxed out 3 credit cards while starting a side business. When the credit crunch hit, we owed Citibank $59K, US Bank $7K, and BofA $17K on the 3 accounts used for this side business. We also had other credit cards for our household that were manageable with my husband’s income, but the side business accounts became a drain every month, to the point where I simply stopped paying them, and focused on the household accounts that I could manage. While maybe not the best strategy in retrospect, I was looking to prevent a complete meltdown of our finances.
We were able to arrange for a 0% hardship plan for 2 of the side business accounts — $924 per month to Citibank and $125 per month US Bank. Bank of America would not play ball, so I ignored them until they sent the account to collections (Northstar Location Services). While Northstar could not (would not?) agree to a payment plan, I would make short term agreements with them for 3 months at a time to establish my own payment plan. I set up a separate checking account for them to draft their payments and not harm our household finances.
We were able to pay these arrangements for 2 years, when my husband lost his job and his subsequent severance had depleted. The balances were paid down to Citibank $27K, US Bank $3,600, and BofA $3,000. I should say that US Bank was definitely the most understanding of our situation and willing to allow us to continue the 0% hardship plan. Citibank went into settlement mode, but we had no lump sum to offer. And Northstar (for BofA) went into slight panic trying to convince me that BofA would recall the account if I didn’t settle with them. My response was I would have the same answer for BofA as I do with Northstar…you either accept the payment I can afford right now, or I will send the payment to US Bank. BofA did eventually recall the account and had no problem accepting whatever I could afford each month. I basically ignored Citibank and the $27K balance.
US Bank and BofA were paid in full. Citibank was sent to United Recovery Systems in June 2014. I attempted a payment plan but they seemed unreasonable asking for a lump sum of the now $28K owed. In March 2015 the account was moved to ARS National Services Inc. And in April 2015, the account was moved to Global Credit Collections Corp.
I assume because this is the third agency to contact us that the debt has been sold. Are you familiar with any of these companies to know if the account is still with Citibank or has been sold? The letters we receive from Global Credit & Collection Corp state that we can set up a payment plan and mail payments made payable to “Citi” There is also a note at the bottom speaking to discharge of debt and it’s tax implications. Is this wishful thinking that Citibank could still hold this debt?? I am afraid to call them and “wake them up” because we are not quite ready to start paying them, and I would like to stay under the radar as long as possible. Our last payment to Citibank was 01/27/2014, so we have not passed the SOL in CA.
What would be your advice as the next step? We have had very limited communication with Global Credit — we visited their website, but have had no conversations with any representatives. My husband’s side business grew to become his full-time employment, so as we pay off our smaller household balances, I foresee being able to make large payments once again to Citibank to pay in full…if they can just hold off any legal action for a little while longer.
Thank you in advance for your help!
Sheri
.
Citibank still owns the account based on what you shared. Can you pull together 8k to settle the old Citi card?
Paying in full at this point does not serve much purpose.
At this time we do not have $8K to offer them….perhaps this will change towards the end of the year. (The current letter is offering $8,985.85 to settle $28,485.85) I am in the process of paying off current debt and then can roll the combined payments to Citi. I understand your point about full payment not serving much purpose — I have an internal debate all the time “settlement vs. payoff”and the emotions of payoff always seem to win in my head.
Let’s connect on the phone Sheri. I have talked with thousands of people and helped them overcome that perceived ethics of settling for less battle. I can give you some tips on getting something set up with Global Credit and Collection too.
Email me a day and some times that are good for you to talk. My address is the same one you get these comment notifications from.
I need urgent advice. a few years ago the company I worked for liquidated. I was heavily pregnant at the time and it took 9 months to be paid my entitlements….everything has just gone down hill from there. We managed to have no defaults listed, until recently. I had my Citibank credit card on a payment arrangement, which has been tough financially. This week we applied through a broker for a refinance on our home loan to clear some of our debt, giving us a little breathing space, but we were declined, Apparently Citibank have recently listed a default on my account.. I started a new job in Jan, monthly pay. They forgot to pay me and I missed a payment. When I rang Citibank in feb they sent letter/s. I advised them I did not received them and request copies be resent, which they claimed they could not resend them. They accepted the new payment arrangement and I B’pay in Mar, but apparently this payment was received 1 business day late. However, they did call me and offered me a reduced interest rate from 20% to 8% and reduced monthly payments from $550 to $360,,,,,,,,,,,,,,,can they have listed a default…..do I have options, I need to refinance in fear of not being able to keep up financially. I look at my little boy and just want to cry. I have requested a copy of my credit report from veda
It sounds like you have one 30 day late pay and that is it. I am not sure that is the only reason you were declined. It could be just really bad timing of your late pay showing up as so recent at the same time your loan application was being processed. If that is the case you can reapply in a few months time.
Make sure Citibank is reages your account. Ask them if they are.
Are there other negative reports in the last 24 months?
Hi,
Thanks for taking my call the other night(4/8 @ 7PM). I have $28k balance with Citicard. Citi has given my account to a collection agency. During the phone call with an agent I offered $6500, he came back with a settlement of just over $16k to settle. How would you suggest I proceed? I can not afford to pay $16k. I offered $6500
How to, and the targets for, negotiating your Citibank settlement will vary depending on whether you are dealing with the bank, a collection agency, a debt buyer, or an attorney. The amount you can save settling by settling for less with Citibank can also vary by how long ago it was you last made a payment.
Who is the debt collection agency?
When did you last make a regular payment to Citi (where you were not already late with prior payments)?
United Collection is the agency. September 2015 was the last regular payment to Citi.
Sorry about that the last regular payment was July 2015. I made partial payments in Aug. and Sept. 2015
I am going through the same thing. I was going through divorce and had a Citibank/Sears credit card. I was told to make a $500.00 pmt and they would work out a payment plan. 2 wks later I receive a judgement against me. This is in 2010. Now that Im trying to buy a house it has to be settled. They offered me a settlement of $1800 but at the time I didnt think the debt was mine, I thought it was already settled. After months of searching I realized it was mine. The bill when it went to collections was $5800 then with all the interest it went to $7700. With my $500 payment it dropped to $7200 So I called to resolve the debt and they told me they wouldnt take any less than $4600 since after the judgement it is now up to $9200…So now theyll only take 50%?
Who is the plaintiff on the judgment (want to know if you are dealing with a debt buyer)?
Who is the law firm collecting?
Has your credit been run by the loan officer or mortgage broker?
Hi Michael, Just a quick question… I had a $72k home equity line of credit through Citi that was tied to a foreclosed home in CA. Being ignorant first time buyers, we accepted an attorney’s advice ‘not to worry about it, as CA has protections against being sued by a 2nd mortgage holder’ (which is does). However, we’ve had the charge off on our credit for about 5 years now (CA statute of limitations is 4 years), so we aren’t worried about being sued. HOWEVER… the issue IS causing a problem with my job (I’ll leave out details) and now I’m being advised to settle the debt (or pay in full).
My question is… this long after the fact, how do I even approach reaching out to Citi, in an attempt to square this away? Do you think that they will be more receptive to a settlement, considering that it has been so long (2010ish) and they’ve gotten nothing for that span of time?
Thanks in advance for ANY insight. I just terrified because I HAVE to square this away (lose my job and I’m in serious trouble) yet am leery that contact may reset the statute of limitations, then I have to worry all over again about being sued for the balance, penalties, interest, legal fees…
Thanks again!
I am going to encourage you to call me for a consult so I can dig into details that will allow me to give better feedback. You can reach me at 800-939-8357, option 2 rings to me. If you subscribed to these comments via email, you can also email that address (it is mine).
5 years ago I cancelled my account with Citi Professional Cards due to their inability to credit my checks to my balance due for three months in a row.. They then declared the account late and started charging me all kinds of late fees. I asked for a final statement to pay it off somewhere in the vicinity of $2800 but never received one. They then just kept adding late charges until they ran it up to $13,000 +. I contacted them to get it straightened out and all they did was yell at me and tell me to pay my debts.
I wrote a letter to the head of professional cards RRR and never got a response until they sent me a stack of statements with no charges just late charges still over $13,000.. I have been served with a court order to represent the debt- now at $8300 five years later. I know I don’t owe that much because I cancelled the card and was going to send them a final bill if they sent me a statement which never came.
What state are you in?
Who is the named plaintiff in the lawsuit against you (want to know if a debt buyer is suing)?
What collection law firm is suing?
How long would it take you to raise, say half the amount they are suing for?
Hi Michael:
I’m in a “world of hurt” and currently have credit card debt that is beyond my abilities to pay in full anytime in the near future. I owe $7300 on a Citi Credit Card. I called them for the first time and looks like my account will be 6 months past due next week. The person I talked to told me to at least send in a $55 payment to “hold my account” then after the payment I could talk to the “payment department” to set up a payment plan. Should I send in the payment or try to settle with them or third parties after charge off?
How prepared are you to pay any settlement you negotiate with Citibank? Can you pay a lump sum settlement if it were a third-ish of what you owe? Do you need payment terms to pay an accepted offer?
What other debts in collection do you have to contend with?
I have enough for a lump sum, I would like to settle for less than 50% since I’m saving for when it’s time to negotiate other cards with other banks.
I would skip the small payment for Citibank to hold off from charge off and collection agency placement if it were me. I would look to settle with Citi at 30 to 40 percent now, or with the first collection company that gets it.
Thank You Michael,
I called and offered $2000 they countered exactly 40% of the value. They gave me 4 days to get the additional $923.19. I still have a bunch of credit cards to settle in the near future. I’m going to call on Dec.5th (3rd day) to offer $2480. Or should I just pay what they are asking for, rather than risk losing the offer?
I would try the counter offer direct to Citibank’s recovery department first and see if you can get that approved. Let me know hoe that goes.
Ok some data from my case, today was 1 day before the (40% settlement) offer expired. I called in, they told me they are the “Payment Arrangement”, (spoke to different person didn’t transfer me to anyone else). I offered the $2480, she said they couldn’t accept anything lower than the $2,923.19 offered. I’m currently at 154 days past due. I’m going to risk it and call again at 170 days past due and see if they will budge.
****CORRECTION*** Today IS the last day to accept the 4 day offer.
Hi, I missed four payments with CitiBank due to a medical situation and now they closed my account and referred it to a collection agency. My balance is $14,000, with $2,200 past due. I called the agency rep who offered me a couple of options: 1) a 50% lump sum settlement of $7,000, which is out of my budget. 2) A plan which would have me pay the past due amount of $2,200 by the end of this month, and then about $320 a month until the remaining balance is paid off. I told her I need to examine my records and budget but agreed to immediately pay $1,100 and call back tomorrow with a decision. My question: do you think they would accept a payment plan of $2,200 this month, and the remaining $4800 in another 30 days? I’m motivated to settle it, and be gone with it, as opposed to paying $330 a month til the next ice age. Thank you for your time and service to the community.
Who is the collector for Citibank?
When did you last make a payment to Citi?
Depending on the answers you post, I think you can get a better settlement.
Mike,
UCB asked me to write a hardship letter for them to submit to Citibank which I did. After a week I called back and they told me it was rejected but a counter offer was made that was 35% of the balance owed. I called Citi the same day and they said a letter was never received and I could submit it directly to them. Today I call Citi and they tell me to deal directly with UCB. Should I try and renegotiate and apparently they never forwarded the letter or just settle at the 35%?
Thanks,
Dave
That may be as good as it gets with United Collections Bureau. If you have the resources to work with, taking the deal would be a relief, and remove any risk the account is next placed with a debt collector that is less flexible.
This will be the first one of four that I settle. Absolutely I should have a letter that this states paid in full or something of that sort correct? You have no idea how much this site has helped me and I greatly appreciate it.
I like to get everything documented before remitting payment.
Dear Michael. I am in Asia. When I was a student in the US more than 23 years ago, I applied and used a Citibank Master card. When I finished my studies, I returned home but I know I had some unpaid balance in the card. I remember getting a letter from them (or maybe a debt collector) shortly after about my missing payment, but after that I did not hear anything until today. If I remember correctly, my unpaid balance is not really much (maybe few hundreds dollars). Now I want to pay them back the unpaid balance. Hopefully they do not impose an interest for the unpaid balance. What do I do to pay back the unpaid balance? Will Citibank impose an interest?
Did you hear from someone about the debt, or are you being proactive?
After this long it would not surprise me if Citibank did not have the account, or even the ability to locate it. Unless you were sued for this debt, there is really nothing about it that will impair your credit and financing options.
I would do nothing about the debt unless you learn you were illegitimately sued after you went back home.
Actually no one is chasing me for this debt. After all this while, they may have lost my record or they are not interested anymore. I don’t know. It is my choice to pay them back but I am not sure
how. It has been a while.
I have helped people with similar goals Yuan. Can we connect on the phone for a consult? You can reach me at 800-939-8357, choose option 2.
Hi Michael,
I have an outstanding charged off debt with Citi for over 7,000, there have been several collection letters which have gone unanswered but recently I received two thick packages of ALL of my credit card statements from the Citi card. I don’t know what that means or even if its a normal thing but it seemed like a scare tactic since all it did was confuse me why they would send such a huge pile of paper to me. Is this simply a harmless scare tactic or are they preparing for a lawsuit? I don’t believe I received any lawsuit notices…
Also, since this Citi card is my largest liability out of my charged off cards, should I request validation and see if I can get it removed?
Thanks.
Those large envelopes of Citibank credit card statements are usually sent to someone who already requested debt validation, or as part of discovery in an active lawsuit.
Check your local court records to see if there is a suit filed against you that you did not know about. Let me know what you find.
If you have never requested debt validation from Citibank, what would be your purpose for doing so now? It will not help you get it removed from your credit reports, or from the courts if there is already a case filed.
How long ago did you last make a payment on the Citibank account?
What state are you in?
Im in California
Last made payment around late 2012.
I did not get any notices about lawsuits and I know they have been sending some things recently so Im assuming I would’ve gotten the lawsuit notices if there was one pending so I assume it was a debt validation and I think I did send out a debt validation when I received a collection letter. If they sent the statements as a response to my request for validation, does that mean I am obligated to respond to them automatically or do they need to send another collection letter to notice me?
If they are serious about sending the huge pile, does that mean they are getting ready to take more serious action against me? Should I try to settle before they go the next step (if they even are)?
They sent you way more than is typically necessary in order to meet the very low standard for debt validation. In my opinion and experience, with Citibank having responded to your debt validation request in they way that they have, you now have an increased likelihood that you are sued. You can read more about why I say this in this article about sending debt validation letters.
You can respond to Citibank if you like, but what is your goal in doing so?
Citibank is likely thinking (and rightly) that they met their debt validation obligation, and I would be surprised in continued collections did not continue from here.
If you are motivated to settle, what you can you afford to pay on a percentage basis?
Out of a 7600 debt balance, I cannot really pay more than 35-40%. I’m hoping to get 30% or less would be great. What would you recommend as a strategy to get it as low as possible? This is my only other high balance debt account, the rest are smaller in value so easier to deal with.
Called CITI Recovery department today:
Balance : $7618.04
1st offer : $1500
1st counter : $6,94.43
2nd offer : $1905.51
2nd count r: $4570.82
3rd offer : $2,000 (26.25% of balance)
3rd offer (FINAL) : 3,800
Its too much, I did not accept it, I would’ve accepted $3,000 probably.
On the phone, they were inputting my offers and receiving automatic counter offers on the computer.
I suppose it would be better to deal with a debt collection company since they buy the debt at a cheaper rate and would have more authority to get me lower than what CITI offered. Though I’m confused why have I been receiving debt collection letters from 3rd party debt collectors but CITI is also willing to negotiate with me directly?
There are times where working with a debt buyer will yield a better settlement outcome than when settling direct with Citibank, but there are times settling directly with Citibank, or a debt collection agency working for them is better.
At 50% I would likely hold out too.
Why Citi is wiling to conduct the negotiations internally when they have your account placed is a bit odd, but not unheard of.
Michael, I called United Collections Bureau afterwards to see if I could work out a better deal with them and they told me Citi took the account back so I have to deal with them directly.
Do you think I could ever get a settlement for $3,000 for $7,600 for a deletion of the account from my credit reporting agency? After all, the only reason I’m doing all of this is to begin rebuilding my credit as soon as possible. I suppose if they allowed deletion, I would try to get the money together to meet their offer at $3,800.
Here again (similar to the other accounts you are settling), you have a zero percent chance of getting Citibank to agree to what many call pay for delete.
Hi Michael,
I just received a letter from Citi saying Citi sold a specific debt to Crown Asset Management. This debt is supposedly almost 2 years old. Is this a normal occurrence? Should I expect legal action from Crown? What kinds of settlements have you heard about getting with Crown? Thanks
Citibank does sell unpaid debts. It is a normal occurrence.
I would call Crown Asset Management and negotiate a settlement targeting between 30 and 50 percent. Your success can depend on how collectable they see you.
Thanks for that advice but I can’t reasonably pay it right now. I know there is some law in California that states the creditors can’t sue after 4 years from your last payment. If Crown purchased debt from Citi, does that 4 years renew or is it still counting from the last date of payment made? What are the chances that they might take legal action in the remaining 2 years of the 4?
The 4 year SOL to sue for unpaid debt in California starts with when you last paid. The account being placed with Crown Asset does not reset that.
Being sued on unpaid debt is one of the common risks. I cannot say whether or not you will be sued on this account in the next 2 years. It is a good idea to save up and negotiate a settlement to eliminate that risk. I understand when that is not always possible.
Thanks Mike,
Is Crown Asset usually considered one of the more aggressive companies when it comes to debt collection and legal strategies?
I do not find them to be.
Hi Michael
I went to the bank twice and got pre-approved for a mortgage and then pre-approved for a secured line of credit for land only. This approval was based on my Equifax report and said I had an A rating. We didn’t go through with any purchasing of property. Four months later I went back to the bank to apply for a different line of credit to build a basement. When my banker submitted for approval it came back declined. I still had an A rating however this time it went through Transunion. Five years ago I had a Citibank M/C. I don’t have exact figures but I owed approx. $5000, I offered them approx. $3500 to close the account. They verbally accepted the offer but also stated that it may be a problem if I try to apply for credit in the future. It has been almost 5 years and I have never been contacted or persued by a collection agency. I called Citibank for information on my account but they said they have nothing on record and told me to contact the collection agency. Other than the info from the bank how am I supposed to know who to call if Citibank has no records? Do I call Transunion and see what is up? If so do I make them an offer? I’m not really sure where to go from here or what I should be doing. I hope this all makes sense to you. Thank you for your time and advise.
Who was the collection agency involved in accepting your payment of $3,500.00? Did Citibank refer to a different collection agency in your recent call to them?
Hello. Does anyone know the name/title and mailing address of Citicard’s settlement department or default accounts?
thanks.
Most banks refer to those areas as either their collections or recovery departments. I am not a fan of sending letters in an effort to resolve debts. Different types of letters people send Citibank can lead to a legal review of your file. That is something most people should stay away from. What is your goal with your Citibank?
The general correspondence address is likely sufficient for the purposes of sending a settlement offer or letter to Citibank:
Citibank Customer Service
P.O. Box 6500
Sioux Falls, SD 57117