A site reader recently wrote in to ask about dealing with a large debt collection agency by the name of Radius Global Solutions, who they are, and whether to settle a debt with them. The submitted questions are great, and as is the case with much of the site, I publish the exchange so others can learn from it.
I would like to ask you about settling a debt with Radius Global Solutions, LLC. Are they legitimate?
Radius Global collects on accounts from many different banks. I run in to them all the time. If you are curious about whether they are legitimately collecting on your account you can call your original lender and ask who they have your account out with for collection at this time. Your creditor is nearly always happy to provide the details.
What leverage do I have to get the agreement in writing or is the letter sent by the collector sufficient for an agreement and payment terms?
Your leverage to get your settlement agreements in writing is the money you are offering to pay off the account.
Nearly all collection agencies have the ability to send you the settlement in writing once you have negotiated a deal.
If Radius has already sent you a settlement offer in the mail that you like, and can afford to pay, just be sure you are acting on the letter by the expiration or due date. If you need a new date you can call Radius Global and negotiate a new date, and get a new letter.
In general, what cases does the “settled” portion of a debt greater than $600 get taxed and in what cases does it not? In the cases it is not taxed, what specific terminology is used in the agreement between the collector and the payee to ensure that it is not taxed?
Generally speaking, all settlements where you save in excess of $600, should result in a 1099c being sent to you and the IRS the following January. Having been at this for a while, I recall a time when no one got them. Nowadays few do not.
There is no effective language or negotiation tactic I can provide that results in a creditor or debt owner agreeing to ignore a known tax reporting obligation. There are some instances I have seen though, such as when there was active litigation, the settlement has resulted in an agreement not to report. I am not sure the IRS would be cool with it.
Radius Global, as a contingency collection agency, and collects on the debts of others. I highly doubt they are ever in a position to negotiate anything about the tax reporting requirements of the companies they collect for.
You do have the ability to submit IRS form 982 to show you were technically insolvent at the time of settling, and should not owe a tax.
Radius Global Not Known To Sue
The reader submission went on to ask more generalized questions. Some of my answers tie in to all debts, and some are specific to Radius Global, such as the fact that, as a contingency collection agency, they do not file collection lawsuits.
Finally, in general, is my following assessment of debt collection accurate?
It is best to settle with the credit card company. They will likely close the account for this.
Your accounts are typically closed after a few months of missed payments. By the time you are settling for the best savings you should already be dealing with a closed account. If you are not, yes, settling for less would close the account.
It is not necessarily always true to say that it is best to settle with the original creditor. There are some creditors that use Radius Global for collections where I would get a better settlement savings outcome from Radius than I would the creditor.
Getting more than 3 months to pay on a settlement is much more likely after an account gets charged off and placed with a collection agency like Radius.
If the account goes to collections, is it best to settle with the collector instead of being sued?
Nearly every time this would be true, but there are some limited exceptions to this. One would be when you do not have enough to settle an AMEX account that Radius may be collecting on, and you can use the formal collection process in the court to your advantage. This would be after the account gets pulled from a collector like Radius Global, and sent to a collection law firm.
A charge off occurs from the credit card company when the debt is not paid for a period of time. This event damages the credit score.
Yes. Most of the damage is done leading up to the charge off, but that is the pinnacle of negative impact from an unpaid credit card.
Another hit to the credit score occurs when the debt is paid to a collector.
Not true. Many of us will only see a benefit immediately, and there after, from settling and paying a collection account.
There are many instances though, when settling an old and stale unpaid collection account, that can bring a certain level of freshness to the negative. I do see temporary dips to credit scores in some of these cases. And there are scenarios where peoples expectations are to see their credit scores jump after settling 1 out of 5 collections, which is not always going to be the case. Several other things could be holding back improvements.
Another hit occurs to the credit score if a lawsuit is settled regarding the debt.
This has not been true since July 2017 when most of us saw the removal of judgments showing on the major three credit bureaus.
It is best to pay a non profit debt management firm instead of a debt collector as the event will remain on the credit report for less time, like 3 years instead of 6. However, to do this, involves a total survey of your debts and ability to pay a monthly amount to resolve the debt through the third party. In some ways, it is similar to filing bankruptcy but it is not as extensive and involved.
This is not accurate. Debt management plans with credit counseling agencies last up to 5 years. If you enroll a collection account with Radius Global into a plan like this, none of those monthly payments are getting reported. If the plan goes the distance, your credit is going to be much worse than if you settled with Radius for less and paid it off much quicker.
The similarities between a DMP and a chapter 13 bankruptcy start and end at:
- Creditors are getting paid (though in chapter 13 not necessarily in full).
- The plans tend to go 5 years.
Radius Global On Your Credit Report
Radius Global is a contingency debt collection agency. They have your account because you are already late with payments on a debt. It is more than likely your credit card bank that is going to be doing the credit reporting on the account, and not Radius.
Radius is not in a position to tell the bank they are collecting for how to report your account. Negotiating a pay for delete with Radius if they are not the company reporting is not a good use of time.
Your original creditor, such as a credit card bank, is not typically open to the idea of deleting the negative item they are reporting to the credit bureaus. Not if you settle for less, pay in full, or even offered them double.
Paying the settlement you negotiate with Radius Global will normally result in the creditor updating your credit to show a zero balance owed, or paid collection.
An exception to this would be if Radius Global is collecting for a debt buyer that does have a pay for delete policy. Several larger debt buyers will do that now, such as Portfolio Recovery and Midland Credit. But these debt buyers that have these pay for delete policies would not require you to negotiate the pay for delete outcome through a collection agency like Radius. It is a credit reporting policy that would apply without asking for it.
Anyone wanting help to resolve a debt with Radius Global is welcome to schedule a consult with me, or request an estimate below. You can also post in the comments and get feedback here on the site.
How long after you pay your debt can you open a new credit card to start building credit?
That will vary for each of us. I help people settle debt who open new credit cards within a couple months of completing their last settlement.
Do you have any other collections than what you paid off with Radius Global Solutions?
Hello, I spoke with radius global solutions I told them my hardship real story can they forgive my debt?
No, Radius Global is a contingency debt collection agency and cannot forgive your debt. That is something the original creditor or debt owner would have to approve and most do not.
Hi Michael, I have an old debt from a credit card company that fell off my credit report last month. Would it be worth settling that debt with Radius? They are offering to settle my $6,500 balance for $1,200. If I do pay the $1,200, would the account reappear on my credit report? I also remember picking up a phone call and sort of confirming the debt like 5 years ago 🙁
What state are you in? Who is the creditor that Radius is collecting for? Did you stop paying on the account roughly 7 years ago?
I live in Mass and yes my last payment was in 2016
I would not pay an account like this, if it were me.
Radius is collecting on Zombie debt.
The SOL to sue in your state is passed. The limit for credit reporting the collection has expired.
You live in a state where verbal acknowledgement would not reset the SOL.
I would not be motivated to pay in this situation, but if you were to take Radius up on the settlement, no, it should not reappear on your credit reports.
First let me say Hello Mike, I found your website very helpful and useful. I am leaving a comment her in hopes that I might get an answer to my question. I have a best buy citi bank card that I went over the limit several years ago. I have been making payment to them regularly of between 130 and 160 dollars and watching the over the limit amount go down. On their website it states currently my statement balance is $4,108.97. My current balance is $3,958.97. I am over the limit by 358.00 my statement past due amount is $481.00. With a minuumum payment of $1,162.97 required. My payments are due on the 11 of each month. I am self employed and I try and make payments onetime, but sometimes I am late. Like this month I didn’t have the money to make the payment until recently. I got an email today from Citi saying that they were referring my account to Radius Global Solutions. I logged onto the Citi website and made a payment of $150 as I usually do. I tried to call Citi to talk to them but the call was answer by someone at Raidius Global Solutions instead of Citi. I am prepared to go on their website tomorrow and make the minimum payment they are requiring of $1,162.97. I was just wondering will this stop Radius Global Solutions from trying to collect and will Citi pull the account back from them and let me get back on track with them ??
I would call Citibank and ask them if they have closed your account, and what you need to do to prevent that from happening if they have not. You may be able to get this back on track.
Are there any late pays showing on your credit reports from Citibank at this point?
I can’t reach citi when I call their number put in my account it goes directly to Radius.
Yes, thir is a bunch of 300 600 on it and one recent 90 onit from February
Sorry 30 and 60
With the credit damage already done I often suggest settling the balance for less than the balance owed at this point. How long would it take you to pull together 40% of the balance?
I am not sure you will be able to preserve the account at this point.
Not sure, if I can pull 40% together right now for one large payment. Since Citi just sent me the email that they referring my account to Radius a day ago an I can still access my account online, I was wondering if I make the late payment and bring the account forward and up to date stop Radius from doing anything ??? I have the money to do this but I don’t want to blow it if Radiuss is gooing to come back and demand a big payment to settle things.
I watched one of your YouTube videos where youu talked about collection companies just hire 3rd party collectors and they get a precentage of what they collect andd if they don’t get someting then the credit card company contracts with another company. And then there is collection agency that buy the debt. How can I tell which type of company Radius is ???
sorry one more question what happens if I do pay it on the Citi website and bring the card back to current. Will Citi pull it back from Radius or will Radius keep it and demand payment in full ??? Sorry for so many quesions I am just trying to formulate the best plan of action so as not to waste money that I have to make the payment.
This is what I would want to talk to Citibank about directly.
You can call from a different phone number, and not enter any identifiers for your account when the automated assistant picks up, and get your call routed to a Citibank representative that way.
Radius Global is a contingency debt collection company. The earliest Citibank would typically sell an account is when it goes more than 180 days late.
I settled a debt originally from art U-verse that was sent to another credit collection agency and then to here. It was paid in feb. 2/16 pd 288.00
2/28 pd 200.00
The debt was paid in full after the second payment and att is still not showing any payment made or debt settled. They are claiming I still owe 369.00 which was the original debt at first. I can get no one on the phone here. I have the statements from my bank to probe this. Do I have any legal action that I can take because of the time that it’s taken and the stress that it’s been causing me. I have been told now by AT&t I cannot add a new line to my wireless account that has been open since 2015 because of this debt that has been paid roughly a year ago and I am losing out now on $80 in credit and the special deal that they were going to give me and I’m afraid I’m going to have to pay for the line at full cost now that I was told the original offer and credit towards my bill was a one-time offer. What can I do who should I call AT&t is no help I can get nobody at this credit collection to answer the phone.
I want to be sure what you have going on. Your ATT bill went to Radius Global for collection. You paid the full amount owed on the debt back 3 months ago, but ATT is not recognizing that, and the collection agency has not picked up your calls.
Is that right?
The original creditor is CenturyLink. Amount owed is between $360 and $400. I would love to return the equipment. More importantly, I want my credit score back. I am willing to pay what is necessary.
Now that I read your advice to other situations, it seems the best bet is to contact Radius directly to negotiate. My money owed is in relation to residential internet equipment not returned on time. The charge is almost $400.00 for a modem/router.
I would indeed be negotiating with Radius.
If you are trying to get this removed from your credit I would look for clarity on this from them before resolving the account.
If, at the end of the day, this will not get deleted, they would still have to update it to show resolved and a zero balance.
Your credit can bounce back fairly quickly with a single paid collection next to an otherwise great credit report.
My credit score has been exceptional for years (840). When I moved, all became unorganized. The agency filing for nonpayment was contacting me via email for which I had no access to that account. I didn’t know i was in collections until my bank notified me. Initially, when I called I was excused of returning equipment on the timeline. I did not have access to a full service post office at the time. I was out in the middle of no man’s land. I called again and no one of position would talk to me. I don’t believe they care about my return. They want money. My credit score has plummeted by 130 points. Global Solutions is the collection agency.
Who is the original creditor?
What is the balance owed?
What is your goal for resolving this?
I got a letter from radius on my dental bill of $700+ . The accrual dental bill was $560. Radius indicated if I responded to the letter within 30 days, they would not file a bad credit against me. I never provided my Social number to the dental office . If I do pay in full does that mean they really won’t do anything against my credit? Or should I call them ? Thank you for your time and any advices.
I would call Radius and get clarity on what they are offering to you.
I accepted a settlement of 50% of my debt with 12 payments of 566.00 due to other obligations i can no longer afford thw payment which is over 1/4 pf my monthly income.. I was hoping to settle now with 1 time payment would this be possible
Who is Radius collecting for?
I got the letter today radius picked up my citibank account as a contingency. How low are you seeing on average radius go % wise? Citi directly offered me 40% before charge off.
The letter radius sent me cited the tough economic times and was strongly insinuating they will settle for less than owed just didn’t offer a number or %. My initial research shows that they are pretty easy contingency collector to work with based on what people have posted. Thoughts?
I find Radius pretty easy to deal with.
What you can settle with Radius Global for can vary depending on the creditor, and how collectible you look on paper (mostly from what they see on your credit reports).
Freshly charged off Citibank credit cards with Radius still tend to get settled in the 40 percent range.
Thanks again Michael only 4 accounts total left for me to handle as I just confirmed 35% negotiated over the phone with radius. Letter is in the mail.
Congratulations on your settlement with Radius Max!