My experience working with financially-challenged consumers and their creditors nationwide since the economic downturn reflects that virtually every national issuer of credit cards, even larger regional credit unions, have gone as far as they can to assist their struggling account holders. Capital One is an exception to this. How Capital One goes about settling a debt with you, their treatment of credit reporting after agreeing to reduce your balance, and the fact that they are the most likely to sue for collection, all combine for one huge exercise in caution and awareness.
Credit card issuers offer plans to reduce interest rates on credit cards through hardship plans, debt management plans, credit counseling plans, or offer balance concessions through debt settlement, which go a long way in helping their customers avoid bankruptcy. In this way (credit card payment concessions), Capital One is not all that different from other credit card banks.
Capital One, in my Experience, is Tough to Work with
Banks who are paying attention know that working out some type of arrangement with account holders, who will otherwise be forced into filing chapter 7 or 13 bankruptcy, is in their best interest. Creditors will generally offer fair concessions as a final option because they will lose the least. For more about this see: Banks Choose to lose the least.
I am not sure Capital One is paying attention.
Capital One is quick to use the courts in order to collect on delinquent accounts. They would apparently rather their account holders file bankruptcy.
I continue to encourage seeking bankruptcy protection if your debt is mainly with Capital One.
Now we have Capital One choosing to be spiteful, and perhaps illegally, with those few credit card holders they may offer fair concessions to. To see the collection letter referred to below in its entirety: Capital One Collection Letter
The coupon for $50.00 you will see in the collection letter linked above is not all that new a twist to get a delinquent CapOne credit card member to call MRS Associates (a debt collector). It is worth noting however, it is only a collection ploy and nowhere near worth taking advantage of the perceived “FREE STUFF”. The main problem I want to draw your attention and provide awareness to, is number 9 on page 2 of the collection letter.
9. Credit Reporting of Your Settled Account. If your Account is settled before it is charged off, the remainder of your Account balance will be charged off. We will then report your Account to credit reporting agencies as settled with an outstanding balance.
Fair Credit Reporting Act (FCRA) and the requirement to report only complete and accurate information to the Credit Reporting Agencies (CRA’s)? This would FALSELY characterize the trade line and SKEW any later debt to income and/or utilization formula rendering them inaccurate as well. This means that Capital One could be causing consumer’s damages post debt settlement, when they are applying for future loan products whose interest rates and even approval will be factored on a credit report that contains erroneous and false information.
Reporting a balance still due and owing when it has been forgiven would falsely characterize this trade line in your credit report. How do we know the unpaid portion of the settlement is forgiven? Let’s look to number 8 on page 2 of Capital Ones collection letter:
8. IRS Reporting of Debt Forgiveness. If we cancel or forgive $600 or more of principal on a debt you owe, we must provide a 1099-C tax form to you and the IRS. Please consult your tax advisor and the instructions accompanying your tax forms for more information.
How can number 8, indicating the required reporting of forgiven debt to the IRS, comport with erroneously reporting an outstanding balance when it has:
- Been forgiven
- Been settled for a lesser amount agreed to by both parties, thereby leaving no “outstanding” balance
If you have a Capital One story to share, especially as it relates to improper credit reporting, I invite implore you to share it in the comment section below.
UPDATE: Since publishing the above Capital One article about credit reporting and settling Cap One credit cards a couple years ago, some softening of options available to account holders who fall behind has occurred. We do still see the poor credit reporting policy on settled accounts with Capital One, but have also seen how that is getting addressed using disputes with the credit bureaus.
If you are serious about resolving unpaid credit card debt with Capital One and have other credit card debts to resolve, it is important to prioritize accounts and target the best savings with the available money you have and can project saving up in the short term. If you have an experience with Capital One collections, credit reporting, or lawsuits, please share in the comments below. If you have questions about how to handle debts with Capital One, post in the comments for feedback.
I lost my job and my capital one account went on default, original balance a little over 12k.
I signed for their hardship program and have been paying for an average of 6-7 years, don’t t remember exactly. The balance is down to half, they collected every month.
Around a year ago they stopped reporting and the account is no longer in my credit bureaus and stopped collecting, i called and renewed the payment arrangements for one more year, always doing the right thing. A few months ago they stopped collecting again.
i called and they said that there is no more collecting, i have to call every month and pay voluntary wich i started doing again.
Why the voluntary status now?
In what kind of status is the account now?
I want to make sure this account doesn’t make it back to my bureaus.
They have treated me good so far.
Paying voluntary will revive the debt?
What it means the voluntary status?
The balance is down to half.
This is an odd situation Jose.
For how long had you stopped paying Capital One before you got on the hardship plan?
What to do if capital one has filed a lawsuit already but I do not want to file bankruptcy?
How much is Capital One suing for?
When did you get the court papers?
What law firm is handling the suit for Capital One?
How much total debt do you have?
I have a capital one credit card and in 2014 I got a letter from the collection agency saying that I qualified for hardship and no further collection attempts will be made capital one is reporting to the credit bureau as a debt not paid.
If your goal is to improve your credit you will want to consider negotiating a settlement. If you want assistance with this you can click the get debt help tab in the upper right corner and complete the prompts to submit for help.
Hi Michael, I received a post card from capital one with a court date.
This was an original debt I thought was written off years ago. I have a serious disability and thought the agency that first handled this got rid of it. I went to the courthouse last week to pick up the papers for the original debt amount, but it is in archives and will take two weeks to get them. This brings things very close to the court date. I’m not sure if I should call Cap one directly?
It was good to speak with you yesterday Jon. Let me know what you learn when you get the court research back.
Hello Michael, I opened up an account with Capital One last year with a credit line of only $300 and i used the credit card up and never paid it back up until now because i am more financially stable now i called and spoke with a representative and she told me that my balance is only $451 to pay it off but my account is closed that I would have to reapply again but there is no garantee that i will be approved again. Is that true how does this process work please let me know
Capital One is known for offering account to people again after you resolve collection accounts. I would wait a few months before applying after I settle with them. You can also look at rebuilding credit using secured cards.
Michael, I , like thousands of others, lost a good job in 2008 and the rest is history, as I am now a senior citizen with a poor credit rating. I have three Capitol One credit cards with a total owed of approximately $2000-$2500, which doesn’t seem a lot compared to many people. I work part time and with SS benefits, I want to pay off what I owe them. In the last 1 1/2 years, I have received collection letters from at least 5 collection companies; they change every few months. I tried to contact our NC Capital One Office and they said I had to deal with collection agency. What to do? Should I pay off compete balances or try to settle with them for amount owed less all the interest charges. The total of interest on three cards is almost $500. Will it make a difference on my credit? Thanks for your kind help. Any advice will be appreciated. Thank you. M Frye
It it were me I would work out the lowest settlement possible with the debt collectors (be sure to get everything in writing before you pay).
With accounts this old it does not really matter if you pay in full or settle for less. You want the zero balance reporting in order to start improving your credit, and you get that either way.
I had my wages attached by Capital One back in 2014. I paid of the total judgements through the courts. However when applying for a home loan found it was still on my credit report to his day. How do I get it removed ?
As it stands today, judgments have to age off your credit. You cannot go to Capital One or the court and get it off your credit. But you can still get a home loan with a paid judgment on your credit reports.
Hello Michael,
I have to say your information is very informative. I just want to see on your opinion. I have 4 Capital One cards: 1: 90 days past due and 3 : 180 past due with a total balance 37,484.48 closed by them. I lost my job 1 year ago, and fell behind Payments 6 months ago. I called them advise of my hardship after the first 30 days, but offer to reduce payments only. I was thinking of settleing the accounts before charge off on my own or go through national debt relief or what after it get charged off and then settle. What do you think would be the right path?
Settling with Capital One quickly right before, or after charge off, is ideal. Can you pull together the money to fund 40% settlement deals all at once?
I am a big fan of DIY debt settlement. If you want help fill in the Talk to Michael form in the right column. When I see that I will email you to set up a free phone consult.
Is it an abusive practice by Capital One keeps raising the limit on an elderly person who knew that her income was only 1.2K a month? This elder previously had THREE CARDS with this same company but the debt she ran up was cleared out in bankruptcy. Now I feel that they are setting her up again because a year after clearing the debt she applied for another card and they gave her a $2K limit. The interest is over 22% and she pays the minimum balance which is getting her nowhere. They have raised her limit from $2K to $5K in about three years and she is on disability getting about $1.2K per month.
I have not seen a case or regulatory action that would suggest offering people credit is an abusive practice.
That is kind of like saying the grocery store is involved in abusive practices for stocking candy bars. The bars are there, but you do not have to buy them. Similarly, the credit is there, but you do not have to use all of it.
In December of 2015, I called Capital One to place a hold on my credit card. they failed to do this, Fraudulent charges were placed on my card from January through April. On each and every statement which only contained fraud charges I called or wrote a letter to them to say the charges were not mine and fraud. Even after i notified them, they STILL allowed charges on my card. This happened for a period of 3 to 4 billing cycles, After 2 letters and 3 phone calls I become totally disgusted with them and sent back or threw away any correspondence from them. Now they have hired a collection agency to collect the money that I SUPPOSEDLY owe. They claim the amount is about $360 but will.settle for $305. NONE of these charges are mine! It would seem they ignored my calls and letters and allowed more fraudulent charges to continue with subsequent interest and late fees. I wrote a letter to the ceo of Capital One to see if he would do anything in this regards. I can”t believe the incompetence of these people. Have heard nothing back. Now they are calling this a charge off and trying to destroy my credit I have no other outstanding debts that I have not paid or am behind on. Can’t believe these guys!!!
I would file a complaint against Capital One with the CFPB.
will do !!!!
thank you for your website
should I respond to Northland Group 30 day letter or let CFPB handle it. CFPB has 3 addresses. Which one should I use
Click the link in my comment to you and follow the information about how to file a complaint with the CFPB on their website.
The CFPB is a letdown. They don’t help you all they do is get the company to reply. The reply can admit wrong doing and the CFPB does not do anything about it. Everyone in the financial community will pass the buck and have no accountability.
Hi Michael, great blog, thanks for posting all these Q & A. I have a charge off with Capital One. Last payment was in 2013. They continue to report the debt to Equifax. I am considering contacting them to pay the debt but am concerned after reading so many negative experiences on your blog. They report the debt annually to keep it current on my credit file. My question is what is the start date from which 7 years is calculated for the removal of the report due to the statute of limitations? If the date is close to the 2013 time when I made my last payment, will that date change to a more current date if I contact them now? They are mean hombres and I have zero trust that they will do the right thing if I do the right thing by paying them. I look forward to your answer and any advice you can give me.
Check out this post about when negative information drops off your credit.
It is the date you stopped paying, and contacting Capital One will not change that at all. Even paying or settling with them will not change the drop off date.
Hi i just recieved à served letter from thé sheriffs office that à new York law firm is suing me on behalf of capital one bank for 4500 . What documents do they need in order To win this jugement and does capital one provide documents To debt collector in order To win jugements? I would like To see proof this is mine and i infact made thèse pourchasse- thank you for your help. Do you know what my next Step is. I have 10days.
Do you have reason to suspect the debt is not yours, or the charges or the result of fraud?
If not, Capital One has all they need to prove their claims. And they regularly take collection cases to the mat. Even for as little as $500.
Let me know the situation with your account, and what your goals are, and I can offer more specific feedback.
Just recieved a letter from Suttell, Hammer for a capital one credit card debt. Gives me 14 days to respond. Balance shows $1882, willing to settle for $1300 in two payments or monthly payments. I have other debts and cannot afford this. I got into financial trouble when lost my job but am now working, but not making enough to pay extra. Am worried about being taken to court.
Is the Suttel and Hammer letter notice of suit, or contact them in order to resolve the debt?
If not yet sued, calling to negotiate the settlement with the realistic expectations you have is good. If suit has already been filed I would defend it in order to get the best outcome.
It is the first I have heard from them and it says we have 14 days from the date of the letter to reply with what repayment program we will do. Is it realistic to think we can offer them a settlement of lower than what they ask? ( like maybe $500 at the most?)
Thanks
At this stage you will have to battle to get 50% off.
I have a judgement against me from an old 2008 account with Capital One for 3K plus. The lawyers who recently surfaced are trying to garnish my wages. I have never made much money but I have a fair credit report because I am working hard to reduce my current debt (including 2 new cards with Capital One!). I am 64, working a seasonal job and in HUD housing. I would like to request that they forgive this old debt so I can remain current on my new debt,
They will not forgive a judgment debt. Check out my video about garnishment and bank levy.
I have a debt with capitol one for 5 years i only owe 250 they charge me 1600 for interest im looking for an apt wirh a credit score of 570 by paying this off will it help. Me this is the only debt on my report that im aware of i need to get my credit reports. The only other thinhs that could be on there are standards bills with slow payments tjat have been paid off i just opened a daniels account paying on time
Settling or paying the account with Capital One should result in an update to your credit reports. Read more about how to improve your situation with renting an apartment with still poor credit.
Have you been paying Capital One directly, or a debt collection agency working for Capital One?
Hi Michael. I missed ONE payment and was 38 days late. I called today to see if I could avoid that from going to the credit bureaus and they said “no”. I did not make the payment to see if there is a way to negotiate. I don’t have any missed payments on this or other accounts. Any ideas?
Thank you
What is it you want to negotiate, and with which bank?
i had a judgement 2010 from capital one . i filed bk in 2012 . i am closing escrow selling my property but now have a lien for $1999 ., would i owe this if i filed bk already? the strange part is when i originally closed escrow to buy in 2014 none of this came up ? why now ? i contacted capital one all they direct me to is a fax number i have yet to get a response ? i want to clear this up if i have to pay or not .suggestion?
Was the judgment listed in your bankruptcy petition? If you do not readily know talk to the attorney office that helped you. Let me know and I can offer more feedback from there.
We have two capital one credit cards that have been charged off for a few years. Capital one still holds the debt it has never been sold. They are reporting every month with a late payment. Is this allowed? We are now up to 27 late payments of +120 days.
Thanks!
I am not sure what you have going on with your credit. Before we look at that, what is it you are looking to accomplish? What are your goals for resolving the debts with Capital One?
I am trying to settle some old judgments from 2010. I have not been able to find the proper number or address for capital one to contact them. do you happen to have any of this info? any help would be appreciated.
You should be able to contact Capital One directly at 877-383-4802 and provide them personal identifiers for them to locate who they have your account with for collection, or who they may have sold the debt to.
Do you know the name of the law firm that sued you?
No I don’t. I thought maybe my credit report would list it but it only says capital one. I will try that number, thanks.
Hi
my english is low please read carefuly
I open up 2006 credit card $500. years later go outside country 2014
after that miss payment cause Charged off
I came back I check up credit report I found it….
so I call them last week they transfer collection
I apology for the miss payment and ask them how to fix the problem..
the lady I talk don’t want to talk , and hear wants to asap hangoff the phone
I try to say something she cut off
keep said no Negotiation ,settlement, reduce , nor after full payment Delete Agreement
credit report she keep said there is only one way full payment right away
right now it goes $ 628 what should I do ? can you advice to me the best way
Capital One is tough to handle on some accounts. The debt collection agencies they use can be tough on small balance accounts like this too.
You never had a shot at paying for a credit report deletion.
You may want to try calling back and offering a couple hundred-ish less a few times and see if they take you up on it. You have to explain your inability to pay more. Make sure you get the deal in writing before you pay.
I have a judgement against me from Cap1 for $1750. The judgement was filed in 9/2010.
They tried to garnish my bank account for the full amount a couple months ago. They were unable to because my back account is federally protected (Social Security Survivor payments for my son).
I live in Nebraska and it says that a judgement can stay on your credit report for 20 years. I would like to buy a house next year. From the looks of things, I will be refused a mortgage with this on my credit report.
What steps should I take to remedy this?
Should I hunt down who, possibly, holds the loan and offer them 50%? Should I contact the courts and see who was the attorney of record and try to negotiate through them, if they are even still around. Should I contact Cap1 directly and find out what I can do? Or should I wait to buy a house for another two years and hope it falls off my credit report?
Ideally, I would really want this all settled in a year so I can apply for a mortgage.
Credit rating 648
Review this page about settling a judgment debt. You will learn what you need to know on that page. You will likely have to deal with the law firm that tried to levy your bank account recently.
The judgment does not stay on your credit report for 20 years, but if left unresolved it will likely prevent you from buying a home for that long.
I have a judgment against me for a Capital one card. It was placed on me by a Texas court in beginning of 2012. The amount of the judgment was for around 5200 however the charges on the card were just shy of 2300. The rest was fees and attorney’s fees. I was going to negotiate it for around 1k as that was nearly half of the original amount but they new law firm that has the case says it is around 12k. I was out of work that could pay my bills for 2 years. I can show them that my budget does not meet my basic necessities. However, I got a little back from taxes and would like to settle for that 1k. How might I go about getting this done. They acted like they did not want to negotiate and I do not want to file bankruptcy for this one item because I would like to purchase well before the 7 years after filing bankruptcy. Can you help?
Capital One accounts do not settle below half the current balance owed very often. That is made less likely when there is a judgment against you.
You can be approved for FHA home loan underwriting standards 2 years after a bankruptcy.
So there is nothing that can be done?
To get them to settle for as low as one thousand dollars? No, not in my experience.
I have a judgement from Cap1 on my CR from 2009.
I have tried relentlessly to negotiate a settlement.
I contacted the attorney that represented Cap1 and he has no records of this judgement. Cap1 has no records and has also issued me an unsecured card. I have tried 3 other law firms that work with Cap on litigation and no one can find any record of this judgement by the docket number or my ss number.
I cannot get this removed from my CR and the attorney who was representing Cap1 in this judgement has no records and refuses to send any letter….HELP PLEASE
Have you disputed this with the credit reporting agencies yet? If you have anything in writing from CapOne or the attorney involved that they have no record of the account, I would use that in a credit reporting dispute.
Have you checked the court record to verify that you are the person fully identified int he original summons and complaint? It may be that the filing lists a similar or identical name, but different address, or other identifier not related to you. That would help you in a credit reporting dispute too.
I would also look to file a credit reporting complaint with the CFPB, but perhaps not until I see the result of any dispute I send to the credit bureaus.
I have a similar situation, where Cap1 and their attorneys have no record of my debt, yet a Judgement lien persists. How do I get the lien removed?
The lien is from a court case and there should be an abstract of it with the county recorder. Get that and use it to confirm the court you were supposedly sued in, and get a copy of the lawsuit that was filed out of that court. Post an update when you have a copy and lets go from there.
Question. I negotiated by phone with a representative from Capital One to settle my credit card debt. I want your advice to cover myself in case they may decide not to act as promised.
I would like to do the pay by phone. I may consider also the payment option.
I appreciate recommendations.
This is what they wrote:
Dear …
I am prepared to offer you a settlement amount of $10,000 (this is not the exact amount but an approximation). If paid on 01/30/2016 by 8:00 p.m. ET, we’ll consider your account paid in full for less than the full balance.
Settling your account will prevent it from possibly being reviewed by a law firm for potential legal action. Please note, no decision has been made to sue you. If a lawsuit is brought against you in the future, you will have an opportunity at any court hearing to raise any applicable defenses or property exemptions.
If you accept theis offer please contact me at the number below to make a free payment by phone. If you would prefer to mail in your payment, write the last 4 digits of your account number on it and include the attached slip. Please allow 7-10 days for mailed in payments to be processed.
If you cannot pay the settlement amount by this date, give me a call. I have other payment options available to you. If your account is being serviced by a third party, your call will automatically be routed to them.
Sincerely,
Name,
Account Supervisor
1-800-272-9756 Ext. xxx-xxxx
P.S. A payment of $10,000 by 01/30/2016 will settle your account.
How much (approximately) is the full balance of your Capital One account?
How many months past due are you?
If you have the money to settle in a lump sum I typically suggest doing so. Paying over the phone using your normal bank account is now more preferred than alternative payment methods.
My capital one issue is not a credit card but instead with Capital One Auto Finance. I had a vehicle loan from 02/2007. Original loan amount was $42,465. I voluntarily turned the veh. In June of 2009.
Currently status on Experian shows: “Account charged off. $10,082 written off. $10,082 past due as of Nov 2015.”
Monthly payment: $0
Terms: 75 months
Recent balance: $10,082
Status Details: “The account is scheduled to continue on record until Sept 2016
On my Experian credit report Capital One has reported every month since March of 2009 “CO” with the latest reporting as of 11/15.
The loan originated in AZ I now live in NV. Both states have a statue of limitations of 6 years so Capitol One can not sue my over the Debt any longer.
I did receive a 1099 form from Capital One in the past and included it in my Taxes. It is my understanding that since the account is “Charged Off” the credit report cannot show a balance owed but instead is supposed to have a zero balance. I am confused/irritated by their monthly reporting. Equifax and Transunion both show similar reportings, however, they both show a monthly payment of $880.00 and the monthly reporting is missed payment. Is this reporting legal or is this a form of “re-aging”?
I am also perplexed on how the report shows Dec 2008 = 30 late, Jan 2009 = 60 days late, Feb 2009 = 90 days late, March, April, May 2009 = CO, and Jun 2009 as the “R” repossession date. Is it common practice to CO and account when it is at 90 days late and three months prior to the repossession?
The account item is currently investigated secondary to a dispute I have filed, however, I am wondering if the final result is the account gets deleted from my Experian report will it only reappear the following month if Capital One reports another month of “CO” for either Dec of 2015 or Jan of 2016?
I had been contacted in late 2009 by Capital One. They were attempting to collect the $10,082 amount. I informed the rep that I had made every attempt to keep the vehicle. I had asked to refinance the vehicle before the Reposession and was told by Capitol One, “we don’t refinance our own loans” to which I responded with, “but I bet you repo them send them to auction and sell them for a bunch less than is owed and eventually come back on us to get the difference don’t you.” I explained to the Rep attempting to collect the $10,082 that I had no interest in paying 10k for a vehicle which was taken from me by someone who wouldn’t work with me to keep it. I told him a $1,500 BK was cheaper than 10k for a vehicle I no longer have. I never filed a BK and have never heard any further from Capitol One.
How should I proceed from this point. Knowing that I can not be sued is why I have decided to dispute this item in hopes of cleaning up my credit score. I am aware that I could wait nine months for it to fall off but why not try to get it handled sooner if possible.
Your advice is greatly appreciated.
Thanks
Dave
It is not the case that a charged off account should only show a zero balance. The charged off balance Capital One is reporting stays until they sell the legal rights, you arrange something else with them, or it ages off later this year.
The monthly reporting does not sound like Capital One is reaging.
Review that link for more about charge off. Lenders can take the charge off account hit early, but it is not a typical practice.
I do see accounts reappear after having been removed as the result of a dispute, and not just with Capital One.
If your dispute results in a deletion it will be an oddity given what you have shared. Nine more months is not too much longer to wait.
I actually can’t file bankruptcy because I don’t have the money. I haven’t actually been sued yet, but I just received a letter from Capital One stating that they are suing me and the papers are being filed with the court.
My income is from Social Security and I am 66. As far as I’m concerned, they can slap a judgment on me. You can’t get blood out of a stone. They can’t take anything out of my bank – there are requirements as to how much has to be left in a bank account before they take anything, and mine doesn’t meet the minimum.
I am presently paying my other bills with my Social Security money but unfortunately I could not keep up the payments with a couple of credit card debts that are the result of a failed business.
I figure I’ll lose in court and they will slap a judgment on me and want me to pay court costs and all I can say is, it’s not happening.
Sometimes it just is what it is.
Do you have any assets, like a home, that Capital One can put a lien against? What state are you in?
New York state, and no, I don’t have a home or car. I presently live with my family, but the house is in my sister’s name. I do have a tiny stock portfolio of about $300 – it was more but I had to sell some of it.
I have received letters from other credit card companies, and two companies sent me documents to answer, which I filed with them and the court. I never received any followup documents or a summons or anything. Each time I receive a letter from a card company, I write and inform them I am on social security – it’s a standard letter.
What I received from Capital One was a letter saying they’re going to sue me and have forwarded documents to the court, which my sister (a paralegal) says is basically the same as what I have received previously from other places. So I am just waiting for the ax to fall on all of these.
You just manage your affairs knowing the creditor and debt collectors are out there. If your situation changes you will want to look at resolving debts. Post an update if you need any feedback about Capital One, or any other account that went delinquent.
You are way ahead of this by being informed, and also by being responsive to the collection process, even when there is no way to resolve the debts.
thanks for all your advice – I will post back if anything transpires – eventually it will. Regards and happy new year.
I want to pay an old debt from capital one credit card. I do not know who to contact because I believe it past to a collections office. Please let me know what I can do.
I would first call Capital One and ask who they have placed the account with for collection, or if they sold your account, who to. If they can resolve the debt with you directly they will, but if they have it out with a collection agency or sold it, they can’t. You would then call the current collector to resolve the debt.
How much is the balance owed?
When did you last make a payment to Capital One?
Post a reply with your answers and I may be able to offer more feedback.
I owe Barclay bank $5941.94, Synchrony bank, 2118.34, Capital One $4772.23 & Prosper loans 5659.00 which was just written off 12/4/15. Do you think I can gat a better rate by negotiating hardship with collection agencies or the banks themselves. I already know what level I’m up to (3 missed payments ea.) I went from full time to part time due to disability & now receiving SSI. Just got a hardship offer in the mail & decided to look up company, NDI in Texas, to no avail and came across you site. Thanks, Looking forward to your response Frank M
Are you looking to set up lower monthly payments or to settle for a lump sum pay off (for less than the balance owed)?
Hi Michael. I have a question regarding my capital one credit card debt. I have a balance of $5548.00 that I haven’t been making any payments on for almost 6 months. I received a letter stating that my account will be charged off by 12/9 and I need to contact them and make a minimum payment by then. I called Capital One hoping they could negotiate with me and lower my interest rate. They said they couldn’t lower my interest rate. They said I would need to pay $988 by 12/9 and then make my normal monthly payments which will get me no where or just make my usual minimum payment of $150 and somehow catch up. The last option was a settlement but it wasn’t good. It was to make 2 $150 payments then the 3rd was $4950 which is basically paying what I owe anyways. I was hoping to pay about $3,000 by February. Is it easier to work with cc company or better to wait until its charged off in 2 weeks? Who will work with me more to pay less and have my cc debt gone?
Do cc companies or the company your debt is charged off to work with you more in paying a lower settlement amount?
Typically settling Capital One accounts will be at the same rate with the bank or with a debt collector they place the account with. Settlements on Capital One accounts do not tend to go below 50% until they are years old, and Cap One sues a lot, so it is better to knock smaller balances down than wait for some better deal that may never come.
Given they are not open to going lower, and your not have the money to agree to the higher amount, the choice to wait and see what you can get a collection agency to agree to is being made for you.
Capital One started selling some accounts again recently. If yoru account is sold you have a chance of settling for less than 10 percent depending on who buys it.
My husband has a capital one judgment against him that was filed in Minnesota back in 2009 for $1200. We are now trying to buy a home and cannot get an FHA home loan due to this judgment and were informed we needed to pay first. I can’t pay until tax time and our lease ends in March. If I pay them in Feb., how soon can this be fixed on my credit report so I can proceed with a home loan? What steps do I need to take? I am terrified we won’t have a home because we can’t continue this lease. Thanks for any help.
I would look to settle the CapOne judgment for 50% of the balance. Be ready for the balance to be more than the 1200 dollars from 2009 due to judgment interest. Most states cap judgment interest, and Minnesota’s is low, but needs to be factored in your savings.
Once you negotiate a deal and pay it you are looking for the satisfaction of judgment to be filed in the court. That can sometimes be a matter of days. The loan officer can typically help push your loan through after that.
I had three Capital One cards all small li mimics 300-700 one Orchard $320, 449 charge-off, Capital One Secure card, closed, with 120 days late.. Orchard was great prior to Capital One, I was paid up on both, when my bank card I used to pay with was stolen and I had some other bumps. Basically they racked up fees on the card, recorded late payments then closed both. Secure is marked closed by customer, which I did not, they bled fees and closed secure card. I called to stop the charge off process with phone rep but they really did not go any ware. I had purchased disputes with both and thought they were both in good standing, until it was too late. Is it possible to send proof of bank holds to get these accounts back in good standing? Who do I contact, the phone reps did not seem to want to assist in the least, but ironically invited me to apply for another. Capital One Card…. This company seems to ruin credit to assure they are the only bank that will steal your money. BoA and other banks wont issue a card or loan. Employment is also impacted as finical institutions and companies partner companies see any charge-off or outstanding account considered a risk.
Dish and Jared also have open accounts I need to address.
Goal
Eliminate Negative Entry – Entire Entry
DISH – Call to “Request Delete Record” Goodwill Letter
JARED – Goodwill Letter- “Request Delete Record”
Captial One – Goodwill Hardship Letter – “Bank Hold Letter” “Reverese Charge-off and Reopen Account”-“In Good Standing”
Captial One – Goodwill Hardship Letter – “Bank Hold Letter” – “Delete Record”
Orchard-Captial One – Goodwill Hardship Letter – “Bank Hold Letter” “Reverese Charge-off and Reopen Account”-“Good Standing”
Orchard-Captial One – Goodwill Hardship Letter – “Bank Hold Letter” – “Delete Record”
Your advice is appreciated, Sean
Did all of this go down with Capital One 4 months ago? What conversations have you had with Capital One up to now, and what were the results of that? Have the letters been the only effort at communication?
Michael,
Went through difficult times (economy, health issues) in 2008-2009. Lost home, savings, 401k, and accumulated credit card debt (2) Cap 1 cards for @ $3300 and $4500., and Chase Bank $4400. After losing home in Florida, moved back to Ohio with family util 2012, when health issues resolved, and I received SSDI. Have since moved back to Florida to retire. All (3) credit cards went to default judgments in Ohio municipal court in 6/2011, as I was unable to address the issue at that time. Trying to ‘clean-up’ some of my credit issues now, so that I can move forward with my life, but between these judgments, and IRS problems for the same period, it is all overwhelming. Tried to make a minimal settlement offer to Cap 1, but only received a standard form letter directing me to call their collections dept to make arrangements for payment.. SOL in Ohio is 5/2018, but afraid that they will only refile. I hate to file BK just to move forward. At this point, I can’t finance anything.
Any suggestions ? Thanks.
You will likely need about half the balances owed on the judgment as of today to have a shot at settling with Capital One. Is that way out of reach? Chapter 7 bankruptcy could run as little as 1500.00. Review this article about consulting with a bankruptcy attorney. It will help you if you go that direction.
If you do determine that settling is the right way to go, than calling to negotiate the deal and then requesting it in writing is the best way to reach your goals.
Hi Michael,
I signed up with LexingtonLaw to facilitate with my credit repair. I recently disputed, rather, requested to CapOne validate debt I’d had with them. I was cognizant I had 2 past accounts with CapOne that I neglected. But part of the default settings for LexingtonLaw is to dispute all negative entries. In any event, the debt was validated by CapOne. They stated the debt had been transferred to a collection agency, for whom will be reporting on my credit, In addition to CapOne verifying and validating the debt, they’ve also decided to report negatively on my credit, as of last week.
I’m trying to do my best to repair my credit and avoid all negative marks by any means necessary. Is there anything I could do to have CapOne stop reporting negatively as they don’t have the account anymore? Any advise would be greatly appreciated.
Regards,
Jay
If your Capital One account is showing accurately there is little to be done other than resolve the account (if that makes sense with your goals and ability).
Did Capital One sell the account, or send it out for collection?
received papers saying I was being sued by Capitol one for a credit card from 2 years ago. The amount is $1150. Should I contact the law office and try and make a settlement and set up payments. I get really nerves over these kinds of situations and don’t want to sound like a babbling idiot. We are in a much better financial situation right now and for the next month could easily make payments of $250. I just want to be done with this in a quickly manner. So I can be done with this stress and back to focusing on my family.
Thanks for your help,
Misty
Can you afford to pay half-ish of that amount in order to settle it for less and be done with it? That is often better than signing an agreement to make several payments over time. It can sometimes mean the difference between having a judgment on your credit report.
I MICHAEL
I reply from other forum.
I have this same problem with cap.one. After settled Now reported closed – derogation outstanding balance but they sent me a 1099C. And I pay as agreed to by both parties. Ihave a letter showing that the account has been settled.. I can prove i made the payment by the date that was set up for the settlement amount . Please help.. I don’t know what to do now.
Are you saying you paid the settlement that was agree to by Capital One in writing (they agree to accept less as payment in full), but they are still reporting a balance due on your credit reports?
If that is what is happening I would file a credit reporting complaint with the CFPB. Please post an update to this comment thread when you know the result of that.
You said to reply here (From the other forum)
Update…
Capital One on my credit report. was paid /Settled less of full balance…… but. it says closed/Derogatory, why?,Should it say Paid (Closed).,??? It was paid by agree settled and they sent me a 1099 which I put it in my taxes…
It is normal for Capital One to show as a closed account and as a derogatory item on your credit reports. Nearly any account that goes without the contracted minimum payment will show as a negative with the credit bureaus. If an account goes several months without payment it will end up closed by the credit issuer.
capital one claims federal law says they cant settle for less then half the balance 150 days old should I wait for charge off
This Capital One debt collector misspoke, hasn’t a clue, or something else entirely. There is no federal law that I know of that prevents Capital One from settling for less than 50% before or after charge off. There is only a Capital One rule that prevents the collectors accepting less than half the balance as a settlement.
Why are you under the impression that Capital One will settle for less than half?
Hi Michael,
I talked with Capital One via phone today regarding Debt Settlement. I have not made payment since, 11/25/14, called today to negotiate. They first offered 65% then went to 50%. Financially, I would love to try for 40% as financial times are very hard for me at this time. I am getting money from family as is now to repay this. My balance is 18749.40. I am sure it was $17K+ at last payment. So there are fees and interest added I suppose? Is this okay? They wanted to settle on phone and then mail me agreement. I would prefer to have agreement faxed before payment on phone. I would prefer to pay with a cashier’s check via mail, so they don’t have any account info. I have read everything you have written multiple times. I am so afraid I am leaving something out and will not be free of this debt. I also know I am going to be liable in taxes for the difference in the settlement. Do you have any idea of what percentage I can expect to pay for that difference? i was thinking 30% minimum. I also didn’t know if I was only liable for Federal taxes or state also? I know you are not an accountant, but thought maybe you had experience to answer this? I am scared to death I am going to miss something! I do have access to a fax machine. I thought if I paid by a debit card via phone, I could then cancel that card and request a new one (bad idea?) Michael, I want to thank you for this website. Your info has been so valuable to me. I appreciate any advice you can give me to get rid of this forever and if you have any idea what my tax liability is in $ amount on the forgiven debt. Also, if I should/could pay early in payments in estimated taxes. I have read you settlement documents. They are dated 2013 and I was afraid maybe some things had changed since then. Sorry to ramble. Thanks again my friend!
The fees and interest added to your original balance can be traced back to your agreement. Most often you see monthly late fees of around 35 dollars, possible over limit fees of 40-ish dollars, and starting in month 3 of missed payments, upwards of 30 percent default interest.
The inflated balance is normal.
Today’s trends are still for 50% settlements with Capital One. Holding out for 40 percent is only something I would do if you just have no way to come up with the extra money to settle for half.
I do sometimes coach people to accept the settlement and set up payment over the phone, but have the payment date be a week or 2 in the future, so that the settlement letter from Capital One has time to get to you. It is also why I prefer folks use a different bank account to pay the settlements with. That way you only transfer the money to your special settlement fund when everything is in order.
Having said that, I also encourage you to call Capital One and record the phone call. Tell them you are recording and why. Cover all the details you need to with them, and save that recording until you get the letter, and then still keep it saved. If anything goes wrong, you have all of that to back you up in your complaint to the CFPB that should result in a pretty snappy fix from Capital One.
In other words, all the fear and risks of yesteryear about paying settlements and dealing with legitimate debt collectors, while still valid, are not the worry they used to be.
You may not even have a tax liability from forgiven debt. Read through that critical report and use some of the IRS docs I link to, or create your worksheet full of assets and liabilities. That should give you a good clue of how much you may owe in taxes next year. If you pay a state income tax, that could certainly become part of the equation, but you should talk to a tax pro once you have all your figures together.
Nothing about our current discussion has changed much since 2013, other than the CFPB has since further proven they are great advocates for consumer if you experience any Capital One snafu, payment or otherwise.
Thanks so much! I’ll update if I have any info that might help others.,
I have an account with capital one that was charged off 4 years and 8 months ago. They are reporting EVERY month a $1,744 balance on a card that had a $500 limit. The charge off amount is showing $1,471. There was never a judgment filed on the account. I offered a written settlement, and they wrote back asking me to call. When I called, they only stated that they could not offer a settlement, and that they were not currently actively collecting on the account. They also stated that a 1099 had been sent (which I have never gotten), and that any payments made would be strictly voluntary. I inquired about what the balance is, and what amount was forgiven, and was told that information couldn’t be disclosed, just that any payments made are strictly voluntary. This is the ONLY negative on my credit report, and It is absolutely killing my score due to showing that the credit limit is exceeded. What is my smartest and most reasonable plan of action?
Capital One being the only negative on your credit report, and being that it is nearly 5 years old, it should not have that big an impact on your credit reports, unless your reports are thin to begin with. How many accounts are showing on your reports total?
Hi ,
Capital one took me to court through a 3rd party collection agency and loss. The court dismissed the case with prejudice but they just sent me a 1099c for cancellation of debt. Should I have received a 1099c for a case that was dismissed? If yes, is this taxable?
Thanks
If the debt was yours, yes they can send the 1099c. The courts decision would not preclude Capital One from following IRS guidance on cancelled debt.
Cancelled debt is considered income for tax purposes, but that does not necessarily mean you would owe tax on cancelled credit card debt.
Thanks for your reply.
So they used a 3rd party collection agency to take me to court, they loss because they could prove the debt was mine but I have to pay taxes on debt that the court through out? Please clarify how this 1099c is valid? why would I pay taxes on this if the debt wasn’t determine in court to belong to me?
If I fill out the insolvency for, wouldn’t that reduce other credits that might already be given credit for?
Did you have a Capital One credit card that you used to make purchases for goods and services?
If you did, and you failed to pay the principle balance owed that was in excess of 600 dollars, the IRS considers that income if it is cancelled/forgiven. The link in my comment immediately above provides more details. You would want to talk to a tax professional about how the insolvency rule will apply to other tax credits.
Hi Michael,
I had informed Capital One that I could not pay on credit card debt until a future time because of extenuating financial circumstances. It was my intent to resume contact with them when I could get my head above water to pay on this debt. To my surprise I received a 1099-c in January of 2014 cancelling $5,223.59 of the $6,415 credit card debt on 12/31/13. I dutifully filed the 1099c with my 2013 federal income taxes as income and paid appropriate taxes on this amount. I, like everyone else was shocked to see that that are reporting my account as charged off to the three credit bureaus but also reporting that I owe $6,514. I have done the appeals with the credit bureaus and had the account corrected but of course the next month it is showing that I owe $6,514. In fact, I spoke with a representative (devil’s advocate) with Capital One and had a go around with him about the unfairness of this punitive practice. I knew this would happen when I told him that Transunion was reporting zero owed on the account and how can Experian and Equifax reporting I owed $6,514. Of course he made sure that Transunion now reports that I owe $6,514 as is also shown on Experian and Equifax. So he obviously didn’t like me challenging him.
My question is that is it worth negotiating with them to pay on this account and have them send a corrected 1099c? I want to improve my credit score and this keeps knocking it down. At the same time I don’t want this ruthless corporation to get away with writing off my debt to reduce their taxes and at the same time have me pay taxes on my debt.
Thank You, Robert
How long ago did you stop paying Capital One?
What state are you in?
What credit and financing goals do you have in the next, say 3 years?
I stopped paying March, 2011. State is Pa. I am aware of the 7 yr. rule for it to fall off reports. I’d like to look at getting a VA Home Loan this year. Capital One knocked my Transunion score down from 660 to 638 and my Equifax score from 678 to 613. I had filed a correction with these two credit bureaus to change the amount to zero, which they did. Capital One came right back and reported that I owe them $6,415 to knock the scores down. I am thinking of filing a complaint with CFPB.
Read this pending IRS rule first: https://www.aicpa.org/interestareas/tax/newsandpublications/taxnews/pages/20141014.aspx
Do you know any seasoned mortgage brokers that do VA loans? Talk to them about how underwriting will view the CapOne balance being reported as owed, but set beside the 1099c that they sent you, and that you included in your tax calculations this year. It would be great if you posted an update with what you learn.
Thank you for the advice. I will have to do that. I just got off the phone with Capital One and offered to pay $1,291.08 to settle as agreed which is the difference between what they are reporting to the credit bureaus and what they reported to the IRS as cancelled debt—-$6,514.67 less $5,223.59. They told me it would be a voluntary payment and they would keep reporting the balance owed after the payment. Unbelievable how rigid and when you think of it, stupid a company can be. So they lost out on the proposed payment because they won’t list it as settled as agreed. I said why would I pay they all the money back when they got a tax write off and I paid taxes on the cancelled debt. Is this corporate arrogance or corporate indifference or both?
With Capital One I want to say both, but really it is a convoluted tax/accounting system; combined with what are not so bad systems for collection and credit reporting; that all combine into what you have happening to you.
Capital One has two judgments against me from several years ago. I am trying to secure a mortgage, and need to pay off the two judgments (hopefully at the judgment amounts of $1000 and $1200 and not with court allowed interest added). I have contacted several numbers for Cap One, and kept getting transferred to other reps in other depts. final told me to call a toll-free number for a national network of attorneys who work for Cap One, but the number they gave me was defunct. How can I reach someone with authority to negotiate and accept payment from me? Also, my credit report shows both the charge offs of the two accounts as well as the two public records of the associated judgments. When I pay the judgment, will the CO and the judgments both be updated? Thank you for your kind advice.
Once the judgments are paid they can be updated to show as satisfied on your credit reports. The Capital One charge offs on your credit reports are going to still show up, but they will be resolved too.
When were these judgments entered in the court?
Who was the collection attorney working for Capital One on each account?
Update: called the collection attorneys for the two judgments, Blatt Hassenmiller. They claim only one judgment and would not negotiate, so will pay in full. They have no record of second judgment, say that account was sent back to Capital One … But Cap One already told me both went to judgment and I have copies of court records for both showing Blatt Hassenmiller as attorney for each. Now what? The judgments are from 2011 and 2012. What do I do about handling this second judgment when no one claims to hold it? How do I get it off my credit report or marked as satisfied? Again, I’m willing to pay it. Thank you for your guidance!
It is unlikely you will get either of the Capital One Judgments off of your credit reports. But getting both of them to show as satisfied and paid will open up your home loan opportunities all the same.
You can pay the second judgment off to the court directly. You will want to do this in a fashion that results in the quickest update to the court record. Talk to the court clerk about how you can accomplish that on Monday. If need be, hire a local attorney to make sure all of this is done correctly.
I have 2 capital one accounts which have not been paid since September because my husband is laid off. The balances are $1790 and $560. We just reviewed a small tax return and want to pay these off but can’t afford all of it. I called 2x and asked if they would settle for $1500 total and they both replied we don’t settle accounts, which I don’t think is true. What can I do?
At this stage you may be considered about 5 months late. If that is accurate, you have another month before Capital One would typically charge off your account and send it out to third parties for collection. Try negotiate anew a week or two before they see you as 180 days late. You may also find that your accounts are just not going to get settled directly with the bank, but can be with a debt collector.
Do the balances owed consist of balance transfers, cash advances, or are largely made up of charges that were made in the few months leading up to payments on the cards stopping?
Capital One charged off two of my accounts in 2008. They have sent the IRS and me a 1099-C indicating the debt was cancelled in 2014 and I must include the amount they are reporting as cancelled as income. I called the disputes department advising them they should have reported it in 2008 not 2014 and they are refusing to correct their mistake. I even quoted the Internal Revenue Code section 166. I am going to send my request to them and writing (certified mail) stating to correct the mistake within 4 weeks. I am going to file a Form 8275 with my taxes explaining their error if they still refuse to cancel the 1099-C
Anyone else having this issue with Capital One?
Capital one recently charged off my account in jan. of 2015 and “sold” my account to portfolio recovery llc. I contacted this collection agency and paid off my balance in one payment. I am in the process of getting a home and my lender tried to get my credit rescored after I had paid off this balance. The payment confirmation from portfolio recovery was rejected because it did not come from creditor (capital one). When I contact Capital one they refuse to talk to me let alone help me. I am not trying to remove the account I want the balance updated. Portfolio recovery says they will update to the credit bureaus in 4 to 5 days but they are not even listed on my credit report presently. So presently my credit report is showing an outstanding balance being reported by capital one that i have already paid to the collection agency they told me were servicing my account, and I can not move ahead with my loan until i get my credit rescored which I cant do without a letter from capital one. What can I do? When portfolio recovery updates to credit bureau will my balance change to paid?
If Capital One sold the account, it means they have no legal right to it, and should also update their credit reporting to show a zero balance owed to them, as legally, nothing is owed to them.
It looks to me like you caught all of this mid stream, and you need a week or three to let the credit reports update.
If you want to be very proactive, file a credit reporting complaint with the CFPB against Capital One. You want to provide the same detail you did above about this specific account, but probably want to be more detailed with dates and times, names of people you spoke to, etc.
You can file the complaint here: https://www.consumerfinance.gov/complaint/
Hi Michael,
I opened a CapOne acct in 2008 and in 2009 was laid off and could no longer afford the payments. My credit limit was only $1500. Now that I am older I realize that I should have paid attention to the fact that I was paying for some sort of protection plan in the event that I lost my job but in the thick of things at the time it didn’t cross my mind. I stopped paying them and my balance is now $2118 according to my credit report. They recently sold the debt to Calvary Portfolio who is now also reporting the $2118 debt on my report. So I not only have a balance with CapOne I now have one with Calvary as well. I am unsure of what to do about the debt at this point and if paying it would even make a difference for my credit score. I believe I stopped making payments at some point in 2009, but I really don’t recall. I would like to get a mortgage this year and don’t want to find myself in a corner because of this debt. So my question is do I pay or not? Thanks for the advice.
Is Capital One still reporting a balance owed to them on your credit reports? Now that your debt has been sold to Calvary Portfolio, Capital One should show a zero balance owed then, as they no longer have a legal right to collect anything.
From what you shared, Capital One and Calvary Portfolio will fall off your credit reports sometime next year, or in the early part of 2017. If you are looking for a mortgage before these fall off your credit, it is likely that the unresolved debt would hold up loan approval.
What state are you in? If the SOL for Calvary to sue is passed in your state, you will sometimes find you have an easier time with negotiating an affordable settlement.
Are you able to fund a settlement you negotiate right now, or do you need time to pull together the money? If you do need time, how much?
Thanks for the quick reply. I live in TX and unlike many others on this forum I do not have a judgement against me so I assume the SOL has passed for Calvary to take those steps. It does appear that the balance of the CapOne accounts on all of my reports now reflects $0. I can fund a settlement, but didn’t want to do so if it will not be advantageous. What is the appropriate percent to request to settle?
Call Cavalry and start with an offer to settle for 20-ish percent. Be ready to go up a bit if need be. It is okay if this takes several calls to get a deal done. Go as high as you can afford to pay, and want to.
Use some of the negotiation tips and settlement timing cues I cover on the site.
I would try to have this settled within several months of starting to work with a mortgage broker or loan officer. Do you know what your credit scores are now?
I should have added that the SOL to sue in Texas is 4 years. That means the collectors on this account have no teeth, just bark. Do not let on anything about your credit reports or home loan goals. You wanting to get something done, more than them wanting to accept some form of settlement, gives them too much information in your situation.
My score is at 638 right now and I only have this negative and 1 other which is only $650 so I offered a settlement on that one. I will see what they are willing to take and hope they will list the balance at $0 after the settlement is agreed upon. Is there something specific I should look for in the agreement to ensure I am covered?
Read over the last two critical reports about settlement letters and taxes on settled debt.
Calvary will generally do okay with updating your credit reports to show that you no longer owe anything, once you pay the settlement you negotiate. They have to only report accurate and current information. Give it 6 or so weeks after the fact, and check your reports. If they did not update, post about that here and I can help you from there.
Thanks Michael!
Why would u remove my question on the 1099c
I moved the comment to the post about 1099c’s on forgiven debt. I did refer to this article in my most recent comment reply to you over on that page.
My father recently passed away and my 83 yr old mother is now living on Soc Security income of about $1300 a month. My brother and I are helping her get control of her finances. She did get a little money from dad’s life insurance and will draw on that to help pay for home health care until she has none left. She has a Cap 1 credit card balance of about $8000 dollars. She has not made a payment in about 45 days. We called Capital One today to try to work out a reduced debt payoff. She can probably use about $4000 of my dads life insurance money to pay off the bill. They said no way – we wouldn’t be able to pay less that the $8000. We don’t know what to do? Don’t make payments for a few months and the call back and try again? She does own her home ( has a reverse mortgage) but doesn’t have anymore assets. Any advice? Thanks!
Your settlement effort with Capital One is way too early. You can wait another 3 to 4 months and try again. Keep that 4k powder dry until then. Post an update when you next call Cap One to negotiate, or if you hear from third party debt collectors.
Hello,
In 2010, I disputed a late fee charge on my Capital One bill. I did not know then what I know now. I continued to pay my Capital One card, including the fee. Capital One reported this dispute to the credit bureaus. This week, I paid off this Capital One card in a lump sum, it was not a charge off.
I am applying for a home loan, and cannot get approved with the dispute on my credit report. When I called Capital One, they would not provide any dispute resolution information as they did not have it on record. When I inquired about this, as it is their company, etc., I was told that 2010 is too late and I would have to write in. I have approximately 3 weeks to remedy this issue and don’t know where to start. Of course, it’s a secret who I would contact other than unhelpful customer support guy I just spoke with.
Help? If I can’t get this dispute, which is now a card with a zero balance (closed) off of my credit, I cannot get approved.
Thanks!
Who is your lender, or mortgage broker?
Hi Michael,
Thank you for such an informative site to help people through difficult times.
I have a Capital One card at $20,000 and a Discover card at $15,000. I have had both for about 10-12 years. For the past 5-7 years, I have only been able to make minimum payments. The Cap 1 card was not paid for November 2014, but the Discover was. When the banks were in trouble they arbitrarily raised my rates quite high, although my credit was very good.
I have pretty much been unemployed for 5 of the last 7 years (film industry where I earned $10,000 a month, hence the limits allowed) and have just now depleted all the money I had in an IRA that I’ve been using to pay bills over the years. Because of those withdrawals, with taxes and penalties, I owe the IRS $18,000. I started paying $400 installments in November.
Because work was so dismal, I elected to take early retirement at 55, starting in December, I will only receive $2100 a month. I know I can’t swing these payments, and would love to settle these two cards (only ones I have) In Feb/March, I will have a retirement type IRA available with $175,000 that I can access. (with even more taxes and penalties)
I don’t want to file bankruptcy, and would love to get rid of these. I want to sell my house and move out of the country within a year and don’t want these over my head.
Reading your site, should I let them get passed due 5-6 months (I can’t pay them anyway) and try to settle? Should I do all negotiations over the phone? What is a realistic starting point on my end. I would love 40-50% and could withdraw the money immediately to pay them. I have no car payment and intend to sell it, and my mortgage is being re-worked and will be about $1000 (1st and an equity line).
The IRA is my only source for this cash. Should I tell them that?
Thank You so much for taking the time to help me.
Jeff
Your best opportunity for settling with these two creditors is typically going to be between 150 and 180 days late. So… missing your credit card payments for the next several months is both baked in the cake, and a necessity to get to where you will be able to negotiate settlements.
I highly recommend doing all negotiations over the phone, and relying on things in writing to finalize the agreements you negotiate.
Both of your creditors do not rank high on how low they settle. You can see how I review them, and the realistic expectations I suggest people have here: https://consumerrecoverynetwork.com/review-top-7-credit-card-lenders-best-offering-debt-relief/.
40% settlements with Capital One are not common at all. I see those too seldom to suggest them as targets to hold out for. And the same goes for Discover.
I would never discuss that the lump sum money to settle was coming from an IRA. I would simply say “I have been out of work for years. I ran out of savings, and simply could no longer afford to pay my cards. I have one single resource that is, thankfully, available to help me fund a pay off, but only if it puts the account to an end. I cannot hit them up every month for payments”… or something along those lines.
You are welcome to post here and on the other pages for feedback along the way.
I received notice yesterday that I am being sued by Capital One for almost $1,900. I know I need to respond in written form to my local court. What do I need to put in that response? I don’t think I have made a payment on this account in several years. According to the paperwork it was charged off in December of 2013. I tried to come to an agreement with Capital One back when we started having financial troubles but the payments they wanted were way too high for us to agree to. So I ended up doing what I should not have and ignored letters and phone calls to now be sued. I would like to pay them back. But can only do so much a month. We might could do $50 a month to get it paid off. But more than that would be absolutely be a stretch. Several years ago I was able to settle an account with discover and have been making payments on it of $46 a month for several years now. I was disappointed when Capital One would not work with me.
Each bank will handle account resolution differently. Capital One has its flaws… they all do.
I do not thing the collection attorney for Capital One is likely to accept 50 dollars a month at this point. But they may once you get involved in the court process. They may have little choice, depending on your state, your exemptions from garnishment and bank levy, etc.
What state do you live in?
What shot do you have a pulling half the amount of the lawsuit together over, say the next 6 months?
Hi Michael:
In 2010 we settled our charged off account with cap 1 with a poa through through their attorneys hunt & Enrique’s. We have proof from the servicing company that all payments were made and on time. We are in the process of buying a home and the credit report we received shows nothing completed. We have been monitoring our credit reports for quite some time and it has never shown up before.
I called cap 1 and was told that they have our last payment as returned nsf. In the same phone conversation, she stated that they had sent the irs a 1099 for that year for over 10,000. I am sending everyone, including cap 1, attorneys and all 3 credit reporting agencies copies of our documentation showing paid as agreed which includes banking information certified return receipt with a letter to at least get the settled in collections. Is there anything else you would recommend?
Thank you
If the payment Capital One is saying was NSF, is something your bank records show as being paid on time and not returned, I would include filing a debt collection complaint with the CFPB. I am finding that debt collectors, and banks like Capital One with issues like yours, take resolving them much more seriously when the right people in their organizations are getting this stuff put on their desk, which is more likely to happen when they hear about it from the CFPB.
I have recently gone through a hardship with being diagnosed with a pancreatic tumor and losing my second job ($1000.) I have 3 unsecured debts: 1-discover personal loan $11k, citi $11k, and capital one $10k. After explaining my situation to discover and citi, I have been set up on programs to pay off my debt. Capital one, however, will not offer any help or programs. I’ve called several times over the last 3 months-not paying any amt on account, but they will not help at all. I can afford to pay them $200 a month but this does not meet my min payment obligations and my apr is at 19% now. Should I pay $200 even though my min payment is $368 and I owe over $1k right now? Or do I just continue to not pay and hope they will eventually offer a program or settlement?
Can you pull together roughly 5k to settle with Capital One within the next 3 months? If not, how much longer than that will it take?
Sending Capital One a payment for less than the minimum required will not prevent your account from hitting their collection pipe line in a few more months (where your goal at that point would be to settle for less). If it were my debt, and that is how things were going to progress, I would not waste the 600 dollars (3 months of 200 dollar payments), as that is money that could go toward my settlement.
Will Capital One relent and set you up with a hardship type repayment plan like your other credit cards? It is still possible. Have you connected with a credit counseling agency about getting the same thing accomplished? The national average payment with counseling on debts like this is 2.1% of the balance. That puts you real close to the 200 a month you are trying to get CapOne to accept.
I am not 100% positive that I can get the 5k in the next 3 months, but I do feel pretty positive that I can.
I haven’t connected with a credit counseling agency. I have just been trying to talk to my creditors on my own and explain my situation. So far, everyone has been extremely helpful and has been willing to work with me with not hesitation, but I had to miss a payment on the accounts first. Capital One is the only one that is not willing to help me at this point.
Do you recommend a particular credit counseling agency? Also, will they work with me just on the capital one account, since I have already set up and agreed to payment plan programs with the other two debts.
I am not sure if Capital One will accept a DMP proposal from a credit counseling agency if your other accounts are not part of the same repayment plan. Each creditor has there own policies for these plans, and they do adjust them, and even make exceptions. While Capital One is not as flexible with some of their collection and recovery policies, they are, last I knew, one of the best larger credit card banks for allowable discretionary income when your accounts are part of a credit counseling program.
There are many credit counseling agencies that can help you look into this further. You can reach one at 800-939-8357, and press option 1.
If you are going to be able to pull together half of the balance owed quickly, I like settlement too. Whether you can settle direct with Capital One right before charge off, or end up settling with the first collection agency to get the account, in say 4 to 5 more months, keep your money at the ready. If settlement is where this heads, take some time to read the last few critical reports I have listed here: https://consumerrecoverynetwork.com/debt-relief-program-reports/
I wanted to give an update on my post. After 6 months of calling and trying to get some type of help, I didn’t get any until the account was charged off. Within days of the charge off, capital one called and offered me a settlement of roughly $5,000. I was able to pay a lump sum of $3,000 and am now continuing to pay $150. monthly until the remaining $2,000. is paid in full.
Nice work Jennifer! Be sure to make all of those monthly payments on time. Was your deal negotiated directly with Capital One, or were you called by an outside collection agency?
It was directly with Capital One. I’ve set-up automatic monthly drafts with them to ensure payments are made on time. Thanks for your help and advice; it was greatly appreciated.
Thank you for the information. That is helpful. Yes I can keep it up as I had been doing. But when I went this summer to get a new car, my credit report showed that it had been charged off and I was told by the finance person at the dealership that based on that, I was silly for paying them any longer. I guess I was just silly for listening to advise from someone that really has no clue. I do not have other accounts in collections but I do have another card that I have been paying for about the same amount of time and continue to pay monthly. ($7,500 remaining). That account is closed but has not been listed as a charge off. The credit reporting hurts though because I have a negative credit since there is no available credit on the card. In addition I was imposed a $24,000 IRS tax and penalty a couple of years ago for errors I made (my fault) on my 2009 tax return while going through a divorce. I was able to establish a payment plan with them. ($11,500 remaining). So total is around $29,000 on these 3 items and I have been paying on them for a good 3-4 years and knocked about half of it off so far.
So I guess my bottom line question remains. Do you think I can get back in good graces with Capital One AND eliminate the hassles I’m beginning to get from First Source by reinstituting the $250 per month to them? I do (did) it on line by the end of each month.
Thanks for your insight Michael!
How much is it that you owe on Capital One debts total? Is First Source collecting on all accounts if more than one?
Yes, you can set up payments with First Source. But they are going to try to set them up so that you are paying more than you were before. You will have to stick to your guns if that is all you can pay.
I know you mentioned in an earlier post that you have no shot of offering a lump sum settlement, but I cannot help but point out that First Source is authorized to settle with you, and for perhaps half of what you owe CapOne.
Michael:
I accumulated debt with Capital One that was quite extensive and have been paying monthly since 2010 an amount of $250. However, the debt remains at $10k and I have found it difficult to make the monthly payments. My last one was May 2014. I am now receiving phone calls from a company called First Source Advantage trying to collect. They actually contacted me at work today, which I have no idea how they got this number. In any event, I am not sure what to do at this point. I thought that since Capital One had already “charged off” the debt some years ago, that maybe discontinuing payments would not be an issue. But I think I may have been wrong since I am starting to get calls from First Source. After reading through all of the above comments and responses, it sounds like I am going to be getting sued or something of that nature for the balance. Am I correct that this will most likely occur even though it is a charge off? Should I attempt to begin paying the $250 per month again or is it too late to do that to get First Source from bothering me? Like alot of people I have gone through some hard times financially and still face a few more years of recooping from it and in no way will I be able to pay a lump sum, whether it be through a possible judgement or settlement. I guess what I’m trying to figure out is if I should start the $250 up again or not.
Thanks.
Charge off is just an accounting principle that banks must follow when accounts go unpaid long enough. Your debt with Capital One remains as collectable after charge off as it was before that. And will stay that way until you pass the time limit set by state law for how long you can be legitimately sued.
Capital One does sue. And they are now selling more debt once again.
Before you look at starting up the 250 dollar payments again, is that affordable? Are you confident you can keep that up? And what about other bills? Do you have other accounts in collections,or that you continue trying to pay? If so, how much do those balances all add up to?
Hi Michael,
I have a charge off on my credit report from Capital One from 6/09. I have a docket # from when they sued me. I am trying to purchase a home and my mortgage company is stating that the only thing that is preventing me from purchasing a home is this charge off for $3,191. My credit score is a 613 and I have no other delinquencies. What do you suggest I do? I have no documentation of this ever going to court. Thanks for your help.
Do you have any hard dates set with a transaction for a home? If so, when?
Michael I have 2 charged off accounts with Capital One that are both 1 year out from their SOL’s expiring and both will fall off my CR’s in 4 years which are $1687.40 and $1317.36. A month ago Northland Group on the behalf of Capital One presented me an offer by mail to settle for 45% of the $1317.36 so I figured I could probably get the same deal for the $1687.40 since they were handling that account as well. A couple of weeks ago while looking at my CR’s I noticed the account for $1687.40 had a zero balance and figured they had sold the account to a debt buyer so I put in disputes to force them to update reports with the name of the DB which they did and it is MCM. I did this I would know in advance who I would be dealing with. So I finally received a letter from MCM yesterday stating the typical info about them acquiring the debt from Capital One. Initially I was prepared to pay both debts with Northland understanding that my CR’s would be updated to reflect being paid and would of course still be on my CR’s for the next 4 years since I knew getting a PFD from Capital One would be next to impossible even if I offered to pay the amounts in full. But now that the debt has been sold I think I might have a better chance of negotiating a PFD with MCM since they outright own the debt. My questions to you are:
1) Although an MCM collection account isn’t listed on my CR’s is this something that they can legally do.
2) If I am able to negotiate a PFD with MCM, since they own the debt are they able to have the CapOne trade line deleted or would the deletion only apply if they had their own account listed on my CR.
As always Michael thank you for dedicating your time to answering my questions and all the info you have provided on your site. It is very much appreciated!!!!
Midland Credit does currently offer to not report the newly purchased debts as collection accounts at all if you resolve debt with them soon after they obtain your account. This is obviously a huge benefit. You can call them and see if that applies to your situation. This is not a pay for delete. There will be nothing from Midland to delete, as you acted quickly enough.
Midland Credit, nor anyone other collection agency CapOne sells to, or works with, can cause Capital One to delete anything from your credit reports. In fact, due to the fact that Capital One sold your account to Midland Credit (who you can prevent from showing on your credit at all), your credit report will be better off than if you settled for less than the balance owed directly with Capital One. And that is because Capital One credit reporting, when you settle debts they still own, will often still report the remaining balances owed, in the same manner as the original article above points out.
Thanks for the response Michael. So if I act in time to prevent MCM from appearing on my CR’s then is it safe to assume that Midland will be responsible for updating the Capital One account to reflect it’s paid status. What are your thoughts on what language I should ask them to use to update the account with?
Your Capital One account will likely show a charged off and zero balance owed status until the account ages off your credit reports. You cannot realistically expect much better than that based on today’s credit reporting realities. All things considered, if you resolve outstanding debts, continue to pay current accounts reporting on time, all the time, and make smart rebuilding decisions, the Capital One late pays will not hurt all that much 12 and more months from now. But do try to prevent other collections from showing if you have the budget bandwidth to do it.
Understood, thanks. Now that I’m dealing with a CA and not the OC what do you suggest for the minimum and maximum I should offer on payment of the balance?
Generally I would target between 40% and 50% settlements with MCM. It will also depend on how collectable you look to them. The larger the collection agency, or debt buying company (and Midland is quite large), the more sophisticated collection tools they will use. Settlement percentages are a moving target based on each persons details. There could be 10, to more than 100 factoring data points used, all the way down to the affluence of your zip code perhaps.
When it comes to negotiating settlement amounts, the more you look like someone in financial hardship the better
Thanks Michael.
Hello Michael,
I hope you can help me. I currently owe Capital One $852 on an original amount of $500. My last payment was made on 8/2011. Capital one is still reporting it on all my credit agencies, however I have received letters from ARS National Services Inc since last year (one of which offering a settlement for 55% back in May of this year). ARS does not appear anywhere on my credit report.
I finally have mustered up the courage and finances to tackle this on. I sent a debt verification letter to ARS and received a letter back from Capital One verifying that I was the owner, when they received the application, when it was opened, date of last payment etc. There are three boxes below that and one is marked stating the following:
“We have placed a disagreement code with a resolution of dispute on your credit file to the major credit reporting agencies”
It does not mention ARS at all in the letter from Capital One but I sent the debt verification to ARS. I want to find a resolution to this; my questions are as follow;
1. What is my best option to go about this?
2. If a settlement is the best option is there a sample letter you may share that has correct verbiage?
3. Should I even address ARS anymore or deal with Cap 1 directly?
4. Why is Cap one still reporting still reporting to credit beaureus (last date 8/3/14) if it is a charge off ?
5. How does SOL work regarding dates provided, I reside in Florida? Would this apply since they are reporting to my credit bureaus
I have read on previous posts here as you mentioned that PFD’s are becoming an urban legend and that cap 1 is tough to work with. In all honesty I just want to find a resolution and put this all behind me. I appreciate you taking the time to read this and help me. Thank you again.
ARS National Services is likely collecting on behalf of Capital One based on contingency. When an account is placed with a debt collector, like your is,you typically have to deal with the debt collector to reach your goal of resolving the account.
Your best option at this point will depend on what your goals are. Settlement is one option. Ideally you would want to have all the money to pay the amount you negotiate in a single payment. With the prior ARS offer, you know you can target roughly 50% of today’s balance in your negotiations (that is on target with what I would shoot for based on today’s trends with Capital One settlements).
I do not recommend letters be used to negotiate. They are often ineffective, and have had an unfortunate back firing affect with many creditors for years now. I would encourage you call ARS to negotiate a deal, and get them to document the agreement on their letterhead. Get that written deal in your hands prior to payment.
Some resources for you:
Negotiating with debt collectors.
Getting your settlements documented.
Capital One will continue to show on your credit reports for as much as 7.5 years from the date you stopped paying them. That is perfectly normal, and charge off does not change much of anything about your debt. It does tend to be when creditors subject your account to different collection policies though. Here is more about charge off: https://consumerrecoverynetwork.com/charge-off-and-credit-card-debt-what-it-means-to-you/.
If you want to put this behind you, and can afford to pay half of the amount owed, I would encourage you to review the links above, and negotiate a settlement with ARS. Your letters may have triggered some things related to how your account will be handled, so post about any thing odd.
Michael,
Thank you for your speedy response, links and your time, an I will most definitely keep the board updated. Yes i can afford to pay at least half of that won’t be a problem. I do have a few follow up questions.
Should I contact ARS even though Capital One responded to the debt validation? Or should I contact Cap 1 directly on the phone number provided on the letter?
Although Cap 1 can show up to 7.5 years- is it normal for them to report monthly to my credit bureaus as a C/O even though it’s already charged off?
If you recommend I contact ARS instead of Cap 1- the last letter they sent me for the 55 % settlement amount was in May of this year. Also the verbiage that was used from ARS in the May letter states “Upon receipt of cleared funds, ARS and our client will consider this account either paid in full or settled based on the options chose”
Given your original post on this page about verbiage used from creditors once the dust has settled- What do you think is the best case scenario as far as how Capital One will comment on my Credit Bureaus once I have settled either directly with them or through ARS? How do you believe I can get that result. That is one of my biggest concerns.
On the assumption that I am dealing with ARS what verbiage should I require from them to show on my credit bureaus ? Do they even have control over that? On the assumption once again I am going through ARS once I call them to see if the 55 % settlement is still available, should I have them send me an updated letter with a current date?
I know I have a million questions, but again I appreciate your time, I just want to put this all behind me in the best way possible. Thanks again.
I would contact ARS directly to negotiate. They may tell you the account got yanked. I would then call Capital One to negotiate a deal, or learn where they placed the account now. Did your debt validation request also contain wording to the affect that they cease communicating with you?
If you mean Capital One is showing a fresh charge off each month, no, that is not normal.
The original offer verbiage is no longer in play. You need a new letter. They may never send one again, so you would instigate that with your call to negotiate the pay off.
Capital One should report the account settled, paid for less, or even just paid. That is not the problem with them though. The problem with Capital One credit reporting is that they will still report a balance owed after the settlement is completed, when everyone agrees no balance is owed. And this skews your DTI (debt to income) for other credit purposes, and is false reporting too. If this were to occur, post an update and I will have some action steps to suggest.
ARS is not showing on your credit reports now, and would have no control over how Capital One will show on your credit. And you will absolutely want an updated letter with a new date on it.
You can post as many questions as you like for additional feedback 🙂
Michael,
Thank you again. To answer your question, no there was not anything stating to cease communication on the debt validation letter, it actually gave a number at the bottom of the page to call them with any questions. (Capital One letter head). I would assume as recommended to still contact ARS rather than Cap 1 directly?
Regarding how they are reporting, on my CR it shows under “Date Reported” as 8/3/14 and the date updates with every month that goes by. Is it normal that the date reported date updates every month that goes by even though my DOFD is back in 2011?
Under comments it stated “Charged off account, Account closed by credit grantor”
Thank you for your continued help!
Best Regards,
Julio
Sorry Julio, I meant did your letter to them request they stop calling, or some other verbiage that could be interpreted as your requesting a limit to communications.
Yes, I do suggest contacting ARS first.
Date reported on your credit reports is a normal update item. The underlying data and status of your account is not changing per say, but their data base is throwing information to the credit bureaus monthly, and the bureaus catch that data (even though nothing may have changed), and loads that up with a new date.
Michael,
Update based on your advice! I know it has been some months since we spoke on here, but I did want to update you on the latest with ARS. I contacted them and settled for the amount of $468.79 from the original amount of $852.35. The experience was fairly straightforward, the young man who tended to me on the phone suggested that the full amount would look better so on so forth. I did request another letter to be sent to me with the amount of settlement. It did look like a refreshed version with logo but the verbiage was straightforward. It did say at the bottom “please do not response to this email” at the bottom of it so it leads me to believe it was some sort of template they sent with offer. I didn’t look to much into it and sent my payment recently for the agreed amount. They broke it into 6 payments of $78.13. I called before I sent the money order to confirm they did confirm money order and surprisingly the account had “changed representatives” and did confirm with the young lady that I had settled and that all looked okay. I did want to thank you for your advice back in September. While it almost 3 months later, I always believe in updating the forums. Because of people like you , the average people like us can be more confident that were not getting railroaded by these companies. Thank you again. Happy Holidays!
Awesome! I really do appreciate folks posting updates with how they resolved the situations that brought them to the site. It provides such encouragement for other folks still looking for answers, or trying to make decisions about the next step they will take to put a debt behind them.
All the best to you and yours too!
Michael,
I have received a Letter form Capital one today that my account is been charged off and and that I owe then 2,400 its till not showed as a charge off yet on my credit report i am sure it will soon. They are offerring to setlle the account for 1940.00. At this point do you think it will any difference if i pay in full or just take the setlement offer. If i take the offer will it show a balance or will it be 0. In your opinion what should you suggest to do. I am now in a position that i can pay the full amount. but if the charge off is going to affectme either way i think i should save some money and take the offer.
Thanks
If you can pay the amount you owe, and are concerned with Capital One continuing to report the remainder balance -after you settle – as still owed (even though, as the original article above points out, they agreed no more money is owed), I would pay the full amount.
If you need to save money on the settlement, as that extra money would put shoes on kids feet, and food in their bellies, save the money, get the deal completed and wait for the credit reports to be updated. If Capital One still reports a balance due when it is not, file complaints with the CFPB about the practice.
I had an account in February 0f 2004 with Capital One that was unfortunately charged off in June of 2010 and sold to Midland Funding LLC. I was able to work out a settlement and a pay for delete with Midland, but the Capital One entry is still on my credit reports showing a status of closed/ written off + $amt.
Is there any way to have this status updated or deleted? The debt has been paid in settlement and Midland has since deleted. However, the appearance of the status by Capital makes it appear as an unpaid debt. Capital One has been unforgiving of my past issue even though I have a new card with them now that has been opened since July 2011 and has never been late!
Your experience with Capital One continuing to show a balance owed on your credit reports after you settle with them is not isolated. It is, unfortunately, so common that I would not bother disputing this with the credit bureaus or with Capital One. File a credit reporting complaint with all of the dates and events and agreements etc., with the CFPB here: https://www.consumerfinance.gov/complaint/.
Please do post an update comment with how you progress.
Michael,
Earlier this year I wasn’t able to pay all my credit cards, my son passed away and I needed money for expenses. I stopped paying Capital One in Feb 14 since it has the highest balance (14K) and interest 15.9.
CapOne kept calling me and I have talked to them, waiting for them to offer me any kind of help, lower interest, hardship, something. I am so amazed that CapOne won’t work with me, even so I explained my circumstances, seems like they rather have you in collection than dealing with their customers. My account will be charged off if I don’t make a payment of $330 by this Friday. I realize they see my other cards and mortgage getting paid, eventually I will pay them all off. So, I am thinking of making this payment to keep it from charging off and hope they will work with me? Or let it go to collection and maybe they may offer me payment options or will they sue me right away? Thank you.
Can you afford roughly 300 dollars a month to Capital One while staying current with all other bills?
You will have options to settle with Capital One along the way, and would hopefully be able to do that before being sued (it is a higher risk with CapOne). But lets look at options to consolidate all of those credit cards and how affordable that looks for you, before looking at how long it will take for you to come up with 50% of your balance with Capital One.
What are the balances and interest rates on your other credit cards?
and yes the plantiff is Capital One on the judgment
Good morning,
I have a judgment with Capital One I am trying to get in touch with the lawyers that took the case, the problem is that 3 phone contact numbers are not valid numbers anymore. I would like to know who can I get in touch with @ capital one to try to settle the debt or any other help. I owe just about $1700.00 since 2007 and just want it off my credit report already. Thank you for your help.
Start with the general customer service phone number for Capital One. Tell them you wish to pay an older account that they sued you for, and have had no way to contact the attorney they hired. You will get connected to the recovery department, and will have to repeat yourself, and perhaps a third time when connected with someone who works on really old stuff like this.
Are you certain it was Capital One that sued and got the judgment, and not a debt buyer? Do you have a copy of the lawsuit, and does is list Capital One as the named plaintiff?
Yes, thank you for your detailed and prompt response by the way. Actually Michael I did found a number that transferred me to the new lawyer that took on the case, now they are saying that not only do I owe the $1700.00 but also a 4.75% interest…? Is this legal for them to do? They gave me some steps that “maybe” I can be eligible for to reduce the debt by 50% but that would put me at exactly what I owe them, which obviously doesn’t help me…should I have a lawyer on my behalf to see if I can get to pay the amount that I owe only? there is nothing in regards to a interest 4.75% fee to be paid in the judgment either…I appreciate your help
Judgment interest is capped by your state legislators, and it is very common to see double or more than what yours is at. But it is odd that there is no reference to the amount of judgment interest set by the court. You should run this by an experienced debt defense attorney. If you post the name of a nearby city I can send you an email with contact details to attorneys with the experience you want, that are nearer you.
The areas nearby I have are Sarasota, Port Charlotte, Punta Gorda and Fort Myers in Florida…thank you I appreciate your help
Thank you for your honest and fast response. Should we use anything from a 401K? We have a small one that may be used to settle the larger bill. Should I negotiate 40% of the total owed?
If this goes legal, will we first receive a demand letter from a legal firm?
I may be able to get a little money from family to help and I know I will eventually find a job.
Thanks!
401k money is typically protected from creditors in a bankruptcy, which means when filing say, a chapter 7, the 401k money can sit there and work for you undisturbed. And because of the penalty costs and taxes owed when you early withdrawal (for a non permissible purpose), you should have a really compelling reason to touch your 401k. There are solid arguments you can make for using that money to settle debt and avoid bankruptcy, but my experience over the years when I dig close, is that bankruptcy is better, unless you can borrow from your 401k, rather than withdrawal. And there are reasons to avoid that, or that you would even be prevented from doing so.
You should get a collection letter from an attorney, and if that attorney is in state, it is a warning shot across your bow that your risk of being sued have increased dramatically. But try to come up with plan now if possible. Settling when sued still happens… a lot. You just typically do not save as much.
Forgot to ask…if I look at the account online with the original creditors, will this instigate communication and a new date of delinquency? I read that if I communicate with the collections agencies, it refreshes everything…So confused.
sdk – There is good information online about dealing with collection issues. But there is really bad information too, and it often resonates well because… you cannot afford to pay the debts anyway.
Unfortunately, at least for now, that is you. There is not much to plan for if you cannot pull together the money to pay these settlements. If you could, or even if you were able to accumulate money monthly and save up to settle,I could offer some suggestions. But paying the mortgage and other bills late means there is nothing left. So calling collectors to get a plan together is not going to serve a purpose, and they are really not interested in hearing from you when there is nothing productive to discuss. But make no mistake, if your goal is to resolve unpaid debts after charge off, you will have to work with debt collectors the vast majority of the time.
It sounds like right now you may need to just stand pat. If the collections becomes a court issue, you can drill into your options,and an attorney will come in handy for sure. And if you are able to pull together some money, or get back to work and have some additional money coming in steady, plan your strategy from there.
No need to login to your online accounts that are closed, charged off, and now sold MCM, or assigned to First source for collection. But if you did, it would not restart any dates for delinquency. Just be sure not to make a promise to pay, unless your intention is to settle the account, and you have the money already.
Michael,
I have read through all of the above information and am requesting guidance on what to do.
My husband had two credit cards, one GM which was bought out by Capital One. The second is a Capital One card that for some reason CO changed the account number on. Go figure. Both cards are in collections due to family medical issues, a flipped house that we purchased with ongoing issues and now due to my loss of a job and no income. We are hanging on, paying the mortgage late, my car payment late and the household utilities and my smaller credit cards that my creditors worked with me on.
As for his two credit cards, we received a letter that the Capital One card was charged off in April. In May we starting getting collection letters from First Source offering settlements of 5467.44 on a 9112.39 balance or 2 other payment options which we can’t do.
As for the GM card, now owned by CO, we receive three letters from MCM offering a 40% then 30% settlement on a $6605.00 balance. We can’t do that either.
We have not called or responded as all info that I read prior to today said not to respond and deal only with the original creditor. I also read info that stated that since we did not have a contract with the collection companies, that we have no business with them. I have also read that they likely can not verify anything owed, i.e., the paper trail.
I do not want to get sued, but am in a mess. I have looked at selling my house, but I will be upside down simply by paying the agents commission. I am trying to find employment but thus far, nothing.
Can you please provide me some guidance on what to do with the credit cards? I do not want to file bankruptcy. Should I contact a lawyer that will cost me more money? I should also add that my husband has a DC, but long prior to all of the above, arrangements were made to pay off the account in monthly payments, auto debited each month.
Please feel free to email me privately for any further info that I opted not to include.
Thanks,
sdk23454
Hi Michael,
I have (2) CC’s that were charged off with Capitol One that they are reporting on monthly and have assigned Northland Group to collect upon. They both are currently 3 years into thier SOL’s and the amounts are $1687.40 and $1317.36. The latest offers via mail from Northland to settle them are 60% and 45% respectively. I’ve taken to working on cleaning up my CR as much as possible and although I know that paying these will not improve my score but I figure that my CR shows I at least paid something will be better than it showing the full balance as still being unpaid and charged-off. My plan is to call Northland and first offer to settle them around 35% of their totals but go no higher than 45% for both since they are already offering 45% on one of them. I also plan to request a settlement letter be sent to me before I make any payment. What do you advise I request that they put in the letter in terms of listing the debts as paid on my CR? I understand that Capital One are the only ones who can change the status on my CR so are they bound to change the status to whatever is listed on the settlement letter from Northland Group? I’ve read that Capital One will try and report the remaining balance as upaid on CR’s, what should I request in the letter to keep them from doing this and should I be concerned about them trying to send me a 1099 for the balance? Thanks for your time.
If you settle and save more than 600 dollars, it is not a question of whether you should be concerned about the 1099c from Capital One… you will get them. That said, you may not owe tax on forgiven debt resulting from settlements. See this article for more details: https://consumerrecoverynetwork.com/debt-forgiveness-taxes-settled-credit-card/
Capital One has been reporting a forgiven amount of settled credit card balances as still owed on credit reports for years, and I am of the opinion they are doing so incorrectly. Read more about this here: https://consumerrecoverynetwork.com/why-does-capital-one-hate-america/. You can see from some of the comments of this page what I suggest you do as a follow up to settlements you take them up on, where credit reporting of a balance remaining owed persists.
Your goal of getting 45% on both accounts would be mine if I were working the file. Getting lower deals approved on Capital One accounts (that are still owned by CapOne) is not common. I see one here or there, but 45% is the most common floor to date.
Thanks for the fast reply Michael, I appreciate your advice.
Forgot to ask, what are your thoughts on how the settlement letter should be constructed, should I stand firm on them stating that the balance would be zero once the settlement is paid and typically would Northland be responsible for creating the letter or Capital One. And lastly if Northland does construct the letter is Capital One legally bound to adhere to the terms of that letter? Thanks again
If you put the deal together with Northland Group, the settlement letter will likely come to you from them, and on their letterhead.
You should look for the elements I outline in this report: https://consumerrecoverynetwork.com/debt-settlement-letters-agreements/.
Capital One will be agreeing to the terms outlined by their agent, which is Northland Group. You will not have much problem getting everyone to agree that the balance owed upon acceptance and clearance of funds is zero. That does not mean Capital One will accurately show that on your credit report. You may actually need to decide if the settlement getting completed is the priority, if Northland Group is not able to adjust any written portion of their agreement with you. If you want another set of eyes on the letter let me know when you get it.
Will do, thanks again Michael.
Ok I am having problems. I had a cap one credit card. I lost my job in 08 and asked them to work a deal per month so I could it off. NO DEAL. I had to let the account go and my last payment was Jan 27 2012. I recieved a 1099c in Jan 2015. My credit reports show Collections /Charge off and they have a past due amount listed. I called and spoke to a number of people and supervisors plus the despute team. Any ideas. Thank you
What is goal you are trying to accomplish with Capital One?
Hello Michael, I have a cap1 in the amount of 1645.00 that has been on my credit report since 2010. I am currently in the process of correcting all the negative marks on my credit report to boost my score in hopes of purchasing a home. I have contacted cap1 in reference to this debt to try and pay off one way or another, and they refuse to take any sort of payment there also isn’t any collection agency involved.. They stated that the debt has been forgiven that I need to contact the IRS. Also, they are still reporting it as late every month to the CRA’s. However, the status states “closed-credit grantor”.. I have never spoken to, or received anything from cap1 since 2010 in regards to this cc, and never agreed to any forgiveness terms, or payment options in the past. So I am at a stand still with this account and no idea where to go with this… Hope you can help and lead me into some sort of direction.
This is an interesting catch 22 with Capital One. I have a couple of questions before offering feedback.
Is Capital One reporting on your credit reports that there is a balance owed as of today?
What state are you in?
Have you received a 1099c from Capital One?
Hi! I am so glad I found this article. I paid off an Capitol One acct back in 2010. it shows as a charge off. I called them to see if they can fix it and they refused. I spoke to a supervisor who also refused. They told me that they do not do pay for deletion letters. I told her that I have a letter stating that I paid the debt in full and owe $0. She says that I have to wait 7-10 years for it to be removed. The only thing they can do is report it as paid in full to the credit agencies. I told her my credit report shows that I owe $0 and she said that is enough. I have another card with them that is “inactive” but I only owe 229 on which I am paying in full. I asked if once the amount is paid, if the account is reinstated and they said no, it is a closed account and there is no way of reopening it. I have a credit card from another company, and Capitol One bought off that company so now that account is with Capitol One. (this account is in good standing.) I explained this to the rep and what a good history that account has and why can my other account be reinstated. They still refused. Not sure what to do here with the in active account and how to handle the charge off.
If you are looking for Capital One to delete the paid charge off, it is not going to happen. Not with them, or virtually anyone else. The fact it is showing as paid and zero balance owed is about as good as it will get… unfortunately. And it will be on your credit reports for 7 years, not 10.
Try not to get hung up on the fact that you have a charged off Capital Once credit card on your credit reports for 3 or so more years. If you maintain all other elements of your credit reports, this one paid collection account would not impair your credit all that much, this long since it occurred.
Does your other Capital One account, the one showing up inactive, have any late pays associated with it?
Hi Michael!
After reading all the comments here I am unsure what to do! I just received a letter from a collection agency with the name of Nelson, Watson & Associates, LLC for my capital one credit card. I have a balance of $600. I am trying to fix my credit score to get a mortgage loan. But reading all the comments here made me unsure what to do either way I believe it wont fix my score.
Thanks or your time.
Juliet
What is your credit score now?
For Nelson and Watson to be contacting you to collect for Capital One, your debt has not been paid for quite a while. That means the damage to your credit score is done.
You may not get a bump in credit score immediately after dealing with this collection account, but any loan officer or broker could require this be taken care of before you can be approved for the new mortgage anyway.
Credit score is 490 and age of credit history is 2 years. This was just affected due to divorce in process. I have two accounts with Capital One. I dont have anything on my credit report except student loan. I wanted to fix it before its too late. Would it be smart to just pay the amount now to avoid later trouble? I am just worried I would never rebuild my score because of this.
Given your goals, yes, it would be good to either pay this off, or negotiate a less than full balance payoff that accomplishes the same thing (just be sure to get any agreement in writing if you are settling with Nelson and Watson for less).
Michael,
Thanks so much for your help! I will fill out the contact information!
In regards to the original judgement that was originally defaulted against me: The court’s clerk didn’t see that I had responded in the system (overlooked they said) my response to the summones within the 30 days, and they automatically placed the judgement against me. I had to petition to have a hearing to dismiss the judgement, since I was the court’s fault. Now I am back to square one and Capital One’s lawyer resubmitted a request for a court date for Judgement.
Do you recommend I try to settle before the Judgement occurs? I am trying to obtain a personal loan to see if I can pay 1/2 of the debt in full, but I am nervous that they will try to come after me for the remaining balance.
thank you for your time!
Liz
If you have the resources, and settling with Capital One makes more sense for you than filing bankruptcy, yes I highly recommend negotiating and paying the deal before a judgment.
Hi Michael,
I was summoned by Capital One for the amount of $21,922.10. I responded within the 30 days and requested debt validation. The court overlooked my response and they gave me default Judgement. I went back to court to prove that I responded, and they dismissed the Judgement. The lawyer never responded within the 30 days of my request for debt validation, or proof that he is licensed in NM. Later he provided Capital One statements at the court hearing to dismiss the judgement, which was 7 months later. I had stated if he didn’t provide within 30 days that per the FDCPA, that the debt would be dismissed. Do I have a case to fight this?
The Law Firm for Capital One is Farrell & Seldin represented by James Grubel. When I talked to him on the phone, he went ahead and submitted a fraud request per my response that there was a $17k charge on the credit card statements that didn’t belong to me. They said that it was a credit balance transfer, but I do not agree since my previous credit card balance was only $7k, and I have proof on my credit report that that account was closed in good standing with less than the credit limit. I am trying to dispute this but I would also like to settle the remaining debt with them. James Grubel originally told me that Capital One would take 50% plus court costs if I pay in full within 3 months, otherwise I have to pay the whole balance. He said that Capital One wouldn’t consider less unless I submitted a letter to them, stating my reason as to why I can only pay less. He said it usually has to be a life or death situation for them to accept. I also read reviews that this Law Firm is very shady and either have sent payments back to clients, or did dishonest things with payments, so that they could go back and pursue judgement, resulting in garnishing wages.
A little more history, I stopped paying the credit card in October 2011 due to my mother-in-law being sick with cancer, as she couldn’t afford her treatments. My husband later lost his job 6 months later, and we continue to struggle with trying to pay off debt. We tried to file chapter 7 but since my husband recently got a new job, we no longer qualify. At this time I can only borrow about 45% of the debt to pay it in full. Do you think i should write a letter to negotiate? My two younger children are having surgery this summer, one of them to get his tonsils out due to Sleep Apnea and the other for ear tubes due to chronic ear infections, and with my high deductible Insurance plan, I will be responsible for 10% of their surgery bills, so money is very tight for us right now. I would be interested in your services to help negotiate, or have 1 to 1 counseling if available. I live in Albuquerque, New Mexico.
Thank you for your time!
Liz
Liz – I am not clear about what went down with the judgment, but from the way I understand what you shared, I would highly recommend you connect with an experienced debt collection defense attorney and go over the details.
When it comes to settling Capital One credit card debts, 50% is often the floor. There are better deals that get done, but not lower by much, and not at all common.
I do not currently offer coaching, or direct negotiation services. You can consult with a specialist in the network, who has been helping CRN members and site readers for many years.Just fill in the contact form on this page and submit. I will pass that on so you can schedule a consultation.
Hi Michael- I owe capital one about 7k in credit card debt. It’s all on one card. I have wonderful credit and have never missed a payment or made a late payment. However, I’d like to settle this balance in one lump sum. If I call cap one and offer to pay them 50% in cash to settle, what are my chances? After reading the comments, I’m scared of being sued, not having a “real” zero balance, etc…
Any advice would be much appreciated!
Thanks, Emily
Emily – You have to be several months behind in order to negotiate settlements in general, and in order to get the best savings from settling with Capital One.
Do you have other accounts with balances owed that show on your credit report other than Capital One?
Michael,
Thanks for the quick response! I do have other balances owed on my credit report:
-Credit Card with Chase (8K)
-Car Loan with BB&T (9K)
-Student Loans with Sallie Mae (40K)
I am current on everything and trying to pay each one off, slowly but surely. The concern is that I have no savings and typically live paycheck to paycheck (with a little wiggle room). I’m receiving a large commission check soon (about 8K) and want to use it wisely. If I can avoid paying the full 7K to capital one and settle for less, I will finally be able to put something into a savings account. Since my credit is good – I’m willing to take a small hit in order to settle my debts. Would you recommend being behind on payments and trying to negotiate in a few months? I make the minimum monthly payments on everything as of now.
Emily
Thanks for the additional details Emily.
I would not recommend settling at all. I would look at how to deploy those funds you are getting in a strategic debt roll up payment plan. Here is more about debt roll up (may give you some ideas): https://consumerrecoverynetwork.com/debt-roll-up-pay-down-credit-cards/
In direct answer to your question, yes, settling with Capital One will typically be an option in months 5 and 6 of missed payments. But your file is going to look like one they should not settle. You will look like a file worth suing to collect on. And that is because you have other debts that will be kept current, so you appear to have a steady income to pay everyone, including larger debts, but have selected CapOne to miss payments to. That is, at least generally speaking, how to show folks that collect debt for a living, that a nudge with a lawsuit would put them back on your priority to pay list.
You would likely fair better in this effort if the student loans and auto loan were the only ones being paid, while all unsecured creditors are not.
I’ve heard of the debt snowball method actually. It’s good to revisit that again!
I’ve decided to keep $1,000 “emergency” fund and put the rest toward debt.
Thanks, Emily
Hi Michael,
My debt is all corporate debt but I am personally liable for most of it. Small corp. in MA.
I owe Cap One about $40K, currently 3 months of no payments.
Do you see them treating business debt differently?
I have other unsecured debts totaling over $200K, ½ of this to a Wells Fargo account. I had been planning on bankruptcy, but the business is doing fairly well right now and I could raise perhaps $50K over the next 6 months.
Do you think I have a shot or is this just too much debt? Does the fact that it is corporate, not personal change things?
I have already hired a bankruptcy atty, but with the new work we’re getting am considering settlement
Thanks,
Steve
Steve – Capital One settles business debts too. The settlement targets are still 50%. The Wells Fargo accounts can settle at 35% currently, but there are extra concerns when settling with Wells Fargo accounts that large. I would encourage you consult with a CRN specialist, and probably Paul. Fill in the little form to the right and submit. I will forward that to him so he can coordinate a time to talk this over with you.
We currently owe approximately $31 000 on a Capital One credit card. We recently moved to Australia from the US and cannot afford to pay the balance (due to moving expenses, high cost of living here, now only 1 of us is employed, etc). We have not made this month’s payment and have called cap 1 to let them know that. They will not discuss our options at this stage as we are only just in default. We are curious to know what would happen if we default entirely on the balance, given that we have moved permanently to Australia. It seems unlikely that we would be sued by a US company while living outside of the USA. Thank you very much for any insight you may be able to provide.
Louise – It is highly unlikely CapOne would sue there. If you are certain you are not coming back, not much is going to happen with the debt if you do not pay it, other than your credit reports taking a hit, and the credit scores getting boxed around for a bit too.
There are instances of people being sued and ending up with judgments they never knew about, but that kind of thing happens whether you are in the US or leave it, and is happening less and less.
If you do get to a place where you want to resolve the debt, you have low interest repayment options with Capital One, and will also be in the drivers seat with collection companies hired by Capital One.
Do you see Capital One currently working with there clients with settlements or not.
Yes. I just reviewed a settlement last week for a touch under 40% with Capital One direct. Another comment today suggested their account would not go below 70% settlement (though it was not completely clear if they were dealing with an outside third party debt collector).
I’t’s been 7 months since I stopped paying Cap One. It was charged off last month. I’ve been trying to negotiate a settlement with them before charge off but they would have none of it. After charge off, they are asking for 70%. I would like to settle at close to 50% maybe 60% at most. They have offered with the 70% settlement a payment plan that involves 30% down and $50 monthly payments.
Today I received a FEDEX letter stating that if payment arrangements aren’t agreed to soon, I would get legal ramifications.
What can I do? They seem very unmovable. The agent assigned to me has called me the past two weeks to see if I like to take advantage of the offer, but I always refuse.
Please help. I don’t want a lawsuit.
Dan – I have worked accounts with people where 70%, even 80%, was as good as it got with Capital One. Heck, there are files I would not even suggest settlement for as an alternative to bankruptcy, due to how much of the debt consisted of Capital One accounts and amounts. There is something about your file that has them sticking where they are at, and because Capital One is more prone to sue in order to collect, you may want to consider taking the deal on the table now, but only if you can swing it financially. Otherwise, you may get something worked out more affordable payment wise later, just no savings from settling.
What was the precise verbiage used about legal ramifications?
Thanks Michael,
As an update. After reading all the post about how hard it is to work with Cap. One, I decided to take the offer from them to avoid legal action. I believe their next step would be a summon. I have about 20K worth of debt with them. Today I called them and spoke to them at length to try and get it settled. I think I spoke with two reps, and three managers. I spent at least an hour and a half with them and threw everything at them I could. I tried using facts, and finally a little begging. All to no avail. They stuck to there 70% offer.
Since I don’t have all the money to pay the 13,770 amount as a lump sum, they gave me the option to pay in 24 monthly installments. So i took it.
I don’t know what it is with them. They won’t budge. I’ve dealt with other creditors and gotten anywhere from 30-50% of balance.
I don’t have any assets other than a home with some equity. Michael, how much legal fees could they add to the balance of the debt if they won a judgement in court? That’s what force me to take what they offered.
I hope this helps anyone reading this. My experience with Cap One was difficult to say the least. I tried everything and they wouldn’t budge.
Also,
I have been with Cap One since 2003.
Michael, as an afterthought. I see that you negotiated a 40% settlement with Cap One. How much do you charge for your services?
I stopped offering direct services, or even one on one coaching, last June. If I work a file it is a severe hard luck scenario, something interesting and challenging, or just something to keep me sharp. And I do not charge for those.
Forgive me Michael, but I’m new to your site and after reviewing it some more, I think i should have used one of your specialist to negotiate my settlement with Cap. One
Ive looked into settlement companies that charge an arm and a leg and other independent debt negotiator that would charge at least 25% of savings. I never used any of them since I believe I could do better. Your 15% fee is the best I’ve seen and you guys appear genuine.
Do you think it would be a bad idea if I hired you guys to renegotiate with Cap One?
The call ended with them wanting me to call them to set up auto payment once I receive their written settlement agreement.
Just wondering.
Thanks again.
Dan – There are specialists with CRN you can work directly with, but they do not offer direct negotiation services in all states. The one on one coaching may have been worth the while too. Regardless, I am not sure anyone would have gotten a better outcome, including me. There are files with Capital One (Discover and AMEX sometimes too), that are just not gonna get a great deal. There are a host of reasons for something like this to happen. I won’t endeavor to outline those reasons here, but I think yours is one of these files.
We have had the lowest full service fees in the industry since 2004. The specialists you can still work with agreed to continue to support the same business model they always have with CRN, so that is still an affordable option.
capital one sued me and they already attempted to take 1991.85 out of my bank account which I had no where near that much so the bank declined it and charged me 75.00. I have stopped using my bank account so that they wont take all I have. I now have received my income tax and am using my boyfriends account. I would like to get it payed off so that I can go back to using my own bank account but I don’t know who I need to get ahold of to get it settled.
Marsha – You generally want to get in touch with the attorney that Capital One used to sue you in order to negotiate the settlement. If you learn they are no longer able to work the file, you could contact Capital One directly.
Hi I am having issues with capitol one. I had a card that i couldn’t keep paying becuase I had health problems. Well now, the card has been charged off with a bunch of extra fees that total $2400 and some change. The original amount was $2000. I tried to ask for a settlement. The agent was demanding high monthly payments or the total balance. She kept talking about a lawsuit with Capitol one. What can they do to me? Will they take money out of my bank account? or garnish my wages? What exactly can they do? I would like to work it out with them, but because I cancelled the high monthly payments 2 times, the agent took the settlement off the table. I became upset and hung up. What is my next step. I felt so intimidated with that agent.
lita – Have you already been sued for the Capital One account? If not, how long had it been that you missed payments, before agreeing to, then stopping the monthly payments? And were those high monthly payments ever made, or did you cancel them before a single one of them went through?
Hey Michael,
I have recently been dealing with Capital One about my old credit card that charged off back in 2008. My balance was between 1100-1200. I originally contacted them about settling my account after my wife and I spoke with a realtor and lender trying to get pre-approved for our first home. We are trying to raise my score a few points by settling this old debt. I was offered a settlement of $575. I sent them a money gram the next day with that amount and was told a letter would be at my house within 7-10 business days. After two weeks, I did not get the letter. I contacted them again and was able to get them to fax me the letter. I gave that to my lender who forwarded it off to the company she works with to help raise my score. I was told to wait 7-10 days for that and then we should have our pre-approval. Eight business days later I am contacted by the lender telling me that they were having trouble with Capital One reporting settled but with a balance of about $570 instead of a zero balance and they didn’t understand why. We were all under the impression that when you make a settlement and honor it, the rest of the past due balance would be forgiven and it would be reported as settled with a zero balance. When I contacted Capital One again I was told that yes it was settled and they would not be attempting to collect a debt anymore but because I did not pay in full, it will not be recorded on my credit report as a zero balance. I was told this today and was unable to get back in touch with my lender again to see how we should proceed from here. I am worried that because Capital One is not putting zero balance, we will not be able to do what we are attempting to do and get our pre-approval. This is becoming very frustrating because we are expecting a newborn in a couple months and are trying to be in our own house before then. Is there anything that we can do to get this taken care of? I dont know if Capital One is doing something they shouldnt be regarding the settlement and if so how I should proceed to take care of this problem. Like I said, I was under the impression that a settlement takes care of the debt completely including forgiving the additional past due balance and reporting a zero balance. Am I wrong? I know that’s how it works with pretty much every other creditor and my lender said that she has never had a problem like this before. What should we do?
Thanks in advance,
Kade
Kade – Capital One is the only credit card issuer that I am aware of that thinks they should be reporting a balance still owed, even after they agreed to a settlement, and a balance is no longer owed. I wrote about that here. Did your settlement agreement from Capital One have some of the same language in the letter I link to in that article?
I would encourage you to file a complaint with the CFPB here: https://www.consumerfinance.gov/complaint/. Filing the complaint against Capital One under the credit reporting heading makes the most sense to me, but you should probably file against Capital One, not the credit reporting agencies in my opinion. Capital One has staff assigned to the CFPB complaint portal that are better skilled at dealing with your issue than the people you will reach on the phone through general information lines. You should get a direct response within 1 to 2 weeks (based on feedback I am getting).
Please do keep me posted with how you progress with this.
Michael,
This account charged off in ’08. I know it had been sold off a couple times between then and now. If I had received a collection letter from Capital One I assume it would have been back then but I do not have one or recall one. The collection agencies would send their letters, those of which I never kept either. I contacted Cap One myself trying to settle. Everything was done over the phone.
As far as filing this complaint, would that put a dispute on my credit report? I am being advised not to do the complaint if it will put a dispute on my report because I can not have one when trying to buy a home. If it will not put a dispute on there I was told to go ahead and do it if we think it will help.
Thanks,
Kade
Kade – Did the letter you got faxed to you, that you reference in your above comment, speak to credit reporting at all?
I am not aware of any complaint filed with the CFPB, that later resulted in being interpreted by the credit reporting bureaus as a formal consumer dispute, of a type typically sent directly to the agencies as part of your rights under the Fair Credit Reporting Act. It is even more unlikely that would occur when your complaint is being directed to CapOne, not one of the credit bureaus. You may want to be clear in your complaint that you are not wishing to note your reports with the credit bureaus as under dispute.
I was sued in 2008 by capital one for a balance of $4000. I do not deny the debt but I have not been the smartest about it. I am now older and wiser and trying to clean up my credit. Is there any way to settle with Love, Beal and Nixon in Oklahoma and get that taken off of my credit report? And I do not know whether it matters or not, but I no longer live in Oklahoma. I do not want to pay it off and it still show up on my credit report. What steps would you recommend to getting this taken care of? Should I contact them via mail with an offer? Thanks!
Natalie – Settling the debt with Capital One will not result in it being removed from your credit report. It is a judgment, so the part of the court record which is public. Negotiating a lower payoff with Love, Beal, and Nixon will result in the CapOne judgment showing as satisfied in the record, which would help you better qualify for certain credit.
I am a big fan of starting your negotiations over the phone, not sending offers in the mail. Offers and documentation, in my experience, are better left to the collection side to send.
Do you know the balance owed today?
What amount are you prepared to pay in a settlement?
Recently found out that I owe $750 to a closed Cap1 credit card, that I neglected years back. It of course is in the collection state.
This is the only debt I have & want to get it taken care of ASAP.
I have moved around so much, & forgot to check it, the balance jumped & closed the account without any thought from my end.
I called them today after normal hours and the rep asked that I call her back tomorrow or Monday.
Any advice?
Matt – Settling a Capital One account in collections is fairly simple. How long ago was it that this credit card last received a payment? Do you know who the account is out to collections with? Is anyone other than CapOne reporting this on your credit?
Mr Bovee, I have already been charged off by Capital one and First Source( their collection group) contacted me and I made payment arrangement with them in 2011. I was supposed to pay $50.00 a month for 47 months. After paying for 13 months it only reflected i made 3 payments. I contacted them and told them I would send more because I felt they were cheating me. Love, beal and nixon bought the debt and sent court papers for me to answer to the court about the debt. I sent the money order and all the letters to the court. I never heard a word until August of this year and the court sent a letter in regards to it setting dormant for over a year. I went to court and the day of I received a letter from Love , beal and nixon dismissing without prejudice. Sir I am now being sued again by Capital one. I really tried hard to be honest and pay them, but they made it impossible with the late fees and interest. Is there any way to get them to settle with us now? Thank you Charles Foster
Charles – You can settle when sued, or at any stage of collection. It sounds like the case was dismissed already. Were you sued again? If you can clarify what the disposition of the account is today in a follow up comment, I can offer some feedback about settling the Capital One debt now.
Hey, everybody! I got some great news that can hopefully help some of you struggling with Cap One. I just got a hardship program with them for zero APR.
Office of Executive Resolutions @ Capital One
1-800-955-1455 Monday through Friday from 8:30 a.m. to 5:00
p.m.
Good luck to everybody! Hope it works out as well for you as it did for me.
Hello Michael
I have a Capital One credit card balance 16,000 , lost job 21 months ago , wife stay at home mom ( we are both looking for employment ) and unemployment ran out
I have been told that the account charged off 8/13 I would like to settle with money from 401k
but they want upfront money payments for 10 years and a mark on my credit till paid of 10 years
I told them I would pay 70% almost 50% of that upfront and payments but the account needs to read currant after they received the upfront 50%
they said they can not do that.
should I just pay and deal with it and try to pay off faster
or should I hold out for lower settlement or credit report change to currant
John – You have no shot at Capital One agreeing to accept payment and bringing the account current. In fact, now that the account is charged off, it is going to stay there for 7 years from the date of charge off (not 10 years).
You can often settle with Capital One for 50% of the balance, either directly or through a debt collection agency they place the account with. Given what you shared about how prepared you are with funds to settle, I would be aiming to get Capital One to agree to the lowest offer they accept based on today’s trends (I see very few under 50%). I would not continue any discussions with them about the willingness to make any monthly payments. That is not conducive to your negotiations, and not consistent with your credit report concerns. In other words, getting this debt fully behind you will be better – all things considered.
Are you currently speaking directly with Capital One recovery in your efforts, or is there a third party debt collector involved? If a third party, who?
Hi,
I am being sued by capital one. I just recently found out they served my ex-husband. He just mentioned it to my son, so I don’t know if it was a day, week or month ago. I am not able to answer the summons because I don’t have it. Should I call the attorneys listed on the lawsuit? I was able to look it up, but could see no details. I do owe the debt, and would like to make payments, but I fear they will just get a judgement and empty my account and/or garnish my wages.
Erika – Is the court Capital One sued you in close by? You can go to the court and get a print out of the lawsuit, and also look at the date the process server says they served the complaint. Post an update with what you learn.
You can call the attorney Capital One hired to set up payments. But it would be good to know if they already have a default judgment before you do that, as my feedback would be little different.
Also, what is the amount of the suit? What can you afford to pay monthly?
Michael,
Well, I received a summons today. I have 20 days to answer. The amount is $2142.00. I’ve heard that Cap 1 is merciless. I could make payments. I am currently paying one other @ $150 per month. They accepted payments but still got the judgement. I would like to make payments, but how to I avoid Cap 1 from still getting the judgement?
Erika – Once sued, you can often set up payments, but that will often only occur if you sign a stipulation of consent to judgment. In order to avoid any of that you would want to come up with a lump sum settlement. What are the chances you can come up with say 70% of the balance?
Michael,
I’m not sure about 70%. 50 – 60% could be do-able. It will cause me to fall behind on my utilities and rent, but I think I could work out partial payments on both of those. Do you think I should call and offer $1000? That is just under 50%. I’m looking at it as a starting point. I will hope for 60% which would be $1285.
Erika – I have worked on many files like yours over the years. I would not forgo paying your rent and utilities over this in order to settle with Capital One. I would opt for discussing a monthly payment with the law firm collecting. You can call them and ask what a payment plan could look like. Let them know you are already paying on a judgment. Do not go into particulars of it, just that you have a judgment, and are paying it, and cannot afford much monthly. You can ask at the same time what a settlement might look like in case you can borrow from a family member (even if you have no intention of borrowing), and see what that might look like.
Post an update with what you learn and lets go from there.
I thought I would post an update on my dealings with Cap 1. After receiving a summons I contacted Capital 1 to try to make some kind of payment arrangements. Well, they would not even discuss it unless I provide my SS number, place of employment, and annual salary. I refused because I felt they were just going to get a judgement and go directly to garnishment. I felt I did not need to provide this info, even though my place of employment and annual salary would be very easy for them to find. I proceeded to hire a lawyer. He is charging a flat fee of $2500. There has been a slew of paperwork back and forth but as of yet, no court date or determination. He says he has dealt with Cap 1 several times and they fight, but he has never lost against them, so I’m hoping I won’t be his first.
Erika – I applaud your tenacity! Not everyone is going to invest in the legal help you have in order to stand up tall on principle when that same amount would pay the bill. Please post updates with how this progresses for you.
What is your thought process on CAP 1 now, how r they working with negotiations?
Charles – Negotiating with Capital One to reach a settlement prior to charge off goes to the wire. When settling direct with Capital One it typically occurs in the last week or two before charge off. Most settlements with them are occurring after they send the account out to a third party collection agency. Realistic targets are still 50% of the balance at the time of settlement. If the account goes to an attorney collector – a little higher.
I have a cap1 card that I have had for at least 10 years now. I am having a very difficult time paying the high interest and getting nowhere fast. When our Obama announced that he was going to cap credit card interest, they upped it to 14.9 %. I will never get this paid. I am on disability and just now getting student loans paid off. Any ideas how to deal with them. I am LOST.
What is the balance? Do you have other credit cards besides the Capital One account? If so, what are those balances and interest rates? How much do you owe on the student loans? What are your payments and interest on those?
Hi, Michael! This is my first time asking for help with Cap 1. I have three cards with them now. Two are cards from other banks that were recently sold to Cap 1; I had those accounts for years. I’m hoping to get hardship programs with the two transferred accounts only. The Cap 1 account I’m not asking help with is only a year old. Hope that might be useful info! Jenny
..Cap 1 won’t work with me. Sorry for the typo!
Jenny – Have you been on any other payment plan arrangements with Capital One in the past? If so, when was that? How long have you had your Capital One credit card?
Any updated tips for Capitol One? All my other cards are giving me hardship programs, but Capitol One work with me. Thx!
I have a similar issues with Capital One. I was told that my account was settled and would not interfer furthure with my credit after I made a lump payment of $900. This however is not the case and they are still reporting that I owe them over $1100. I don’t know what to do. This is now keeping me from getting a mortgage.
Rebecca – Do you have a letter showing that the account has been settled? Do you have the ability to prove you made the payment by the date that was set up for the settlement amount (bank account statement, other)?
Post your answers in a comment reply and lets go from there.
The original charge off entry on your credit report put there by capital one is not going anywhere using a pay for delete strategy – even if you pay it off in full rather than settle the account.
If the account is with a debt collector, but still owned by capital one, you will likely have to deal with the debt through the debt collector. Is there a collection trade line separate from Capital One (but about the Capital One credit card account) appearing on your credit report?
What is the name of the collection agency currently trying to collect on the CapOne debt?
I am not sure what and where you are reading about pay for deletes. The fact is, pay for delete is not what it is made out to be by many of the sites that talk about it. It is not done with original creditors like Capital One. It cannot be done through an assignee of the creditor (a collection agency collecting on behalf of your original lender), as they have no ability to remove something they did not put there.
About the only legitimate shot you have at a pay for delete is with a debt buyer who makes their own negative credit reporting entry that is totally separate of the banks charge off reporting. A debt buyer removing a negative entry, or not responding to a dispute investigation you file with a credit reporting agency (which would cause the item to be removed), has no affect on the charge off that Capital One made. Pay for deletes with debt buyers are just not common.
Pay for deletes are not an urban legend, but they are getting to that point.
I’ve had a cell and a few different cars all stayed in good standing, cable and nymo. I was just thinking that the charge off being there were automatic decline. Obviously i have to pay them, but i didn’t know if i should deal with capital one or the agency or i dont have a choice. i dont know if there is a def. way to get the pay for delete thing i keep reading about
It sounds like you are trying to get new credit and are being turned down based on items on your credit report.
Capital One is reporting a charge off for an unpaid accounts from 2007. That’s 5 years old and would generally be considered pretty stale.
If there are no other negative items on the credit report, what types of recent positive items are on your credit? Mortgage, car, other unsecured accounts?
What is your goal with Capital One account? Are you contemplating contacting CapOne to settle the debt?
After this long, you will likely (not always) find you will be forwarded to a debt collector working for capital one.
I am in shock I was not aware of the CFPB, have been in credit report for 2 years with Lexington Law, Cap 1 has 4 negative items on my CR 6 ACCTS all together 2 i accepted that they were mine. The 4 they have on there are for over 6, 000 dollars. They have been sent 4 rounds of validating these accts as mine. There is no acct # no Credit limit no dates no payment history. In response to getting them to prove there mine CAp 1 has sent me several letters requesting my personal information. These negative accts have cost me such a loss my score plunged with these negative items I have a card with them from Orchard bank that was a $300 limit after about a year of requesting CL INCREASE ONE DAY GOT A EMAIL THEY GAVE ME A cli of 3200 dollars. They will not approve me dor any card, I closed 1 account i had with them and an unable to see my statements. So I keep my card with them I do not carry a balance. I received 1 letter from then addressed to me but the the letter was to some Chinese Restaurant. Lexinton law said I would probably have to go to FTC or my state ATTORNEY stringing I MOST PEOPLE GIVE UP AND PAY. I have records back to 2011 and no late payments They reined my credit Lexington law took advantage of me by stringing me along, continuing I do not believe in disputing CC AND BANKS do what they want they refuse to give me or anyone else any info on these accts. Will fight for the fact these are not my accts. THANKS Jene Pitsenbarger
You may want to check out this post about filing your complaints with the CFPB.
Post an update with what develops.
I have a $400 charge off with cap one haven’t contacted them at all yet. I’m trying to figure out the best starting point.(From 2007)I’ve tried a few other credit lines and it looks like the charge off is the issue that is getting me declined.
Wondering if anyone has had any success getting Cap1 to remove the erroneous info after settlement.
If by erroneous you mean getting them to remove any reporting that shows a remaining balance owed after a settlement was agreed to and terms met, yes. There is a fairly painless dispute process to follow. If it is not fixed on first response, you would typically send a second reinvestigation request. If it is not corrected following that, you have additional options to explore.
This is something of a passion for me. If you would like to connect off line, my time is available to you at no cost.
I will send you an email. Reply to that if you would like to coordinate a time to speak.
Hi my husband paid an outstanding loan off to debit task last year. He then got a letter saying the account was closed and completed. After wards we found out after applying for a mortgage that an outstanding amount was owed and the loan did not show c for closed and completed. Is this grounds to get this removed? He still has the letter saying the account is settled and closed it never mentioned outstanding amounts
Lee
Your email suggests you are in the UK. Are you dealing with debt or a mortgage in the UK or in the US?
Hi Jen,
Reporting a balance due when it is agreed through settlement that no remaining balance is in fact legally due is likely a violation of the FCRA.
To take CapOne to task on this you will have to first follow through with the settlement, then verify that they are reporting incorrect information to the bureaus followed by disputing the information with both CapOne and the reporting agencies.
If the incorrect information remains, you have the option of pursuing them in federal court for the violation. You can continue to be damaged by their reporting a phantom balance as due with paying higher costs for credit products in the future. Your actual debt to income will be skewed by the continued misrepresentation of a known inaccuracy.
If I were personally in your very shoes given the limited detail you shared in your comment (thanks for leaving one by the way), I would follow through with the settlement and take care of the reporting afterward.
Waiting for the debt to be placed after charge off is a plan, but may not be the best one.
What is the settlement you have currently? Can a similar deal be struck with a collection agency or worse, an attorney the account is placed with?
I cannot say until the account lands in the next lap.
CapOne plays so many monkey games that are totally unnecessary. Your comment reflects that. I am not sure who is in charge of developing and infusing company culture over there, but in my opinion they need to be replaced.
Capone will pay assignment costs and fees on any settlement you later agree to, so money now is better than what they get later.
Please come back to the comments and let me know what you decide to do and how the situation develops. If I can assist you in any way, I will.
Best of Success!
I am currently dealing with Capital One and my ‘settlement offer’ contained the verbage of both 8 and 9 above. I had my cashiers check in hand today, and I actually went to the post office and overnighted it, when I came home I decided to google the verbage “settled with an outstanding balance.” to see what came up as this verbage bothered me from the beginning of my dealings with the Cap One rep. He would not put the verbage as settled in full as did my Discover Card. I, luckily was able to retrieve my overnight package, and therefore I will likely go to charge off but I dont think charge off will be any worse than paying the settlement only to have them sue me and add late fees to the balance that i thought was settled.
As a side note, Wayne, my CapOne rep gave me a very hard time about faxing me a copy of the agreement for the longest time. And then once he finally agreed last week, he, in trying to force me to pay via check over the phone, tried to tell me that oh the faxing department may not get to it til Tuesday or Weds and if you don’t pay by Weds, the agreement is null. So many times he told me I just don’t understand why you don’t trust us, you’ve paid us via your Checking account for 10 years, you know, the one we have on file… XXX I was adimate that I would be overnighting a cashiers check. At first he told me this was not an option. I told him I closed that account… which I did on Monday so that they couldn’t help themselves!
So this is where I am now, I did not mail the settlement check because I do not feel that verbage in the agreement is in my best interest.
You raise a number of good points that will be fascinating to get answers to. I can’t wait to see what you uncover here.
Steve
The Star Tribune Published a list of the top 15 companies garnishing Minnesota residents over a 5 year period today.
No surprise that Capital One is at the top of the list, even beating the second place companies in both categories by nearly double.
https://www.startribune.com/investigators/101723943.html?elr=KArks:DCiU6:5DiaPQEacyiUiacyKUUs
There is a really good article from the Tribune today that tells the story of those who are garnished, even when their money in bank accounts are exempt from levy, or who did not even legally owe the debt.
https://www.startribune.com/investigators/101723868.html?page=1&c=y