AMEX/VISA debt quesiton for all....

[I_Suck]

Skipper,

Any amount that is not paid back in a settlement situation, you will most likely receive a 1099 on that amount from the company you settled with. So if you have a $20K CC balance and settle for $5K, you are now responsible for taxes on the $15K.

[Skipper]

Skipper,

Any amount that is not paid back in a settlement situation, you will most likely receive a 1099 on that amount from the company you settled with. So if you have a $20K CC balance and settle for $5K, you are now responsible for taxes on the $15K.

Thanks...

Since I am "insolvent", I do not believe that I would be in a taxable situation (hopefully)... Back to the other question; In my situation, I currently have $65k in total cc debt ($35k amex/30k citi). Assuming they both agree to settle for 50%, do you know if the remaining amount (the 50% that is not paid due to the settlement) can be sold and collections attempted? If so, what is the point of settling anything?

I appreciate your thoughts!

Skipper

[jacko]

Skipper,

Save your dough and file Chapter 7 if you can. Life is to short. There is no point in settling. A BK brings closure and allows you to have a fresh start.

Thanks...

Since I am "insolvent", I do not believe that I would be in a taxable situation (hopefully)... Back to the other question; In my situation, I currently have $65k in total cc debt ($35k amex/30k citi). Assuming they both agree to settle for 50%, do you know if the remaining amount (the 50% that is not paid due to the settlement) can be sold and collections attempted? If so, what is the point of settling anything?

I appreciate your thoughts!

Skipper

[backtoschool]

Thanks...

Since I am "insolvent", I do not believe that I would be in a taxable situation (hopefully)... Back to the other question; In my situation, I currently have $65k in total cc debt ($35k amex/30k citi). Assuming they both agree to settle for 50%, do you know if the remaining amount (the 50% that is not paid due to the settlement) can be sold and collections attempted? If so, what is the point of settling anything?

I appreciate your thoughts!

Skipper

You would have to get an agreement in writing from the original creditor (ie amex and citi) that your settlement, settles the FULL balance in full and that no further balances or collection activity can be taken by them or any other party. They settle cards all the time so they sign agreements like this. It is not a foregone conclusion that they will sell the balance of your debt. (Many cc companies do not). It is a foregone conclusion that you will get a 1099 for the balances forgiven.

It will not be that difficult to get the original creditor to agree to your settlement equalling payment in full. AMEX and CITI continue to own their debt (as opposed to selling it off to a jdb) much longer than many other cards.

But that being said, I agree with all the other posters, that you sound like a good fit for chapter 7.