Is this a good settlement offer ? Chase

[Coldplay]

Our Chase CC is close to 21,000. Someone called today and offered to take $5,200.00 We stopped paying in October 2009. Should we accept or make a counter offer ? We'd have to borrow the funds from family to get it paid off since we don't have that kind of money.

Also, we have not filed our Chapter 7 yet. If we settle with this CA would it affect our other debts and the ability to file ?

TIA ~
Coldplay

[StartingOver08]

If you are going to file Ch 7...don't pay off this debt with funds borrowed from a family member.

It does not matter if you BK on $10k or $1M with the creditors....a BK is treated equally by the creditors.

Are you thinking of settling this debt because then you would not have to file BK?

[Mi Bankruptcy]

Then if you filed BK you would have to explain where the extra 5k came from to pay off chase on the settlement. Then you may have to include that loan in the agreement. If you filing CH7 don't pay anyone anything unless you plan on keeping the stuff( house, car, boat)

[jacko]

Why bother. If your credit report indicates a BK candidate, don't bother. They may not sue you and can wait out the Statue of limitations. If you settle, it will be duly noted on credit report and your other creditors will see it and most likely file suit. Plus a settlement will open a huge tax liability. Your credit is trashed and will remain trashed even if you settled.

Our Chase CC is close to 21,000. Someone called today and offered to take $5,200.00 We stopped paying in October 2009. Should we accept or make a counter offer ? We'd have to borrow the funds from family to get it paid off since we don't have that kind of money.

Also, we have not filed our Chapter 7 yet. If we settle with this CA would it affect our other debts and the ability to file ?

TIA ~
Coldplay

[frogger]

If you are going to file Ch 7...don't pay off this debt with funds borrowed from a family member.

It does not matter if you BK on $10k or $1M with the creditors....a BK is treated equally by the creditors.

Are you thinking of settling this debt because then you would not have to file BK?

Spot on advice.

[catleg]

[epiphany]

Then if you filed BK you would have to explain where the extra 5k came from to pay off chase on the settlement. Then you may have to include that loan in the agreement. If you filing CH7 don't pay anyone anything unless you plan on keeping the stuff( house, car, boat)

Yep or if you somehow managed to pay back your family member before your bk, it could be considered a preferential payment and the trustee could go after that money.

Someone else brought up the tax issue which is a good point too. You would owe taxes on the amount forgiven. I would follow everyone's elses advice and just include Chase in the BK.

ep

[ryan]

I'm presently being sued by Chase. To me dealing with them is a 'Heads You Lose, Tails You Lose' kind of deal. As has been said, if you settle with them, the other creditors will see it and probably come after you hard. They will smell blood in the water.
Plus, you may owe IRS on top of it all.

If you don;t settle, they may sue, but it takes time and by then you'll be, presumably, able to file BK. It is these early and unpredictable lawsuits that have convinced me settlement is the wrong move.

[DebtHater]

I agree, if you are going to file BK anyway, don't settle.

If you do settle, get the agreement from Chase in writing before sending any money. If you don't get it in writing, the deal didn't happen (as far as Chase is concerned).

Once you get it in writing, only send money via cashiers check. No electronic access to your accounts. They will conveniently take more than agreed upon.

Once the check is send, keep the receipt with the agreement letter from Chase for life! This way it will protect you from CA's down the road.

Lastly keep in mind if you settle, you will likely owe taxes on the amount Chase writes off. In other words if you pay $5200 now to Chase, you will pay taxes on $15,800 to the IRS later.

[Coldplay]

Wow. Thanks everyone for your detailed answers. It's been very helpful.