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What Can I Expect From Chase Visa as We Near Charge Off? – Sarah

“Dear Steve,

Our $25,000 debt with Chase Visa is close to ‘charge off’ (approx. 30 days) as we are 6 months behind. So far, Chase have refused to settle – we had offered a $10,000 ‘one time’ (not installments) settlement payment to come from a family member.

But most recently (they called about 2 weeks ago) we offered $8,000 as we have used $2,000 from the family member to pay off other small debt. Chase went through a 30 minute ‘song and dance’ with us on the phone leading us to believe they would accept or at least counter-offer our settlement offer of $8,000 – but in the end thay said ‘no’.

We are holding out to the bitter end with them. We have to believe they will take the $8,000 (or the original $10,000 as my family member will make it up to $10,000 if needed, but not a penny more) rather than turn our account over to collections?

What can we expect to happen over the next 20 to 30 days? Is there any more pro-active action we should take (we have had fairly regular – approx. once per month – contact with them for past 6 months). ? Many thanks!

Sarah”

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Dear Sarah,

Remember, all of this is a negotiation and Chase is not obligated to accept anything if the don’t want to. Corporate policy and logic often seem to be mutually exclusive.

The options if you wait are the same you face now, such as lawsuit, etc. But what is most likely to happen at this point if Chase does not come back with an offer you can accept is that Chase will sell your account to a third-party debt buyer who will begin collections efforts again and you can attempt to pickup negotiations with them.

Chase selling off the bad debt is not the end of this so keep the money on hand to settle. Don’t forget, the only real power you have to drive the bus here is to avail yourself of your legal rights under bankruptcy. Other than that, the creditor has the advantage for the most part.

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Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

1 Comment

  • Your target amount for settling the account is consistent with Chase policy for settling prior to charge off. Your strategy of taking it to the wire is probably necessary.

    Your target amount and timeline could be affected by how your account is flagged.
    Did you make recent balance transfers to the card?
    Make large dollar purchases using the card prior to stopping payment?
    Take out cash advances?
    Are you current with payments to other unsecured creditors?

    Those things can and do affect your ability to settle for the best savings, or even at all, direct with Chase and prior to charge off. They can also affect what you are able to settle for with a debt collector Chase may place the account with.

    Chase does not sell all defaulted and charged off credit cards. If yours is sold, a debt buyer would care little about 3 of the above 4 items. Your target settlement is attainable with a debt buyer and perhaps a bit higher with an attorney debt collector.

    You can only do what you can do, so stick with it.

    Here is some light reading on the above topic: http://consumerrecoverynetwork.com/forum/content/section/158-accounts-inlude-debt-settlement.html

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