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LearningTheHardWay

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How do I go about paying back my 2 creditors for less than the mount owed??
I have 2 collections on my credit report that have to be paid back before my credit union will give me an auto loan. They are in total $746. I know who the original creditors are and need to get this taken care of so I can get my auto loan. I have read that this has been done but can't remember where I have seen it on here. I don't have the whole $746 but to be able to at least pay some of it back I'd feel better about. Any help would be appreciated.

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Negotiation. You will contact the lender or debt collector and ask if they will take less than the full amount owed to consider the account settled. This is known as a "settlement amount". Offer lower than you are willing to pay to allow them room to counter offer. If the debt is within the statute of limitations to be sued for the debt, then they may not be willing to negotiate as much as if it were outside of the SOL when they are unable to use the courts to collect. However on a debt so small, they probably would not go to court to try to recover it as it would cost them more than the debt is worth. Keep in mind that when you do pay the debt or settle, the account will update due to doing this and will cause a decrease in your scores if the account has not updated for a while and that may cause problems with getting approved for the new loan if the credit union has score requirements as well.

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Thanks for your help!  When negotiating with the creditor, can I do it as pay for delete type of agreement? And how do I find out the SOL time frame?  Both of these accounts are under dispute right now with both Equifax and TransUnion because there isn't any up to date information, no last date of payment etc.  I already checked with my credit union for the loan and was told these needed to be taken care of before my loan could go any further.

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When giving a settlement offer you should still try for a "pay for delete" but they will be less likely to agree to a pfd unless you are going to pay them the entire amount, but DEFINITELY try for a pfd when you give a settlement offer. For most negative accounts the SOL is 7 years from the date of the negative action. For credit cards, the SOL starts at the DOFD (date of first delinquency) this is the date that you've missed the first payment that led to the charge off. (and the account would not have been brought current any time beyond this missed payment). For utilitiy, medical bills, etc, I believe the 7 years starts from the date of service. Another rule of them is to figure the start of the SOL is usually 1 month after the last payment that you've made on the account. All of this information should be included on your credit reports. If it is not, you could contact the original creditor to see what dates they have on your account. However, if all of this information is missing then you did right in my opinion to dispute it and make them provide the information and if they don't hopefully they will remove it. If you have both of these accounts disputed right now, then I would wait to see the outcome of that before you contact these companies about paying the debts. Just some advice, Slow down with all of this and do some more reading on everything so you don't make any mistakes. Hasty actions are usually bad actions.

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I can't thank you enough for your help.  I definitely am going to wait to see what the outcome is on the disputes.  It can be confusing with the lack of information, and who has opened what account over and over again, why information isn't included etc.  I thinks it's all done to just screw over the consumer.  There should be laws in place so that when accounts do fall into collections that information has to be kept up to date at all times.  The amount on my account is small enough that it would cost them more to hire an attorney than to just agree with the offer.  Though my credit union told me that I just needed to show proof that the accounts were paid and the loan could proceed.  I'm not in a real hurry but would like to get things done and in a new car before winter sets in.  Hopefully things work out.....fingers crossed!!  Thanks again for the help and the advice.  :)

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