Hi, I have a question about dealing with creditors in general, and Capital One credit cards in specific. I have had some bad financial times over the past six months, and I haven't been able to pay on five credit cards. Four of those are with Capital One. This next month will mark the 180 day period so most will be going into chargeoff territory within the next week. I'm embarrassed to admit it, but the total indebtedness on all five cards is less than four grand even with interest and late fees (compared to other people's postings, this seems so trivial), but I just wasn't able to make payments for pretty much this entire year.

I just got a $3000 loan from my family to take care of those cards, and I was wondering how it would be best to approach the situation. Those cards have credit limits between $300 - $600, and I'd be able to pay them all in full if the creditor(s) are willing to just drop the amount owed to the credit limit. I hadn't used any of those cards since early 2005, and two haven't been used since 2003. I feel like I can negotiate a satisfactory settlement with them since I'm not trying to screw them... I went back and did some figuring and I've paid at least 200-300% of any amount I ever charged on those cards already.

I'd just like some specific advice about how to proceed. I figure if I call them up, tell them I'm trying to forestall the chargeoffs, that I'm able to pay some percentage of the total due, and I'd like for them to consider it settled, I might be able to get somewhere. Here's my specific questions:

1.) Should I get any agreements in writing (or will they even GIVE me anything in writing);

2.) Should I pay via money order or cashier's check rather than my checking account?;

3.) Should I bring up the prospect of bankruptcy? From what I've seen, I'd be a strong candidate in their eyes, as I have no home or real assets, and I haven't paid any of my unsecured debt in 130+ days. I don't intend to file, but I wonder if that would be a prompt for them to deal with me.

4.) If I have to play hardball, would it benefit me to tell them that if they won't settle for my offer (which would be around 60-70% on any given card), they can just charge it off and I'll deal with it later? I figure if I wait long enough, I'll be able to settle for the amount I'm offering or less with a collection agency. I know, however, I'd then have to deal with getting two derogatory statements off my credit report instead of one.

Any advice anyone here can offer will help. I'm against the wall on this if I'm going to make something happen, otherwise all of those accounts will be charged off within the next 15-20 days. Thanks.

Well, it appears that with a $3000 loan from your parents you will be able to pay off most of what is owed- or at least 75% of it.

I would suggest you pay off the card *not* owned by Capital One, then put all that is left on the Capital One cards, paying down as much as possible, then leaving a small balance to pay off. And do pay it off. I'm sorry for any problems that may have prevented your timely payment, but just slacking only increases the interest rates on those who do pay their bills on time each month.

Always get it in writing. Always pay through a very trackable source (like Money Orders). Don't get snotty and threaten to declare bankruptcy or tell them to accept what you're willing to pay or get nothing. That just annoys them, and they *will* go after you.

I have seen interest be a negotiable item from credit card companies, in fact all kinds of companies, many times over the years. I have known one friend who faced up to $12,000 debt ($9,000 in credit cards) and they were successful at making reasonable arrangements. The single most compelling thing you have is the fact that you have paid what was originally owed several times over. Call. Be very polite. Be straight with them. Stick to facts as much as possible. Threaten absolutely nothing. Ask questions if you don't understand. If you do get an agreement for a reduced balance, ask for it to be in writing and they will oblige you. And then stick to the deal! Good luck.

As a one time collector, I can tell you that creditors are generally willing to negotiate reasonable settlements. Therefore you should talk to them before you pay anything. But if they won't negotiate, then try paying off as many cards as you can, then try making at least, minimum payments on the ones remaining.

My nephew just went through what you are going through. He told everyone of them he was in over his head and was not able to make payments anymore, but a realitive was willing to help with some money, but not all. He asked if he could make a settlement. Most were OK with it. One gave him a hard time, so he hung up and called a little later a got another person who worked with him and he got it. Do get it in writing. Have them fax it to you. One of his creditors took a settlement, meanwhile it went to another collection agency and they started calling him. Luckily he had written the name and number down of the person he had talked to.
It is very important when you talk to them, to write all information down, and especially their name and how to get ahold of them if there are any problems. Discover card gave him the worst time.
It is hard to believe Capital One gives so many cards. He had 3 of them.

Good luck.