[MoreCreditIssues]

I came across this article online and I'm really trying to better my credit due to old debt (nearly 3 years old). It talks about sending a check with a conditioned acceptance written where it must be endorse along with a notorized letter; it implies that this would make it so that the offer is likely to be accepted and if they take the money they have legally agreed to the terms talked about below right? This would successfully return the debt from a negative status to a neutral status would it not?

If it makes a difference I'm paying the full amount so they should/would likely be more tempted to accept it.

Here's the article (Credit Repair Do It Yourself)
This is easily performed by writing a letter to any creditor and submitting a payment under restricted endorsement. How this works is you write a check to the creditor for the amount you are willing to settle for and on the back of the check where the creditor must endorse the check to get paid you write:
If paid, in full settlement of disputed debt and subject to conditions of Settlement Offer dated xx-xx-2008.

You will need to send a letter of settlement to the creditor and attach the check to the letter. Assume it is to Ford Credit use the following:
xx-xx-2007
Ford Credit
RE: account # 1000676 Sam Jones, SS# 555-55-5555

This letter is an offer of settlement and full satisfaction of all amounts claimed by Ford Credit. I dispute the validity of the debt amount claimed and offer to pay you $xxx.00 in settlement of this disputed debt. I make this offer conditioned upon your promise to remove any negative report to any credit bureau for this account #1000676. You may accept this offer by presenting my attached check for the settlement amount.

Any advice will help. I've made my mistakes but I need to do something to help with the bills now and my huge interest rate (29%) on my car isn't working anymore. I can afford it but the car is getting older and need to be upgraded before it cost me more in repairs, so better credit for a new car is my best bet!

[Justice Matters]

If you are going to send a creditor monies to settle a matter it is usually best to have a mutually signed settlement agreement in place first.

If you are able to pay the full amount you may be able to use this a negotiating tactic since many creditors will discount any outstanding debt if a lump sum payment is made. Find out what they are prepared to do for you if you offer 80% of the debt and then negotiate additional benefits if you pay the 100% of the debt (ie. Removal of any negative information from your credit record).

Any written communication in advance of a settlement agreement should continue to state that you are not admitting the debt (much like it is written in the sample text you provided) otherwise any written admission could re-start a limitation period.

In Ontario, where we practice, the courts have ruled that a creditor may disregard a debtor's attempt to unilaterally impose a settlement but the creditor may deposit any checks send to the creditor for such a purpose.

[MoreCreditIssues]

Thanks for the advice. It would have been nice to not have to deal with them much but I suppose any effort I can make to improve my credit is worth a bit of pain. Would it be better to call them first or just send the certified letter with the request?

I know that if/when we make an agreement I would need to make sure it is in writing. But, as far as getting the details worked out it would be quicker and easier if done in the same day over the phone. Could a fax from them rather than a letter hold the same value as a legal agreement or should I wait for the slow but sure mail to get it to me before paying? If possible same day contact and payment would be nice, thanks!

[Fr_Chuck]

Yes first notorise merely proves you signed it, it does not make it any more legal.
And any note on the check, esp in the days where they don't really sign the back but use electronic machines to accept checks ( or stamp them)
There are many cases where these types of things have not been accepted.

[ScottGem]

I'm confused. If you are paying the outstanding debt in full then why the rigamorale? You should have a statement from the creditor stating the outstanding balance. You keep a copy of that statement along with your cancelled check. The creditor enters a paid in full notice with the credit bureaus and your credit rating improves.

The only reason for what you refer to is if you are paying a negotiated settlement and then, as Justice said, you should have an agreement in writing before hand.

At most, write payment in full in the check memo.

[MoreCreditIssues]

The run around is about getting it listed as a neutral debt. Or, at minimal a lesser degree of negative to be reported.

Fr_Chuck; said in a different post of mine a ways back:
Also if you are going to pay them in full, before you pay them make a deal, you will pay in full, if they will make the account paid in full on the credit report and remove the negitive reporting. Get it in writing.

They may or may not agree, but always worth a try.

So, I'm trying to make use of the potential to get the negative strong hold it has on my score by working out an agreement. I paid off a few things since my original post and they actually hurt my credit score once paid; I even paid them in full. I'm looking to avoid that with these last two debts. May not be the most ideal way of getting my score back to where it once was but when has debt ever been "ideal"?

[ScottGem]

Ok, then you get an agreement in writing that upon payment in full they remove the negative rating of your account.

[MoreCreditIssues]

Thanks, now how should I contact them?

First- Call or send a letter?
Second- Do I offer to pay the debt in full for removal right away or hold off?
Third- Get what ever agreement in writing right? Does this mean I wait for it to be mailed before I pay it? Could I have the agreement faxed to me; would a fax hold the same value as a written letter?

Finally, after I have an agreement, written proff of agreement, and pay it, how long do I wait to verify that the terms of the agreement have been meet?

If they refuse to remove the debt is there another status I can negotiate that will have a lesser effect than others? Thanks

[ScottGem]

I would do everything in writing. And yes a Fax or e-mailed PDF is sufficient as long as it includes a signature.

You don't send any payment until you have a signed copy of the agreement.