[murph]

one of our larger debts is to American Express, it's in the range of 20K+. Anyway, we thought we had a deal worked out with them, but between the time we made our deal and when were going to make our first payment on said settlement deal, they inexplicably turned our account over to collections. They said that too much time had elapsed from the last time we had made a minimum payment (which is true - we were paying them what we could as we're working to eliminate smaller debts first).

We talked to AMEX and asked if there was any way we could deal with them, because at one point last year this debt was in collections and after making a few payments, they somehow took it back. We even had our own AMEX rep, Bruce.

Any way, the collection company has offered us an even better settlement than AMEX did. We're cautiously excited about this. We've asked for them to provide something in writing, which apparently they're going to do sometime today (they're going to fax a letter to us).

My problem is, if AMEX could pull the debt back before, is there any danger of doing it again? Could we "settle" this debt with the collection agency only to have AMEX keep ask for the remainder? Is there exact verbiage I should look for in their letter they're faxing me?

Like I said, we're cautiously optimistic. By clearing this debt out, this puts on track to be completely debt free (and I mean completely) by the beginning of 2012 at the absolute latest.

 

[Contrary Housewife]

Amex may have had it in an in-house collections center last time, so they could rescind it easily. Or maybe they never sent it to collections, just said so to threaten you. But if you didn't pay as agreed the original owner of the debt won't hesitate to send you to collections. If it was supposed to be $100 a month and you didn't send it on time, bang, you're gone.

Ask the collection agency to 'validate' your debt to them. IE they have to prove they own your loan (or have been assigned to collect it by Amex) You don't know who these yahoos are. Anyone can send a letter saying you owe them money, ask these guys to prove it.

If the deal they offer you is good, take it. They will probably want it in a lump sum, not as small payments when it is convenient for you. DO get the agreement in writing. Never ever *ever* agree to anything with anybody on a verbal basis. You WILL get screwed.

When you talk on the phone, get names and take notes. "Talked to Vern on 10/17/10, say he will send letter asap". Keep all your paperwork regarding this debt in case you need it later.

Don't worry about your credit rating. Both Amex and the agency will try and scare you. You've already blown it and neither of them will "fix" it or rescind any negative reports made about you. So just let it go.

This is a helpful site: Debt settlement advice | Settling your debts

 

[mcsestretch]

The only thing I can add is:

Get it in writing.
Get it in writing.
Get the fact that you got it in writing in writing.
Get that in writing too.

Keep that document forever.

 

[Palooka]

Also if you do settle you will pay tax on the difference that you didn't pay. (it's considered income) They will send you something come tax time.

Agree, get it all in writing and good luck.

 

[NikoSan999]

American Express uses their own "companies". We had one...that one got jerked for no reason. We'd had some words but did ok together. Next guy/girl called they ticked me off. Called first guy from first collection. Yes, they worked for American Express. When I made a payment to them I could go online to American Express and see the amount go down. 0 interest for 6 months and it was extended to a year. Anyway the first guy said he had no clue why it was pulled from his company. I said I don't like him. Pleased this one all to he##
I said I was going to make the payments agreed upon online but the other guy said I couldn't cause Am wouldn't accept them....same thing HE had told me in the beginning.
He started laughing, said believe me, they will take the payment and they'll leave you alone as long as you make the required payment and on time...I said YOU told me I couldn't either...he said yeah, I know, make it online they won't refuse. Also said, while he was officially off the case if I had any questions don't hesitate to call him..he'd answer any thing he could.

Try making the payment online and see if the amount goes down. The collection agency is getting paid a percentage so no they don't want you doing it on your own. If the payment goes down then don't worry.
Print out your receipts and keep them. What are they going to do... take it to court...and tell the judge what...that these people are guilty of making their payment...don't think so.

If you're going to go with the collection agency get all terms in writing and they HAVE TO, BY LAW tell you in writing who they're working for.

 

[Natalia]

well, I have never been in this position, but my grandfather (and then, mother) always said.. Never give collection agencies a cent. Pay back the debt to the original creditor. Despite what the agencies say, the creditor will gladly take your money. By feeding the bottom feeders, you keep them a live and pat them on the back for harassing people every day, mercilessly.

Perhaps AMEX would accept the same offer as collections is offering you? I would try to speak with someone who knows what they're doing at AMEX.