you can make settlement arrangements via monthly payments, but don't expect much of a reduction (if any). You might be able to get them to freeze interest, but the big reductions people talk about when it comes to debt settlement are achieved through lump sum payments.

How old is the debt and when did you pay last?

I wish to settle the debt via payments but not sure if this is just a scare tactic or legitimate action. The debt is from an outstanding credit card bill that Visa refused to settle with Credit Canada because they wanted more interest when they knew that at the time I was unemployed and did not have the resources to make the mimimum payments.

"Anything wrong with what I have written?" You're "damm tutin" there is.

You are living in a dream world if you think CCL Financial or CitiFinancial will make any adjustments to your Credit Report no matter how much money you are willing to pay.

For starters, if a creditor has written off a debt as a bad debt, it doesn't mean that the debt does not still exist. It does. What this means is that the debt has either been assigned to a collection agency to collect or has been sold to a debt buyer. And when this happens, it is given a R9 rating which is the worst rating an account can receive. This "Tradeline" account (i.e. CitiFinancial ) will remain on your Credit Report for 6 years from the "Original Date of Default with the Original Creditor" until it is purged. The purging rules are the same for both Equifax and TransUnion.

When an account has either been assigned to a collection agency or sold to a debt buyer, that too is also reported to the Credit Bureaus and is reported on your Credit Report. That means, at any given time, a Credit Report will show both the "Tradeline" and the account reported as a "Collection Account" or as a "Purchased Debt". Both the "Tradeline" and the "Collection Account" or "Purchased Debt" will purge at the same time.

If you negotiate any payment on this account to CCL Financial, it will only be marked as "Paid" or "Settled". Even if you paid the account in full, it will NEVER be shown as "Paid in Full" because you defaulted on this account. Accounts marked as "Paid as Agreed" are those accounts which have been paid as per the Agreement signed with the lending institution or the credit grantor.

Since you made a recent payment to CCL Financial through your bank, that will now reset the limitation period for a further 2 years in which CCL Financial can commence a legal action ( i.e. sue you ).

Any negotiated settlement that you make with CCL Financial, regardless of the amount will NOT improve your credit. Your credit took a major "hit" when you defaulted on the account with CitiFinancial and there is nothing that you can do currently that will improve it.

Don't expect CCL Financial to mail you a statement detailing the balance owing anytime soon. It just isn't goin' to happen. A collection agency or a debt buyer's obligation is not to massage a debtor with "paperwork". Their job is to extract as much money as they can from the debtor in the fastest possible way. And if that means commencing a legal action, so be it.

With the rate of interest that you were paying to CitiFinancial, probably around 29.5%, that same rate of interest is currently compounding on your debt with CCL Financial. That is why your debt is now "ballooning" upwards and will continue tro do so until you resolve this debt with CCL Financial.

Remember, collection agencies and debt buyers have heard all the "hard luck" stories that debtors have told and your's is just another one "coming down the pipe".

No "Tradelines" or "Collection Accounts" will never be removed from a Credit Report before they are purged because they show the history of the account to any reader of your Credit Report unless this reporting is for the wrong person. Unlike in the U.S. where a debtor can make a payment to a collector in exchange to have a collection account deleted, Canada does not engage in the same practice.

My comments may seem somewhat harsh but it is time for you to face reality. With a current debt owing to CCL Financial of over $5,700 and increasing daily and now that you have extended the limitation period a further 2 years by making a recent payment, the time is "ripe" for CCL Financial to commence a lawsuit against you. And should they proceed and obtain a judgment, that judgment is valid for the rest of your life, or until it is paid. Suffice to say, get this debt settled ASAP. Unless you do so, you could be facing wage garnishments into the future.

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Educating one Consumer at a time

It should also be noted that when one makes a settlement agreement, it must stipulate that the unpaid portion of the debt can not be assigned or sold to another collection company otherwise it just starts all over again with them.

So as an example....if the debt is 5000 and you settle to pay 3000. the remaining 2000 can not be assigned or sold to anyone else for collection.

That must be included in writing in a settlement agreement.

First off, just so you are aware..just because your report says written off does not mean the debt no longer exists. It is just an accounting practice that is used by lenders to keep books in order. Second, even if you pay this debt off now that will not change the credit report, it will remain an r9 on that loan for 6 years. The best they will do is add a note saying paid....not paid in full.
The whole point of a credit report is to be complete and accurate.
This is so future lenders will have an accurate document to asses your credit worthiness. They will not change it unless you can prove a mistake or some other inaccurate info on it.

By that payment going through by accident as you put it leaves another 2 years in which to sue....which they will not but it makes for a good intimidation tool.

Don't expect them to accept your offer now as you are really in no bargaining position as you would have been if the Statute had run out.

Based on what you have said....you seem to be almost judgement proof, however they could still possibbly get a garnishee on your wages should they decide to sue, which again is very very unlikely.

Hello,
This is my first post. i found this site to be incredibly helpful to others and hoping it will be able to help me.
I took out a personal loan through Citi. I paid the loan regularly until I was transferred with my job and my budget was squeezed to the point of impossible. I was a single parent with 3 kids and sole supporting income.The loan was transfered to collections at CCL and I told them I don't have the money and cannot make an arrangement with them. I made one payment and then the next month, I lost my job and was intermittently employed through 2010. I went to my bank to apply for a CC and they told me that CCL had written off the debt and it was showing bad debt on my Equifax. CCL stopped contacting me after I lost my job nor did they ever send statements or payment due, etc. I checked my Equifax myself and it did say this. I was afraid to call CCL because I thought if I did, they would start harassing me again (and I had just gained new employment...they were constantly calling me at work before)
and if they wrote off the debt I was told I would have to wait several years for that to come off my credit. So my credit is done, basically.

I went to make a bill payment 2 weeks ago, and it is coming up to 2 years since my last payment, and 10 days from the statute of limitations. The bill payment accidentally went to CCL and I called the bank even, saying they wrote off the debt as far as I knew and requested they reverse it. Next thing I know, I am getting a letter that I have until May 21st t o pay 5700.

I don't have 5700 but I will have some of the money soon. As soon as I opened it I called right away because they said they were going to sue me. I told her what happened and if I do owe the money and if that will help my credit, then of course I will pay. I talked to my partner and he advised to try to do a settlement. I wrote this letter:

This is to inform you that I,XXX as discussed today, May 14th 2012, would like to settle my outstanding CITI debt with your company.

First, I checked my files and I do not have any documentation that CCL Financial purchased the loan from CitiFinancial. Could I please get this asap?

I acknowledge receipt of your letter today. Please note, your letter makes reference to prior attempts to contact me. This is incorrect. In actual fact, I have not heard from CCL within memory, and I have not moved. I should reiterate, as I mentioned on the phone, that my banker had advised me that the amount of the CITI loans was showing on my credit report and written off, and that in good faith no payment would be expected or required. This seems obvious in light of CCL's failure to contact me at any point in recent memory.

Your letter also cites an outstanding debt balance of $5,723, according to your records. As this amount is over $2,000 higher than my original debt, I would like a full statement mailed to me which outlines the computation of my account in detail including principal, payments to date, and interest rates.

I am interest in repaying the debt, but unfortunately, I lost my job in 2010 and have experienced intermittent employment since. As a result, I have attempted to start my own business and am finally starting to see some additional monies. I have experienced almost 2 years of financial hardship and would happily apologize to my creditors for delays they have experienced. in being able to pay for the debt.

I stress that I currently have under XXX in my bank account and am desperately waiting for payments to come in. My available funds are limited and as discussed, I do not have any family members or friends that could provide me with this money.

So, I propose an additional amount of $3,000 to settle the outstanding CITI debt amount. As I do not own a home, have limited assets, this is a stretch beyond my means right now but obviously recognize this is in my best interest to clear the outstanding debt (that I thought until today was written off). As soon as I receive payment from my invoices, I can provide this money.

I also request the following conditions be included as a part of my settlement offer:

My account(s) with CITI and any collection agencies will show "paid in full" with no future money, penalties etc. owed on the account listed above.
Any lawsuit filed against me will be cancelled, and no future litigation related to this account will be filed against me.
All the negative listings related to my account, will be removed from the credit bureaus within two weeks of the cheque clearing, as discussed, and this promise put in writing (not just verbally over the phone). To be clear, you would report the account paid off in full and closed, without any residual adverse elements.

I have enclosed a copy of my invoices outstanding for your consideration.

If you are willing to accept my proposal, then please provide a written commitment to that effect and return a copy of the agreement to me.

As soon as I receive the signed agreement from you, and my clients have paid as discussed, I shall send you the money order in the amount I have proposed.

I look forward to resolving this matter with you.

Sincerely,

My question is, if and when this is paid, how long until my credit starts to recover? Now that life has turned around, I would like to purchase a house in the next year and what can I do?
Also, does everything look right and what can I say to CCL to get through to them? I know they deal with a lot of the same stuff every day, even when I was saying I would be willing to settle the debt she still was firing off at me demanding I borrow money off my family, that I have until the 21st and then I am sued, etc etc etc etc.

Is there any other advice on this? Anything wrong with what I have written?

Thank you,