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I have had 7 credit cards and 2 mortgages and never had a late payment until 2 years ago.
In May 2009 Citicard informed me that there were 2 transactions that were suspicious and they were cancelling my card. From this I have had the worst experience. I tried to make a phone payment before my card became past due but a citicard rep would not accept this over the phone. I was unable to do this on on-line as they changed my password and I did not have the new card to input the new data. I never received the new card and they never sent a replacement despite the fact that I emailed and phoned them to let them know.
Throughout I was travelling abroad. Over the next 5 months I called and emailed citicard. No one ever called me back and they only sporadically answered my email messages, though when they did they never addressed any of the issues, simply provide platitudes. I spent hundreds of dollars in calls without being able to speak to anyone who could answer the most basic of questions.
Finally I discovered that the account was with an agency. Obviously not from the helpful folk at Citicard.
I wrote a long letter to both Citicard and the agency outlining all of these issues with photocopies of all of my attempted calls and emails and the lack of response received. I also outlined the negative impact on my credit, the cancellation of some of my other cards that were in good standing and the inability to re-finance my house because of the impact on my credit rating that this account had created.
I am now in negotiations with the debt company acting on behalf of Citicard. My original debt was around $3800. With 2 years of interest and charges this now stands at $4800. They have offered to reduce this to $1950. They will allow me to make an initial payment of $500 and 11 months to pay the remainder. Throughout the repayment of the debt my account will be past due. The black mark will not come off my credit until the end of the 12 months.
I do not know if this is a good settlement or not. My outlook is clouded by my anger at Citicard for the way that they have handled this entire thing. I am angry that if I agree a settlement and make payments for 12 months that this will not be reflected in my credit report until the debt is repaid, and I will be unable to do a refi until then. Effectively costing me $100 per month. I am also aware that this may be a good settlement offer, but I am just a bit blind to it at the moment as I have been dealing with this for too long, and maybe I need an outside perspective.
I hope you don't take this as too much critism, but your post sounds like you think the fault on this is all with the credit card company. So, as you have asked for, here is some neutral perspective. If you already understand what you did wrong in this situation, you can skip to the last 2 paragraphs.
First question is "why, if you were unable to make a phone or online payment, did you not mail in a payment?" Second question is "why did you continue to not make payments for months". You knew you owed the money, and you knew (at least should have known) that this would negatively impact your credit.
Yes, your complaint that they didn't respond to your calls or emails reliably, and you were unable to clear up the problem over the phone may be valid, but I wouldn't consider email to be a reliable way to clear up a problem like this. Too many scams floating around out there, and they probably discard many emails saying "can you send me a new card" every day. Why weren't you able to solve the problem over the phone? I would think if you had an email address and mailing address on file, you could simply say "you changed my password for my account, so I can't get online to pay my bill. Can you send my new password to the email address (or mailing address) you have on file for me?". That way, you don't even have to prove you are you. I assume that since you are traveling, you had someone getting your mail for you and forwarding the important stuff.
So, all of that said, I would say that it is unlikely you will be able to get this removed from your credit report as a company error. That being the case, my opinion is that your best route is to make it go away as quickly and cheaply as possible.
If you can negotiate for the collection agency to have the collection removed from your report (all 3 reporting agencies) after the bill is paid, that would probably be the best you could hope for. You would still have the late payments from the credit card company on there. You said "The black mark will not come off my credit until the end of the 12 months.", which indicates that they may have agreed to this. If they did not agree to this, then the black mark stays on your credit for years. It will show up as a collection that says "Settled for less than full payment" or something similar. If you are concerned about being able to do a refi, you need to know from the lender ahead of time if simply paying off the debt is good enough, or if they still won't approve the refi with the paid collection on there.
If the lender says that just paying off the debt is good enough, and you have the money, just pay off the settled amount in full, so you can do the refi now.
I have had 7 credit cards and 2 mortgages and never had a late payment until 2 years ago.
In May 2009 Citicard informed me that there were 2 transactions that were suspicious and they were cancelling my card. From this I have had the worst experience. I tried to make a phone payment before my card became past due but a citicard rep would not accept this over the phone. I was unable to do this on on-line as they changed my password and I did not have the new card to input the new data. I never received the new card and they never sent a replacement despite the fact that I emailed and phoned them to let them know.
Throughout I was travelling abroad. Over the next 5 months I called and emailed citicard. No one ever called me back and they only sporadically answered my email messages, though when they did they never addressed any of the issues, simply provide platitudes. I spent hundreds of dollars in calls without being able to speak to anyone who could answer the most basic of questions.
Finally I discovered that the account was with an agency. Obviously not from the helpful folk at Citicard.
I wrote a long letter to both Citicard and the agency outlining all of these issues with photocopies of all of my attempted calls and emails and the lack of response received. I also outlined the negative impact on my credit, the cancellation of some of my other cards that were in good standing and the inability to re-finance my house because of the impact on my credit rating that this account had created.
I am now in negotiations with the debt company acting on behalf of Citicard. My original debt was around $3800. With 2 years of interest and charges this now stands at $4800. They have offered to reduce this to $1950. They will allow me to make an initial payment of $500 and 11 months to pay the remainder. Throughout the repayment of the debt my account will be past due. The black mark will not come off my credit until the end of the 12 months.
I do not know if this is a good settlement or not. My outlook is clouded by my anger at Citicard for the way that they have handled this entire thing. I am angry that if I agree a settlement and make payments for 12 months that this will not be reflected in my credit report until the debt is repaid, and I will be unable to do a refi until then. Effectively costing me $100 per month. I am also aware that this may be a good settlement offer, but I am just a bit blind to it at the moment as I have been dealing with this for too long, and maybe I need an outside perspective.
Sorry but it just doesn't add up to me that they randomlu cancelled your card because of " two suspicious transactions" and then suddenly you're past due and they won't accept your money... I suspect there is more to the story than you're telling, and you'll probably be best off taking their deal.
A little more information.
I have 2 credit cards with Citicard. The second one is a business card. My communications via email with Citicard have been through the central system of logging on with this cards' details and emailing securely through my username and password for this account. I was unable to access my personal account through this business account as it requires a separate password. I requested a new password 5 times with no response. This business account has never had a late payment and I have now paid this off and closed the account. The initial account I provided is accurate, but the full ins and outs are pretty long and boring, so I condensed it to the relevant details. To give you a better understanding of Citicards phone responses, the average wait time to speak to someone was 30 minutes, the average number of wrong extensions and disconnects was 2. My final conversation was with a representative whose sole purpose was to repeatedly assure me that I was a valued customer and that there was no problem with my account. (At the same time, this had already been passed to their escalations department).
My main error was in not sending a payment via mail. In all honesty it never occurred to me until way too late, I was totally fixated on trying to get this done via phone and through the internet.
I have never had an issue in paying my debt, and even now am happy to reach a settlement to pay that, but I would like Citicard to acknowledge their part in this sorry affair. I don't want to make a settlement that has me paying back the debt and continue to pay that for years to come with a shredded credit rating. I would like to try and find a way to pay them and get them to take this off my credit report as soon as I can.
You made mistakes and the bank made mistakes. You are paying for your mistakes with a hit to your credit, which hurts you a lot, while the bank is paying for their mistakes by having to sell your debt to collections, meaning they don't receive all their money, which doesn't really hurt them at all, considering the small amount of write off.
Unfortunately, my understanding is that once it is sold to collections, there is no rescinding it. The bank can't just say "whoops, we didn't mean to send that to collections, send it back over here to us and make it go away".
Your best bet, if you do want to get it completely off your credit report, is to try to negotiate a total payoff with both the collection company and the credit card company in exchange for removing it from your (3) reports completely. Get it in writing before you make a payment. You will likely have to make a lump sum payment to both in order to negotiate that.
So you said you owed $4800. The collection company is offering to let you pay $1950. In order to get both completely removed, you may have to pay more than you actually owe, and here is why. You pay $1950 to settle with the collection agency. That means that they bought the debt for less than that, say $480 (ten cents on the dollar). So the credit card company is out $4320. So you may have to pay them that much to get them to remove it from your report. (I don't know what the purchase rate is on this stuff, I just picked that number out of the air)
Keep in mind that they do NOT have to agree to remove these items from your reports. You have to convince them that it is in their best interest to do so (they will get all their money at once, and save a lot of time and resources not having to continue to chase you down in the future, etc). And make sure, if they do agree, that you get it in writing.
Note: I am not an expert in any of these related fields, so this is just my personal, common sense advice. It may or may not work.
I am shocked you had such a hard time getting a live, decision making person on the phone at Citibank. I switched from BOA to Citibank a few years back and I have the direct telephone number of the gentleman who set up my account, and he also provided me the shortcuts needed to reach a live person if I need to call the 1-800 number instead. I am not a "high net worth" indiviudal, either. I have found their customer service nothing short of excellent....so I really don't understand how you had such difficulties changing your password (just call the 800 number and answer your "secret" questions correctly and they will re-set it right then & there).
Just take the settlement and write the check asap.
Your credit rating will likely take a ding (50-100 points or so), but it's unlikely Citi will be able to make any special "notes" on your credit report since they have handed off your outstanding debt to a collections agency.
I'm not a big bank supporter in that I don't agree with most of their fee/revenue structures, but you really should have handled it better by calling, not emailing. And by continuing to follow up and finding a way to make payments via phone or snail mail if the electronic systems werent working for you.
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