This is also called an ACH transaction, and it means you provide them the bank routing number and account number off your checking account. Let’s say you are talking with a third-party agency in a different state and they have agreed to a 40% settlement. We saved our client $16,072.36 (a 60% discount on the amount claimed due). What Are Your Spending Habits? The corporate cards are generally issued to the corporation itself, even though your name appears on the card, so generally it is not advisable to attempt settlement on this type of account, as it could have a direct effect on your employment status. For example, if you are two payments behind, the representative will generally not discuss settlement yet and will only speak in terms of different payment options. Derogatory entries are supposed to drop off after 7.5 years. It’s simply a part of the collection culture that developed at American Express, which positioned itself over the years as being “different” than Visa or MasterCard. Will this change when Amex hand over the former employer’s balance to the agency? In such situations, the risk is greater, so we accept a higher figure than we might otherwise. If FFN settles it for you, then they would be settling through GCS too, no difference there (aside from their fees). Although, when the account went “rogue,” the interest alone was above 30%, in addition to late fees. If I can get the money from the account that I have with Freedom Financial, should I try to settle directly with GC Services?  If you have it in writing first, it’s ok to do this. The one unbreakable rule in debt settlement is to GET IT IN WRITING FIRST, before you pay! Can they be applied against the settlement amount? I have a personal Amex blue card and corporate Amex green card through my employer. The first rule in settlement with American Express is therefore to avoid any sort of tactical “games” like debt validation, which are generally unnecessary anyway. These are one-time funding sources, in other words. If you’re like most clients, you’ll feel a tremendous sense of empowerment at achieving a successful settlement. American Express Charge Cards must pay off the full balance due each month ; This service is not available for American Express Corporate Cards A charge-off can have a cumulative negative impact on your credit because of the months of late or nonpayment notices followed by the charge-off and the debt collection report. The company converted to a bank holding company structure in November 2008 in order to become eligible for Treasury Department assistance under the infamous “TARP” program. It just has to cover the essentials – the account number, amount of settlement to be paid, any payment installments listed clearly with due-dates, and the transaction has to be defined or referred to as a “settlement,” or “settlement-in-full.” Simple enough! Once you reach your goal, accept the settlement and take the deal off the table. This creditor rarely sells its accounts, no matter how old. This isn’t a matter of “trust,” or “distrust.” It’s just simple common sense that any agreement modifying your contract with American Express (or any other creditor) must be in writing. Be aware that you’ll hear various kinds of options presented to you depending on how far behind you are on payments. It’s trivially easy for an original creditor to produce a stack of monthly statements two inches thick and mail it to you. It can be a huge game changer financially, as well emotionally. Thanks a lot for any insight! If you’re drowning in debt and want some expert advice and coaching as you negotiate through your settlements, please visit us at ZipDebt.com. american express des:settlement id:987654321 indn:widgets, inc 987654321 co ccd When looking at your bank deposits screen, the total for American Express transactions will be shown as a negative item in the details of the deposit. Erick, it’s quite common for Amex to assign delinquent accounts to GC Services for collection, and that often happens when the account is around 90 days late. Listen carefully to these proposals and note them down. 11-MD-2221 (NGG)(RER), along with the … It doesn’t have to be long! Amex does not have my phone number or address, only the email address. We feel much better now knowing that the money is going to the original creditor and not to a collection agency. I have two accounts with American Express. But there is a huge difference between income and assets, and many consumers who can’t sustain regular monthly payments due to lack of income or other financial hardship are able to use some of their dwindling savings for the purpose of settlements. Be smart. (1) They move the file quickly to outside collection agencies compared to other major credit card issuers, and many of those assignments are to in-state law firms. I am sure I signed something, but the corporate card is not the one I have a balance on. Yes, it is totally possible for you to negotiate with GCS on your own and reach a settlement. I have a corporate card that my former employer claimed I had personal purchases on. If you have a debt collector balking at putting the settlement in writing, then just put your foot down and insist that you will only proceed on the basis of a written agreement letter. As the negotiation proceeds, resist your initial urge to jump your offer right away, and give it some time to see how things go first. Debt Settlement Solutions: Slow Torture vs. Fast Relief! It’s common to carry a personal account and then receive one issued by your employer, to cover work-related travel expenses, per diem costs, and so on. Advice? I have a personal Amex account and a corporate Amex with my new employer, so far they don’t seem to get affected. Charge-offs usually occur if your account received no payments for six months, although some creditors can initiate a charge-off after 120 days. Insolvency Calculator for IRS Form 982 Now Available! This is also called an ACH transaction, and it means you provide them the bank routing number and account number off your checking account. Yet it’s highly unlikely you will encounter this situation with respect to any type of American Express account. I do take your point that they are usually lenient with delinquent cardholders seeking to restore the account to good standing. You’re in a financial crisis and want to obtain as deep a discount off your balance as possible, but you also have to be mindful of the legal risk that mounts whenever you are behind on payments with a creditor. I’m not too concerned with it, it is my “stupid tax,” and a big one at that! The reason this matters is because there are some important differences that need to be taken into account in terms of the “collection culture” at different types of creditors. Only $29! We are in a debt mgmt program with consumer credit counseling and American Express is one of our debtors. Get help with these accounts. The American Express billing statement class action lawsuit stresses that because of American Express’s non-compliant disclosures, Zevon and the potential Class are entitled to recover up to $1 million in statutory damages. Debt validated, and account moved to an in-state legal firm for your troubles! Will getting in to trouble with my personal Amex card get me into trouble at work if I have a separate corporate card through work? Debt settlement is just as much about managing risk as negotiating savings. Over time, and with a series of negotiation calls, it’s possible to reach a settlement agreement on your American Express card that you can handle. American Express sued my client and the business for the full amount due, plus court costs and attorney’s fees of $630. - Jenie, Attorney General Presentation About How to Stay Off the Radar. American Express is not a “bluff” creditor, so we do take any legal threats from them seriously once a file has escalated to placement with a collection attorney firm (licensed to operate in the client’s home state). If you have it in writing first, it’s ok to do this. If they are not a law firm and they are in some other state than yours, then the situation is low risk compared to assignment to a law firm in your state. Nice article..  If you are in a financial crisis, that is enough, and you just need to be patient and persistent. I was sent a list of charges but believed I was not responsible for half of those charges. It’s simply a part of the collection culture that developed at American Express, which positioned itself over the years as being “different” than Visa or MasterCard. You are aiming for a financial outcome that you can live with, not a world-record low percentage. If the account is presently being reported current standing, then it will probably show as a closed but positive account. However, when you are trying to settle an American Express account, it would be a major tactical mistake. Any thoughts on this? This isn’t a matter of “trust,” or “distrust.” It’s just simple common sense that any agreement modifying your contract with American Express (or any other creditor) must be in writing. This debt was completely my doing, not American Express’s, but I’d certainly take a reduction in the balance due. Don’t play games or make up stories about your situation. You can always increase later. View the outcome, letters, cost, time to complete. Yet it’s highly unlikely you will encounter this situation with respect to any type of American Express account. There are NO exceptions to this rule. Once the money received from a one-time source has been expended, there is no more to replace it. If you are smart try to pay it in FULL, Amex will give your card back with half the balance $2500.00 and you can work your way up. I believe it has to be looked at on a client by client basis, rather than taking a blanket position across the board. The article seemed to say that. Voila. Joe, I recommend you check with your debt management provider to see if American Express accepted their proposal. Money Personality Quiz and Test. I have an american express credit card. If you are negotiating settlements with multiple creditors, it’s better to set up a special checking account for this purpose. But such funds can be put to excellent use in retiring a major credit card debt, when otherwise the customer would just be facing an unsustainable situation (which in turn often leads to bankruptcy). When it comes to settlement with American Express, there are some specific facts about this creditor that you should be aware of. One more important point about settlements with American Express. Charge-offs are considered a very negative credit event and cause significant damage to credit scores. These are one-time funding sources, in other words. Don’t be greedy. However, the impact lessens as the listing ages, and negative credit information is removed from credit reports after seven years. I might leave the country permanently in a couple of month, can I tell the agency that and try to settle for less? I always recommend proactive telephone contact with creditors, and American Express is certainly no exception. American Express is the contractor. In the five years since I originally published this article, I’ve received numerous questions and inquiries about negotiating settlements with American Express, and talked to hundreds of consumers who were finding it difficult to reach an agreement even with all the advice I had presented in the article. Understand that the majority of settlements with American Express are negotiated through these third-party collection agencies. 91st day went to Zwicker....120 days to Apothaker with 0% offer to settle full balance or 55% settlement..lump sum...i'm at 150 days without a payment....close to chargeoff. If you’re facing a legitimate financial hardship and can’t make the minimum payments on your American Express credit card one potential solution is to negotiate a lump-sum settlement for less the balance owed. The reason is because they have the documentation. Sometimes these alternate programs can include low interest rates and lower monthly payments, and for some consumers this level of relief alone may provide sufficient breathing room to get a handle on their financial situation. If you’re more than three payments late, the odds are good that you’ll be hearing from an outside collection agency. American Express discount rates for retail stores and restaurants will downgrade (meaning the rate increases) if a transaction is keyed-in rather than swiping a card, but most rates are the same regardless of transaction method. You must have a letter in-hand before you make payment on your settlement. You are happy with the result and you can fund the settlement ok.  Milton here from Complete Debt Solutions – What Amex are telling you is they don`t recognize this company or they have “a” history. The 36-48 month programs offered by most debt companies have high risk for collection lawsuits. American Express denies these claims. It’s quite common for American Express to assign their accounts to third-party collection agencies well before the point of charge-off at 180 days late, often as early as 90 days late. One more important point about settlements with American Express. Where the risk is lower, we can hold out and try to do better on the settlement percentage. Many websites offering advice on settlement of credit card accounts recommend sending “debt validation” notices to collection agencies or creditors, in theory “putting them on notice” that you are aware of your consumer rights and demanding copies of their backup documentation. I think the article will give you the basic answers to your question. If you are not carrying a balance on the corporate account, then the worst that could happen is closure of that corporate card due to default on the personal account. American Express is not a “bluff” creditor, so we do take any legal threats from them seriously once a file has escalated to placement with a collection attorney firm (licensed to operate in the client’s home state). "If you already have a low score, [a charge-off] will still drop your score but by fewer points," says Ryan Greeley, Denver-based editor of the Better Credit Blog. 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