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I have a Wells Fargo credit card I haven't paid on since July of 2018. They been send in letters and the last one said if I don't make it payment by 1/31 then it's going to collections. At this point since they already have me late on payments is it better to let it go to collections or start paying off?

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Can you afford to pay it off and pay for housing, keep the lights on, and some food in the icebox? Anything you can sell to raise cash? Cut expenses such as cable, phone, go to a bare minimum cell phone plan. A collection would just make it two bad entries instead of just the one from Wells Fargo.

 

How much does WF want to keep it in house?

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Can you MAKE payments if they agreed to terms?  If so, then you MAY want to look at trying to get them to agree to a Rule 5000 reaging.  This would eliminate the negative reporting while also putting you back in their good graces.  It is ALWAYS easier to try and work with an OC, especially when they still have the paper in-house...

 

However, since the questions posted by Indy have not been addressed, no additional guidance can really be offered...

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I agree with Centex on this one. You would be better served in working out a repayment plan rather than what will probably follow: 

The phone calls

 The letters

The potential of getting sued for not only what you owe but also interest, lawyers and court fees

A default judgment comes with additional fees if the plaintiff isn't payed and in many states can be renewed for many years making it almost impossible to repay the debt.

In some states they can take your property, empty your bank accounts to satisfy a judgment if they want to collect

Years of  bad credit on your credit report that could possibly get your into trouble on the job

Years of rebuilding your credit

 

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update on topic. They want to do a reage on card. The first 3 payments would be $86 then $60 a month after that to pay balance off. Card stays closed but account reports as current. I can afford the payments now. they wouldn't offer a cash payoff settlement.

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On 1/31/2019 at 7:52 AM, nverlast1 said:

update on topic. They want to do a reage on card. The first 3 payments would be $86 then $60 a month after that to pay balance off. Card stays closed but account reports as current. I can afford the payments now. they wouldn't offer a cash payoff settlement.

A closed account without derogatory reporting is the second-best outcome that you could have hoped for.  Obviously the best would have been to have the account open and available, but...c'est la vie.

 

Make the payments they want to get it 'current' and then pay it off as quickly as possible since a closed account with a balance will hurt utilization components of the score. 

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