Settle All Credit Cards At Once? Or Keep Paying Some?

[loansafe91745]

I've got a total of $50k debt on 3 credit cards:

1. Chase: $20k balance, 3 months delinquent.
2. US Bank: $14k balance, 1 month delinquent.
3. Navy Federal Credit Union: $16k balance, current.

If I can settle with the first two, I can probably afford to pay off the NFCU balance in 3-5 years. But since my credit score is going to get damaged anyway, should I go ahead and try to settle with NFCU too? It looks like a lot of people keep some credit card payments current while settling others. Why? What are the pros and cons?

I'd appreciate any & all thoughts....

[RyanJP]

I've got a total of $50k debt on 3 credit cards:

1. Chase: $20k balance, 3 months delinquent.
2. US Bank: $14k balance, 1 month delinquent.
3. Navy Federal Credit Union: $16k balance, current.

If I can settle with the first two, I can probably afford to pay off the NFCU balance in 3-5 years. But since my credit score is going to get damaged anyway, should I go ahead and try to settle with NFCU too? It looks like a lot of people keep some credit card payments current while settling others. Why? What are the pros and cons?

I'd appreciate any & all thoughts....

The major pro of keeping at least one card current is that you will have an active credit card in good standing helping your credit score. If you settle all three, your credit will take a harder hit, AND you will have no available credit for emergencies (assuming these are your only credit cards).

What I would do: Stop paying the two that are delinquent, and shovel most of THAT money towards paying off the NFCU card. Once you are around 6 months delinquent on the other cards, they will begin considering either suing you or selling your debt to a junk collector agency. This is widely considered the butter zone for obtaining the best settlement terms.

[BigBlok502]

Unfortunately I do not think you can pick and choose. When you stop making payments, they close your account so you cannot use the credit cards anymore. The other credit cards periodically check your credit report, when they see you are behind on payments they will lower your credit limit to what you owe, and as you make payments they will lower your limit more - so much for having a credit line now.

I've been there, done that. The phone calls are relentless, sometimes multiple times a day from the same creditor. As you get closer to the 180 day charge off mark you will start to receive settlement offers. IMO, that is the time to settle with a CC company.