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How to Negotiate Debts with Capital One Bank - YouTube
Channel: Michael Bovee
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Hi there, I'm Michael Bovee with
consumerrecoverynetwork.com, and
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thanks for tuning in to
our YouTube channel.
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Today, as part of our focus on
how to deal with each individual
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bank that you might struggling
to keep payments current with,
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we're gonna talk
about Capital One.
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Capital One is unique in and
of itself as far as the size
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of credit card issue
where it is in the US.
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For example, they are probably
the most active quote,
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unquote subprime credit
card issuer out there.
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Back when we had our recent
recession a few years ago,
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credit card banks saw their most
dramatic default rate ever.
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And a lot of the subprime
issuers were the ones that saw
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the worst, and they folded up
and got absorbed by big banks.
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And there really hasn't
been anybody to step into
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their shoes.
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Capital One is
an exception to that.
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They issue a lot of
starter credit cards with
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lower credit limits,
maybe higher interest rates.
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They issue credit cards to
people that are trying bounce
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back from negative credit,
that kind of thing.
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So they're really cool in that
way, and then they're not so
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cool in other ways for
the folks that fall behind.
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So let's talk about that.
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When you're dealing with
Capital One, and let's say
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it's the only account you're
struggling with, that's great.
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Reach out to them direct or
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resolve the account
with them directly.
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The more accounts you have,
though,
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credit cards specifically,
you wanna maybe talk with
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a credit counseling agency
first, a nonprofit.
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There's over 100 of
them nationwide.
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You can call the hotline on
the screen and press 1 and
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get connected to the largest,
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oldest national nonprofit
credit counseling agency and
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talk about how you can get
your payments reduced for
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all of your accounts
consolidated into one.
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But if you're just
dealing with Capital One,
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you can usually handle that
on your own, and here's how.
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Calling to Capital One while
you're current isn't gonna go
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much of anywhere productive
as far getting some kind of
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reduction from them,
monthly payment reduction.
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But if you're just even
a week late and you call and
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talk with a representative
at Capital One,
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they know that you're late.
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They see that and they're gonna
treat your account differently
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than if you haven't missed
a payment to them yet.
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Let's say your balance is 5,000
and you're gonna be short, or
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have been, and haven't made
your minimum payment for
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a few weeks or
even a couple of months.
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They can talk to you about
hardship plans that they have
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where maybe it's 3, 6, 9, 12
months long and you are able to
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stay on that reduced monthly
plan for that period of time.
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And when you come out of it,
you'll be back to the interest
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rate and
minimum payment that you were.
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And by the way, that is how
they accomplish a lower monthly
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payment, is that they're willing
to reduce your interest rate,
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whether it's temporary or
long term.
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That's how they work with
the credit counseling agencies,
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the long-term plans.
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You can sometimes still get,
in certain situations,
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a lifetime of the balance
repayment plan,
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lower repayment plan, that will
not go beyond 60 months, or
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5 years, they can't do them
longer than that, on your own
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rather than having to go
through a credit counselor.
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I just don't see them as much
with Capital One anymore, so
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be aware of that.
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The types of monthly payment
reductions that they're gonna
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give you are typically gonna
be for a short duration.
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Now what if you cannot
even pay your minimum,
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or even a reduced
monthly minimum,
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from Capital One and
that's gonna be the way it is?
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In other words, stuff has
happened so negatively in your
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finances that you're gonna not
be paying them for many months.
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Sometimes you look forward and
you're not gonna be able to pay
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them because you're out of
work medical-wise, laid off,
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still looking for work,
exhausted your savings.
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And something's gotta give and
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the credit card payments
are finally gonna give.
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Long-term looking and
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planning to resolve Capital One
account is important. Why?
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Because currently Capital One is
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probably the most
litigious credit card
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bank in the United States,
and have been for some time.
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I think they file the most
credit card lawsuits in
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Hampton County Minnesota,
Cook County, Illinois,
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Minneapolis, Chicago.
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They sue a lot and
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they sue, I've seen these just
recently, for $400 dollars.
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As little as $400 will trigger a
lawsuit from an attorney working
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for Capital One.
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So knowing that, you should be
targeting them for your earliest
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opportunity to save up money,
whether you're saving it up
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monthly or tapping a resource,
selling that ten speed in
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the garage you haven't ridden
in ten years, whatever it is.
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You come up with the money and
you can reach back out to
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Capital One and look to resolve
the debt through negotiation.
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When you're calling them,
we cover negotiation,
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by the way, quite a bit on our
YouTube channel and a ton on
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the consumerrecoverynetwork.com
website.
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I've got a couple of pages
up that are dedicated
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to settling with Capital One at
different stages of collection.
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But when you reach out to them,
they are going to look for
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reasons why you're
unable to pay.
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So whatever it was that led
to your inability to pay,
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does that condition still
persist, has it gotten worse?
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Oftentimes people
that negotiate and
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settle are borrowing
the money from family and
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friends to do it in
the first place.
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And be transparent
about all that stuff.
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The worse it is to be you
financially, the more damaging
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it is, the impact of whatever
it is you're going through and
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the need to borrow money even.
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That's the kind of
stuff you share.
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The stuff that makes it good to
be you, it was back then, it was
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two years ago and I fell behind
and I couldn't pay and now
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things are great, got a new job,
I'm calling to resolve this.
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You're not gonna get
much of a settlement.
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So focus on the things that make
it hard to be you financially,
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and don't go into
details of anything that
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talks about you bouncing back or
any kind of credit goals or
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credit reporting goals or
anything.
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That's just a tip of the hat
that they should hold out and
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get as much money
from you as possible.
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And once an account has gone,
say, six months past due,
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the credit damage is done.
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You're not gonna get
any brownie points for
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paying something back in full at
these inflated penalties, fees,
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interests, amounts
on your credit.
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So ideally, at that stage
with the damage done and
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with the inflated balance,
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trying to negotiate the lowest
pay-off you can is a good idea.
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Here's an issue though.
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When you're settling
with Capital One, and
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it's been this way for
many years now,
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your realistic targets
are typically gonna be half.
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They don't really settle for
less than 50%.
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Let's see, it's December 2015,
I think I saw one settlement on
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a Capital One account that
was under 50% this year.
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I see a lot of them.
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And or even last year,
if memory serves, one, and
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it was a really old account,
like five, six years old.
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So if your account isn't that
old, you have no shot likely of
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getting under 50%, and I don't
care who's collecting on it.
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It could be with Capital One, it
could be with just a regular old
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debt collection agency
that they work with, or
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one of their collection
attorneys that they work with.
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Your targets are realistically
gonna be half.
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Sometimes you won't
even get half.
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Sometimes they
won't go that low.
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Sometimes they'll go to 60%.
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You could call Capital One, and
you could be five months and
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two weeks late, and
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they're getting ready to charge
off the account, in other words,
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take a loss on it, and
you can't get any settlement.
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There are situations where
Capital One just flat out will
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refuse to work with you.
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There's kinda criteria
that I can cover, or
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I can cover on a consult
if you wanna call me, or
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you can type in the comments
below about your issues.
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If they did refuse it,
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I'll ask you a couple of
specific questions and
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we can get to the bottom of why.
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But don't think that you'll
never be able to settle it,
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just because they wouldn't at,
say, five months and two weeks.
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They will often
approve settlements or
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you're kinda pre-approved.
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If they send it to a collector
or an attorney for
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collection where negotiating
at 50% with those guys is
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probably more likely to happen
even though Capital One wouldn't
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do it with you directly.
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So a couple things, now that you
know kinda the lay of the land
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and what kind of
percentages to target.
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And by the way,
don't speak in percentages.
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Speak in round numbers in and
around 50%.
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Go lower obviously.
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If they come back at 70 or
60, and you say I don't know,
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I can't do it.
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Call them back in a few days and
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jump your offer up
closer to that 50%.
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And that's sometimes
how you negotiate,
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which again we cover on other
videos and on the website.
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When you're dealing with Capital
One and you need something done
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on your credit report,
this is unique to them and
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something really should
be done about it.
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I haven't seen any
news about this and
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I haven't seen any kind of
regulatory updates to this.
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But Capital One, when you
settle, will sometimes, and
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sometimes not, still report
a balance owed to them.
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So let's say, for example,
you have a $5,000 account and
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you settle it for $2,500.
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It's all documented,
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you've got a letter on
Capital One's letterhead or
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the debt collector, and
it says, hey, you owed us 5 and
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we're agreeing to accept
2,500 as payment in full.
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And this debt is settled as long
as payment's made by such and
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such a date, you get it
in there by that date.
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Everything's good.
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Everybody agreed to this
whole thing, and yet
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they'll still report $2,500 due
of the portion that was unpaid
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on your credit report, and
it can be a bear to get off.
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And then I see them not do
that in other instances.
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So be careful of
your expectations on
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credit reporting.
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They are the only bank
that I see do this.
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Every single other one
follows through and
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reports a zero balance
owed once you've settled.
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So stay tuned for updates on
that, but I wanted to make sure
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that you were aware of that if
that was one of your goals was
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to negotiate and
get it to show a zero balance.
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Thanks for
tuning in about Capital One, and
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I'll look forward to
you on the next video.
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