How to Settle Credit Card Debt with Discover


[MUSIC] Hi there, I’m Michael Bovee with
Consumer Recovery Network and welcome to our YouTube channel. Today it’s been brought
to my attention anyway, that I should discuss
more creditors specifics. I talk a lot of generalities, debt settlement in general,
debt consolidation in general, dealing with debt buyers and
credit reports. But let’s narrow down our
focus to specific entities. And I want to start with
Discover Bank and dealing with them when you can’t afford
your credit card payments, because they’re pretty unique. In fact, currently, at
the time we’re recording this, they’re probably the most unique
in how they deal with you, their customer when you’re
unable to keep current. First of all, it’s pretty
standard for all banks to offer some form of hardship plan or
reduced interest rate plan through a non-profit
credit counseling agency. If you’re struggling with more
than just Discover, I would highly recommend that you call
the hotline and press one. And get connected to the largest
national non-profit credit counseling agency. And find out how you can you can
consolidate more than just one bill and
get your payments lowered. Or at least potentially find out
what they can be lowered to. It’s a free call, so it’s worth the effort
to get an exact quote. But if you’re just dealing with
Discover and you want to get in touch with them about, hey I
can’t pay this month’s bill or I wasn’t able to pay two
weeks ago when it was due. If you’re not quite, or too far along in delinquency,
calling them can yield a result. And the result could be
exactly what you need. In other words, let’s say your minimum payment
to Discover due is 400. You didn’t pay it two weeks ago,
you’re already late. Calling them and discussing your
options to lower your monthly payment could yield
something like this. Let’s say your interest
rate’s 18% and they’re willing to
drop it down to 0.9%. Yeah, they do it, right? It’s specific, you can’t say
that they do it with everybody. You might qualify for it though. And having that discussion with them is a worthwhile
thing to do. Let’s say that you can’t
amortize your repayment, your balance to
Discover is 10,000. Amortize that over sixty months
and that’s still too much for you and you can’t afford it. Discover does some things very
unique than any other credit card issuer currently. They offer what’s
known as a 60/60 plan. You have to qualify for it,
it’s not for everybody. They’re not going to extend
that offer to everybody. You have to be actually months
sometimes behind with payments before they can qualify you for
it. So obviously this starts with
a phone call to Discover. Can’t do, can’t qualify for a full repayment of your
debt over 60 months or a temporary hardship plan,
it’s still too high for you. What if you took your balance,
your $10,000 balance and suddenly now it was
reduced to 6,000. So only 60% of what you owe and then you amortize
that over 60 months. Now your payment’s even lower
than it was amortized over a $10,000 balance for 60 months. You’ve reduced it
close to half or 60%. So they call it the 60/60 plan. A bunch of creditors
tried to test this out, didn’t really last long. And Discover’s the only one
that really stuck with it, or at least publicly
that I know of. So there’s another option. Now after that, if you’ve
fallen behind with Discover to the point where they’re
charging your account off. You haven’t paid in six,
seven months, they’re gonna subject your account to many
different types of collection. They are one of the more
litigious banks in the nation. So while I favor them in how
they work with their customers early on in your delinquency,
they’re one of the more aggressive ones after
you pass a certain point. And that point is typically
around the seventh month that you
haven’t paid them. Your risk of being assigned
to a collection attorney, somebody who specializes
in your state and collecting through your courts. That’s an escalation that
sometimes leads people to having to file bankruptcy, or
having to focus their attention on dealing with Discover and
settling with them early. Because getting sued and having
the risk of your wages exposed or your bank account levied,
even property liens. It’s something you want
to prevent when you can. And you can, actually you can negotiate with
Discover directly before they ever place that account with
a collection attorney or a normal contingency debt
collector, the most common type. Who just calls you and
writes you letters to try and get you to pay. And if can’t over
a certain number of months, Discover will just
yank it back and send it out to another
collector or to the attorney. Prior to any of that,
around month six of nonpayment, you can reach out to
Discover directly. And discuss with them what you
might be able to do in offer of a settlement in full, but
for less than what you owe. My data,
what I keep track of and what the consumers that I work
with or talk with or interact with on our other YouTube
videos or on our website. I do have a dedicated
page up on the CRN site dedicated to just Discover and
settling with that. That data suggests that
your targets are usually gonna bottom out at 40% of what
you owe as a settlement target. There are times where they’re
going to want more and you may be one of
those profiles. Some of the reasons that
a bank might want to try and collect more from you
in a settlement for less than what you owe,
than say someone else. Is it’s consistent across all
debt collectors really in banks is, is that you might just
look more collectible to them. You look like somebody who
can afford to pay more. So they have actually
a kind of scoring model, they’ll draw a line at
a certain percentage for you, your neighbor might get better. So if you’re prepared to go as
high as 50% in negotiating with Discover, that’s a very
realistic target for a lot of folks out there. So keep that in mind, when
you’re reaching out to them, all of these things that I’ve
discussed with you are something that you can directly
discuss with Discover. And by the way you
can directly discuss how to resolve that with one of
the debt collection agencies or attorneys working with Discover
to try and get money from you. So you are empowered to
do a lot of things and work within your means. But never, and this is
the last thing I’ll end with. Never agree to do something to
resolve a debt with Discover that you are not confident 100%
that you can follow through on. Because you are wasting money
towards either some repayment plan long term or even a monthly
payment towards a settlement a couple months worth. If you can’t confidently
commit to it, don’t do it, wait until you can commit to it. And then put yourself in
a good position to resolve and put the Discover
account behind you. I look forward to seeing you
on some of our other videos. But you’re more than welcome
to comment below if you have questions or concerns about
your Discover account. [MUSIC]

34 comments on “How to Settle Credit Card Debt with Discover”

  1. Willa Hanna says:

    Hi Michael, your comments in this video are absolutely correct!

  2. Scott Wilder says:

    We called Discover as soon as we realized we wouldn't be able to make the next payment. "We can't do anything as long as you account shows current."

    They called us a week after we were late with essentially the same line with the threat that if we don't pay that we'll incur late fees and higher interest rates.

  3. heavymechanic2 says:

    What if Discover does not have a loan contract and was unable to sue me in court? The lawyer harassed me over the phone as an attempt to get me to agree to the debt. A collection agency admits in writing the debt is noncollectable. Discover continues to report to a CRA there is a contractual obligation without any valid documentation.

  4. Marquis C says:

    I recently fell behind on my payments, 18 days behind and I know I won't be seeing stable income anytime soon. I attempted to call to figure out my options they continuously told me that settling is not an option on my account. What can I do?

  5. Cory Cool Dangerous says:

    I love how your logo isn't REALLY on the computer screen behind you. haha

  6. Kassidy Boyle says:

    Is it possible to negotiate your interest rate while you're still current?

  7. Rachel Costello says:

    Currently trying to DIY settle with Discover and after chasing various departments over there for five days finally found someone who could help. The sent my account to Zwicker & Associates Pre Charge Off 120 days past due. They pulled every tactic you outlined, i.e. set-up a payment plan now before it goes to lawsuit, we have to propose a settlement to Discover and they only allow us to present 70% at this time but make a large down payment since if you want to settle you have some money and you can settle later. My question for you is – what do I do next? Do I wait 1 month, 2 months etc. What are the chances they will send it to a law suit which I want to avoid all together. Appreciate your help.

  8. Tara Clark says:

    My 80 year old mother is in poor health and heading for assisted living soon. During this time, my brother and I got power of attorney and learned that she is 35K+ in debt over 5 key cards, Discover being the largest. Should we try to settle with Discover (and 2 Chase accounts); or let them all be write off's if/when she passes? She has not been past due; paying hte minimums which suggest that it will take her 19 years to pay off – well beyond her time on earth. Thoughts?

  9. Daniel Gorgone says:

    Michael, I have a friend who I recommended to call you. He has debt with 5 cards, 4 of them all Chase-branded, and 1 with Discover. The total amount he owes is approximately $34k. All of them have now been charged-off, as he tried to work with a credit help agency (Freedom) that didn't do what he thought they would, and has cancelled his program and recovered his funds paid (around 3k). I'd like to help him, but I think he really need to consolidate and try to pay off these cards together, not just Discover, though maybe you have other advice. Can your agency help with that? Please call me, I'll leave my number on a voice message to you, and I can either be the point person (as he is Russian, speaks well but heavy accent, lol) or can put him in touch with you.

  10. Susan Devoy says:

    Do you do one on one consultation?

  11. Nukkta says:

    Quick Question: I am working with Discover on a settlement. I told them I could sent my settlement offer amount "TODAY", but via bank check. They said that they only take settlements via online payments. how safe would it be to pay them that way? Could they try to withdrawal more than the agreed upon amount? Would it be legal if they did? Of course I don't have much more than what I offered to begin with, and this would be AFTER I have gotten the agreement with terms from them in writing. Thanks!

  12. Nanaleigh says:

    Good day Michael, A week ago I received a summons stating that I am being sued by Discover Card. Did I understand you correctly in stating that the lawyers will negotiate a deal with me for less then I owe? I never had this happen before and I thought if it has gone this far that they would take it all the way. How should I go about to try to settle with the attorney for Discover? I haven't a clue as to what to say. Thank you

  13. boom1111111111111111 says:

    Hi Michael. Thank you very much for your work.

    1. When is the best month to go on the Discover ($15000) hardship plan? Anytime up until month 6 of delinquency, or is it better to target month 3 or 4, for instance?
    2. If I ultimately want to settle with Discover, but only do so 12 months from now, and want to pay the minimum until then but not get sued, can I A) go on hardship plan after 4-6 months, pay it for 3 months, stop paying, then negotiate a settlement for say, 50-60% of the balance in month 11 or 12 (i.e. after 3 months of not paying hardship plan)? Or should the hardship plan never be abrogated lest litigation ensue?

  14. Harkwit says:

    Hi Michael,

    I just enrolled with a debt settlement company, and one of my accounts is about &1,800 through Discover. Am I at high risk for potential lawsuits at this balance before a settlement could be reached?

  15. kawdenco says:

    I have a friend with about 10K outstanding to Discover…going through divorce and had issues come up with non paying customer in his business. Unable to keep his credit current. Do you have a number i could call at discover to help him negotiate a settlement? also has outstanding balances at Citi and Capital One adding up to $21K.

  16. James Wilson says:

    I want to avail your settlement services. Please let me know, how can I reach out to you .

  17. James Wilson says:

    Does Discover sues too often  like capital one ? or Is it easier to settle than capital one ?

  18. george price says:

    Hi. I have a debt of  5500$  towards discover credit card  . Is it still difficult to settle with Discover , provided that I am okay to settle it at 40% ?  Does it still sues a lot? Kindly advise.

  19. laura carter says:

    Hello Michael. I took the balance transfer from disover after 1 year of opening the account. I took 5000$ at 0% APR 10 months back.And paid 10 monthly payments thereafter . Currently this credit card account is 2 years old and i am running 2 months behind. What settlement % can i look for ? Do you foresee any issue in settlement in my case?

  20. melvonnar1 says:

    my advice=====close all bank accounts; close all credit cards, change address turn off telephone; NEXT SET BACK AND TELL THEM TO GO TO HL AND TRY TO COLLECT I'M 86 —————GARNASH MY WAGES LOL,  I OWN NOTHING, LOTS OF LUCK YOU THIEVES.

  21. melvonnar1 says:

    discover card added $1700.00 to my card two months after I closed it when I closed it there was a 0 balance I now refuse to pay these added charges that were added to my closed card. they can kiss me where the shon don't shine.

  22. Justin Z says:

    Does this work with discover personal loans too? Or How is it different from the credit cards?

  23. Justin Z says:

    I got a 19,000 personal loan with Discover that I'm worried about. They said there's no offer on the table, but strongly hinted to call back at the end of the month for an 8-9000 settlement. The guy I talked to stated that "Discover hasn't settled any loans over the last 2 months." Can you verify this? All they want to do is extend the 4 year loan over 9 years to lower the payment.

  24. Dave Reynolds says:

    For a variety of reasons, my Discover bill got away from me. A large part of it is that I was out of work twice in 2018 (for 3 mos. and 2 mos, respectively). Another part is that my sister (unmarried) had major surgery, and then there is my son (who has special needs). Before the last couple of years, my credit was fine. But now it is low – for the first time in my life.

    I'm working again and trying to catch up. I was behind on some other bills – notably, my mortgage – but am close to catching up on them. The "casualty" had to be Discover, because it was about $28K. It is not a little over $30K, and is in month 6. I am now getting daily calls, which I have not yet answered.

    I am 65, so won't be able to work forever – although I do play to work until 70. I'd like to get a reduction and pay it off, but I see they no longer offer the 60-60 deal. I do NOT have the cash/assets to pay off a one-time settlement. I have watched your videos, but would appreciate any advice about what you think my best option would be.

    Thanks for putting these videos out, and for any advice you can share.

  25. Gee Frazier says:

    How can I settle with discover and have it removed off my credit report?

  26. Ryan Bailey says:

    I was issued a summons by a collection attorney representing Discover Bank for an outstanding balance of $4,100 at around seven and a half months after making my last payment. I had multiple dialogues with Discover over that duration about not having gainful employment as a result of a persistent medical condition and was actually discussing a settlement offer with Discover the day before being served (which I determined was no longer achievable directly with Discover after receiving the summons). I was surprised by how rapidly it escalated with Discover, after receiving favorable settlement outcomes with AMEX, Capital One, and BOA. I did respond to the summons and have received a court date in late October (the District Courts in my home state are back logged and there's a dire shortage of judges). Should I try to contact the collection attorney between now and that time to determine if a settlement might still be attainable?

  27. SevenSeas 144 says:

    You don’t say anything about them providing any proof of contract?

  28. shane bond says:

    Hi Michael. I owe 6000$ to Discover and currently i am 3 months behind. The amount doesn't includes any balance transfer. After using my card for 6000$, i paid the minimum amount for 4 months and stopped paying thereafter. I opened this account with discover around 2 years back. Please answer my questions :-
    1) Is discover account difficult to settle, as compared to other credit card providers ? Yes/No
    2) Does discover sues too often as compared other credit card providers? Yes/No
    3) At what percentage ,can i expect to settle this account ? Can i do this at 40% or 50%?
    4) Do you foresee any complications in settlement in my case?

  29. Carol Lashley says:

    how do I get specific information from Michael Bovee  on how to undo what I may have said to Discover card trying to lower my payment

  30. Manish Kumar says:

    Hi Michael. I have one credit card account with American Express and other credit card account with Discover. I am 4 months behind on both .

    Is Discover difficult to settle ,as compare to American express?

    Does Discover sues more than American express?

    I understand , that the situations vary from person to person . But based on your experience, just need your general opinion. Thank you so much !

  31. Danny H says:

    Hi Michael —– regarding a Discover account that is due to be charged off in about 2-3 days, a 60% settlement offer was extended. Had the offer been, for example, around 40% instead, then I think there would have been an easy decision as a result. However, at 60%, it seems to me like there is not much downside if the charge-off does in fact take place? Or would there be significant fees added to the balance immediately after charge-off?

  32. Sonya Peria says:

    How far behind in payments do I need to be before I start to negotiate with discover?

  33. mm64 says:

    Hi Michael I'm 140 late days with discover and they still wont settle less than 60% .. last time they offered me 50% but they wont do it now

  34. Harold Suarez says:

    Discover sent my account to an attorney, do you know if they can bring the account back so I can pay discover directly?

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