Hello--I have an opportunity to settle w/BOA on a $6200 account for 50%. Second option is that BOA will approve me into a 0% apr program. The account is/has been -90 day cycle for the past year or so.
I have a few other misc debts w/collection agencies (4 other accounts ~$600-$1000), and have a fairly bad credit score (high 500's-very low 600 range). The negative remarks on my report have been there since 2003/2004.
I want to clean up my credit as much as possible now, so which would be the best option regarding a negative impact on my credit score:
1) settle for 50% and then eventually start to settle w/the CA's. This option would eliminate my debt in the next year or so, but then I will have "settled" remarks on my report. If I settle, I actually will be doing a balance transfer from my wife's credit card in her name (@ 4.99% until transfer is paid off), and then pay her account ~$250/month until it's paid entirely. I do have some other accounts in my name that are +, so I will still be building credit in other areas.
2) accept the 0% rate, and get in a program where they will take $230/month going forward. This will able me to get the account reported as paid in full from the original creditor, however I've noticed that when my other credit accounts were negative for any length of time and then I proceeded to pay in full, they still are reflected under the negative column on my credit report, as they report the account is paid but was ___ days behind. Also with this option, I won't be able to have all the misc collection accounts settled for some time either, so they will remain open on my report.
Which choice would you take (1 or 2), and does anyone know how much impact a settled account has on your credit report? Thanks in advance!