We have two credit card accounts with Citicard in default. One is for $14,500 and the other is for $18,500. We recently were served papers showing a court date of 3/1/09. Since it is now in the hands of a law firm, is it more difficult to arrive at a settlement under 50% since there are now attorney fees accruing? Also our personal home mortgage is with Citibank. Could this have any bearing on being able to settle?
I have seen no evidence to suggest that attorneys drive harder or softer agreements than collection agents. Open negotiations with the law firm and see what you learn. You will be in a much stronger position if you can scrape together a lump-sum settlement. Open negotiations at five cents on a dollar of the original balance, and work up from there. If you have to negotiate a payment plan you are in a much weaker position, because isn't it a payment plan that you defaulted on to get you into this position?
Regarding your mortgage, review your loan documents carefully to see if Citi reserves a right to pursue private collections actions on your debt.
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