I've been trying to get my credit back on track since 2007. However, I had a cc with Capital One which I was drowing in. My limit was $1000 and my balance on it was $800 at the time I tried to start paying it, but I was just not making enough to put a dent in it. One late payment turned into a ton of money in late fees and interest and it just kept accumulating, but I had no choice but to keep paying what I could even though my balance was increasing. In 2009/2010, it was sent off to in-house collections, I believe, due to late payments. I tried working with them and had started getting monthly payments arranged, which would catch me up and put me back with the original creditor and put me in good standing, but one month there was some computer error that caused my payment to not be made. It was not a fault on anyone's end. My payments were scheduled months in advance, but for some reason, during one month, it did not recognize my account. I didn't realize this until about a week later and when I called I was told it was sent back to collections and there was nothing that could be done now. I fought with them on this since it was not my fault. I even sent a letter to them from the bank stating it had nothing to do with insufficient funds, as that is what they thought at Capital One, but to no avail, back to collections it went and they wanted a huge amount. I could not do it, so I didn't pay it and just paid other debts.
Now here we are in 2013 and I still haven't paid it, but it is causing havoc on me trying to get a personal loan. I make the money now. I've paid off huge debts but of course they still show as closed or negative. I did receive a lot of letters from Capital One and their collectors stating if I paid now they would decrease it by so much (it is at about $2500 right now), but the letters and calls stopped about a year ago. I just don't have that lump some. The last activity on it was back in 2011. On my report though, it does not show as a charge off. All it shows is that it is behind $411 and monthly payments are $114 and that it has been late over 150 days late. There is nothing saying it was passed on to a collections agency or charged off yet.
My question here is, what should I do for the best outcome. We are in the process of moving, and I was trying to get a small personal loan for moving expenses, but they won't do it due to deliquencies. I do have some from a few years back, but Capital One is my most current one. I can't do anything about previous delinquencies or negative accounts, as they are already closed and paid in full accounts, so they are pretty much there for a few more years. I can, however, try and do somethign with Capital One, but what is the question. I don't want to take a chance of letting it reach SOL (4 years in Texas), as Capital One is a huge company and could easily sue. I don't want to restart the SOL either. I don't have the lump sum to offer them. I have heard of paying to delete but that is is against the law. What options do I have? How can I clean this up? Any ideas or advice? My credit score ranges from 645-685, so I don't know if taking care of this would hurt or help me either. I worked hard to get it where it is at and would hate to mess it up.