How to Write Off on Regions Bank Loans

A loan written off by Regions Bank could cause your credit score to drop significantly. You also may face collection efforts, as the bank assigns your loan account to an internal or external collections team. Although the credit consequences can be severe, some people intentionally allow accounts to be written off in hopes of paying them off for less than the full amount owed -- a process called debt settlement. It's important to note that it's up to Regions Bank to write off the account -- not you. You will remain fully liable for the account even after Regions takes the write-off for tax purposes. Also, only unsecured loans, such as credit cards and signature loans, are eligible for settlement.

Instructions

1

Contact Regions Bank to make sure you fully understand your options. Call the customer service number on your statement. If a settlement offer is what you really want, ask for that. Most banks will offer to settle your account once you fall three months behind on payments, the SmartMoney website reports, although Regions could elect to settle sooner if it suspects you will default.

2

Offer to settle your loan account with Regions for 20 percent of the balance. Banks will generally settle for 20 percent to 75 percent of the balance, according to SmartMoney. Politely end the conversation and hang up if Regions won't settle or settle for an amount that you cannot afford.

3

Call back every few weeks to ask again. Most banks will close your account and write it off after you fall six months behind on payments, according to MSN Money. Writing off the account will allow Regions to collect a tax break equal to 35 percent of your balance -- while still coming after you for the full amount.