Citibank settles credit card debt, and what you'll pay depends on whether the account is still with Citi or has been sold. Pre-charge-off offers with Citi typically land at 40 to 60 percent of the balance; post-sale offers to debt buyers like Midland Funding or Portfolio Recovery Associates often go lower. To start, call Citi at 1-800-950-5114 and ask for the hardship team.
Settlement percentages by account stage
Where your account sits in the delinquency timeline drives the offer Citi or its buyer will accept.
- 0 to 90 days past due — still with Citi. Hardship plans, not lump-sum settlements.
- 120 to 180 days past due — pre-charge-off. Lump-sum offers commonly resolve at 40 to 60 percent of the balance.
- After charge-off, still with Citi. Citi may accept 30 to 50 percent before selling.
- Sold to a debt buyer (Midland, Portfolio Recovery). Offers often clear at 30 to 50 percent, sometimes lower on older accounts.
These ranges are typical, not guaranteed. The CFPB's guidance on negotiating with debt collectors covers what applies once an account is sold.
Citi hardship program
Citi's hardship program is a short-term track for cardholders who can pay something but not the full minimum. It's most accessible when the account is current or briefly past due.
What it typically offers:
- Temporary APR reduction
- Lower minimum payment for 3 to 12 months
- Late-fee waivers
- A structured plan to bring the account current
Citi's debt-management page lists relief options. Call early — the program prevents charge-off, it doesn't undo one.
Pre-sale vs post-sale: the two-stage Citi dynamic
Citi is an active seller of charged-off credit card debt. After charge-off (around 180 days past due), Citi often sells the account to a debt buyer. The CFPB has taken action against the two largest debt buyers — Encore (parent of Midland Funding) and Portfolio Recovery Associates — for deceptive collection practices, so confirm who owns the account before you negotiate.
That creates two windows:
- Pre-sale (still with Citi). You're negotiating with the original creditor. Offers in the 40 to 60 percent range are common.
- Post-sale (with a buyer). The buyer paid a small fraction of face value, so a 30 to 50 percent offer can still be profitable. Confirm ownership in writing before sending money.
Step-by-step playbook
- Pull your most recent statement. Confirm the balance, account number, and current status.
- Identify who owns the debt. Collection letters must name the owner. If you're unsure, request debt validation in writing within 30 days of first contact.
- Decide what you can pay in a lump sum. Settlements close fastest when funds are ready.
- Call the right party. For Citi-held accounts, call 1-800-950-5114 and ask for hardship or settlement. For sold accounts, call the buyer named on the most recent letter.
- Make your offer. Start below your target — 25 to 30 percent is a reasonable opening on a charged-off or sold account.
- Get the agreement in writing before you pay. It should state the amount, the account number, and that the balance is satisfied once paid.
Tax implications
Forgiven debt over $600 is generally reported to the IRS on a Form 1099-C and may be taxable. Exceptions exist — including insolvency at the time of settlement — under IRS Publication 4681. If a 1099-C is likely, plan for it before you settle.