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Charter asks ex-customers to resubscribe or risk their credit scores

Charter asks ex-customers to resubscribe or risk their credit scores


A letter confirmed as legit by the company offered debt forgiveness — at a price

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Illustration by Alex Castro / The Verge

Charter has been telling former customers that it’ll forgive their debts and stop reporting them to credit agencies if they resubscribe to the company’s Spectrum TV, internet, or voice service, according to a story from the Los Angeles Times. The “one-time courtesy” offer came to light after Steve Schklair, who says he hasn’t been a Spectrum customer for years and doesn’t owe the company money, shared a letter describing the supposed deal with the LA Times. Charter later confirmed the letter was authentic, saying that it was an offer that was meant to help consumers “reconnect” to Spectrum, as well as get a leg up on their finances.

According to the LA Times, the letter Charter sent Schklair said the company would cancel his (supposed) debts after he resubscribed and that his new account would be in good standing. It seemingly implied that Charter had been reporting that debt to credit reporting agencies (potentially bringing down Schklair’s credit score) and that he would no longer have to worry about that if he was a customer again.

Reporting debts is Charter’s legal right — but Schklair says the offer still feels like blackmail

The letter tries to paint it as a charitable offer from the ISP, saying that a good credit history helps you get credit cards and better mortgage rates. While the company has a history of sending customers an annoying amount of letters, the Times hilariously points out that this one comes off as “Sopranos-like,” almost as if the company is saying, “You’ve made a nice life for yourself. Be a shame if something happened to it.”

Charter has a legal right to report an ex-customer’s debts to credit report agencies if they still owe money — that’s how the credit reporting system works, for better or worse. But if the letter was offering no-strings-attached debt forgiveness, or even a reasonable debt repayment plan, it probably wouldn’t be described as “sleazy” and “corporate blackmail,” “filled with real and implied threats” by some of the people receiving it. It’s hard to come off as altruistic if you’re not telling people about the better options they have and just trying to get them to give you their money again.

Spectrum customer service reps couldn’t find outstanding payments for Schklair’s account

Making the situation feel even grosser, Charter may have sent the debt forgiveness offer to Schklair for no reason — he told the LA Times that Charter hasn’t been dinging his credit reports, the company hadn’t been contacting him about missed payments, and that two customer service reps said he didn’t owe anything (Charter said it wouldn’t discuss Schklair’s individual case for privacy reasons). In a statement to The Verge, Charter said the letter was a “highly targeted promotional offer for former customers who have an outstanding past-due balance of at least two years, and are currently in the collections process” and that the offer made it so customers would be able to escape collections without paying that balance.

Disclosure: Comcast, a competitor to Charter, is an investor in Vox Media, The Verge’s parent company.

I’m not a financial advisor, but I’ve heard most of the experts say that you should be wary of offers from companies saying you can consume your way to financial freedom. The offer in the letter reported by the LA Times goes from $50 to $75 after a year — a big jump that someone who struggled with payments in the past may have a hard time dealing with (unless they’re counting on Spectrum to lock them into a cycle of debt forgiveness offers). While trying to woo customers back is standard corporate stuff, maybe Charter should consider either going back to the standard “we miss you” letters or making actually helpful offers to customers rather than a way to trap them back in the same debt cycle (provided, of course, that the customer was even in debt in the first place).