Most folks do not have any idea what to do about charge-offs when they show up on their credit report. A charge-off is an indication that the initial creditor has written the loan off as a loss, therefore they are no longer actively attempting to collect on the loan. However, it still shows on your credit report and it is not a shock that most people do not know what to do about a charge-off. Should they pay off their debt or should they leave it alone?
A lender will write off the loan as a loss if they are unable to collect within a certain amount of time. It is more constructive for them to write it off as a loss if they do not think that they will ever be able to collect it. Many times they do refer it to a collection agency however, and this can sometimes lead to duplicate listings on your credit report because the initial lender and the collection agency are both reporting to the credit bureaus even though there is just one account.
A derogatory credit listing, such as a charge-off is expected to stay on your credit report for a period of 7 years, however that is 7 years from the date of the last movement on the account. So if you pay off an old charge-off to eliminate it from your credit report, it only serves to bring the poor credit forward as the 7-year time period starts again. So it may be more unfavorable to you to pay if off than it is to leave it alone since the bad credit will be brought forward. This is specially true when you have good new credit that you have been working on.
No matter what the state of affairs may be, before you ever pay off any form of older debt, such as a charge-off or a collection account you need to make sure that you get an agreement in writing that once the debt is paid off they will erase it from your credit report. This process is called a "Pay for Delete" and it is really the only way to protect yourself from further derogatory credit being reported on your credit report about that account.
In spite of of the conditions, the Fair Credit Reporting Act or the FCRA has given you the right at a consumer to dispute information found on your credit report. You can dispute everything that shows as poor credit like charge-offs, collection accounts, tax liens, judgments, repossessions, bankruptcies or foreclosures. You will necessitate to write a letter of dispute, the credit bureaus then have a evident amount of time to confirm their information or it must be removed.
As you are writing dispute letters and corresponding with the credit bureaus it is imperative that you keep scrupulous records. Keep a duplicate of all correspondence from you and to you. Also make sure to keep track of the dates. The credit bureaus will have 30 to 45 days from receipt (send it certified mail so you know the exact date) to confirm their information and then an added 5 days to answer back to you. Make sure you follow up with them in a timely manner. Also you may need to be unrelenting and try again if you are not successful at the start.
You may do all of the work to repair your credit on your own, then again, it can be time-consuming and perplexing and you may decide that it is more cost-effective based upon the time involved and the knowledge required to employ a specialist. A professional credit repair business has the knowledge and experience to help you through this perplexing procedure and while it is not compulsory you may consider that your time is better spent on your own job and your own life and delegating to someone else is a benefit for you.
It is completely feasible to get any type of negative credit listings deleted from your credit report, including charge-offs, collection accounts and even bankruptcies and foreclosures. There are some straightforward and specific steps to take to get started. At the same time you will also need to start rebuilding good credit as you go so that it can prevail over the poor credit of the past. - 2364
A lender will write off the loan as a loss if they are unable to collect within a certain amount of time. It is more constructive for them to write it off as a loss if they do not think that they will ever be able to collect it. Many times they do refer it to a collection agency however, and this can sometimes lead to duplicate listings on your credit report because the initial lender and the collection agency are both reporting to the credit bureaus even though there is just one account.
A derogatory credit listing, such as a charge-off is expected to stay on your credit report for a period of 7 years, however that is 7 years from the date of the last movement on the account. So if you pay off an old charge-off to eliminate it from your credit report, it only serves to bring the poor credit forward as the 7-year time period starts again. So it may be more unfavorable to you to pay if off than it is to leave it alone since the bad credit will be brought forward. This is specially true when you have good new credit that you have been working on.
No matter what the state of affairs may be, before you ever pay off any form of older debt, such as a charge-off or a collection account you need to make sure that you get an agreement in writing that once the debt is paid off they will erase it from your credit report. This process is called a "Pay for Delete" and it is really the only way to protect yourself from further derogatory credit being reported on your credit report about that account.
In spite of of the conditions, the Fair Credit Reporting Act or the FCRA has given you the right at a consumer to dispute information found on your credit report. You can dispute everything that shows as poor credit like charge-offs, collection accounts, tax liens, judgments, repossessions, bankruptcies or foreclosures. You will necessitate to write a letter of dispute, the credit bureaus then have a evident amount of time to confirm their information or it must be removed.
As you are writing dispute letters and corresponding with the credit bureaus it is imperative that you keep scrupulous records. Keep a duplicate of all correspondence from you and to you. Also make sure to keep track of the dates. The credit bureaus will have 30 to 45 days from receipt (send it certified mail so you know the exact date) to confirm their information and then an added 5 days to answer back to you. Make sure you follow up with them in a timely manner. Also you may need to be unrelenting and try again if you are not successful at the start.
You may do all of the work to repair your credit on your own, then again, it can be time-consuming and perplexing and you may decide that it is more cost-effective based upon the time involved and the knowledge required to employ a specialist. A professional credit repair business has the knowledge and experience to help you through this perplexing procedure and while it is not compulsory you may consider that your time is better spent on your own job and your own life and delegating to someone else is a benefit for you.
It is completely feasible to get any type of negative credit listings deleted from your credit report, including charge-offs, collection accounts and even bankruptcies and foreclosures. There are some straightforward and specific steps to take to get started. At the same time you will also need to start rebuilding good credit as you go so that it can prevail over the poor credit of the past. - 2364
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