Discover How To Get Rid Of Charge-offs On Your Credit Report Today!
There is a great deal of confusion among consumers about how to handle charge offs on a credit report. It is well known that charge-offs are considered to be negative credit but what is the best way to handle it? Should I pay off this bad debt? Should I not pay off this bad debt?
Well the answer may surprise you as for both questions is ?yes?!
The term ?charge-off? just refers to a debt that the lender was unable to collect. Often they will give up trying to collect and give the bad debt to a collection agency. Many times this makes it worse for the consumer as both the original lender and the collection agency can report the bad credit. This will make 2 negative marks on the credit for just one account.
An old charge-off will stay on your credit report for as long as 7 years. It is possible to get an old charge-off deleted from your credit report but a ?paid charge off? is easier to remove than an ?unpaid charge-off?. However an unpaid charge-off will drop off your report after 7 years but if you pay off the bad debt it will bring it current again and begin the 7-year cycle all over again and the bad debt will stay on your credit for another 7 years beginning from the time you paid it off. It is a catch-22 situation. You have problems either way.
So what is the best way to handle paying off a charge-off? Well before you pay off the old debt make sure that you get a statement in writing from both the original debt owner and all of the collection agencies that says that once the debt is paid they will delete it from your credit report immediately. This technique is called a ?pay for delete? and it is the best way to pay off an old charge-off.
Many people are not aware that they have the right to dispute items shown on their credit report. The Fair Credit Reporting Act states that any consumer can dispute any bad debt on his or her credit report and this means charge-offs, collection accounts, tax liens, judgments, repossessions and even bankruptcies and foreclosures. You can dispute these things and get them deleted yourself or you can hire a professional credit repair agency to help you.
You can dispute items on your credit report by approaching the consumer reporting agencies that are reporting the bad credit. You can call them, write them or even contact them online, however, the best way is to compose a formal letter so that you have proof. Make sure that each agency gets the same letter and make sure you keep copies with everything documented. They will have 30 days to investigate so make sure that you keep track of the dates.
The credit agencies are supposed to follow up with the original lenders and any collection agencies. They are also required to look at the public records on your accounts. Make sure that you follow up with them after the 30 days is up to make sure that they are working with you. Credit repair can take some time but it is sure to take even longer if you are not following up with your own requests.
While it is possible to repair your credit by yourself a professional credit repair company has developed the knowledge and expertise to simplify the process. Since a professional can do it quicker and easier it may be worth your time to consult with them first to see if they can help you.
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