In the event you don’t pay your debt within a certain time frame the financial institution will charge off the debt. The timeframe varies but it’s usually when the debt is from about 5-6 months without payment. If you have a charge-off showing on your credit report it is dramatically reducing your credit rating and you may not know the easiest method to handle it. Do you pay if off or not?
When a lender charges the debt off they are essentially losing profits and they no longer try to collect the debt. However, they don’t usually just give up but rather refer it to a collection agency instead, who then tries to collect it. Whenever a debt is referred to a collection agency the consumer needs to make certain that the debt is not being reported on the credit report more than once. Sometimes both the original lender and the collection agency are reporting the debt and it should only be reported one time.
Negative credit will stay on your report for a time of 7 years from the date of the first delinquency. Any unpaid charge-off will likely be required to stay on your credit report for the full 7 years but it is possible that you could get a charge-off removed if you negotiate with the lender and repay it. Before paying it off though you need to consider how much longer it needs to remain on your report.
Before you pay off the old charge-off make sure that your lender agrees in writing to remove the item from your credit file. This credit repair technique is known as “pay for delete” which is a very effective credit repair solution if you’re able to have great results. It is probably to your advantage to either pay off the debt completely or not at all because partial payments will not serve you.
For those who have a charge-off on your report that isn’t completely accurate or true you can dispute it and get it removed. The Fair Credit Reporting Act has given consumers the right to dispute erroneous information so that their credit report is a true and accurate reflection of their credit history. Any kind of negative listing can be disputed.
It is possible to issue credit disputes on your own and some people have been successful at that. However, you might want to consider enlisting the aid of a professional to take advantage of their expertise and experience. There are some advantages if you select a good, reliable and experienced credit repair agency but if you’re so inclined it can be done yourself.
Once the credit agencies receive the dispute there is a 30-day window in which to verify the truthfulness of what they are reporting. If it cannot be verified then it must be deleted from your credit report. As a result of that you should dispute erroneous information until your report is completely accurate and truthful and your credit history is as positive as possible.
A lot of us struggle with credit problems at different times in their lives. Luckily there are steps that a consumer can take to improve or repair their credit. Get in touch with an experienced and professional credit repair company today.