Having a collection account indexed on your credit report has the effect of reducing your FICO score significantly. At aaacreditguide.com we provide ways through which you can get rid of collections from your report and consequently increase your credit rating:
- REQUEST THE COLLECTING AGENCY TO VALIDATE YOUR DEBT
Now the main objective of the CFPB (Consumer Financial Protection Bureau) is to regulate collecting agencies. The law also compels it to validate the debt of a customer, in this case, you, upon request. If the agency does not comply, it is subject to heavy fines so be assured that your request will be implemented within 30 days, failure to which you can initiate a complaint.
- REFUTE THE ACCOUNT WITH THE BUREAU EVEN IF IT’S AUTHENTIC
The bureau is deemed to carry out an investigation on anything you refute unless they consider it to be impractical. The basis of your claim could be that the records are inaccurate. There are even some cases whereby the customer stated that the records weren’t his. Whatever the case, get creative with your complaint. Your complaint will lead to the rise of a new investigation by the bureau and it will take up to 30 days to verify the accuracy of your records. It is in the course of the investigation that the account details will be deleted from your report and even if it turns out that indeed the records were correct, you will still be on the winning end as your sole aim was to have the collection account deleted.
- SET UP A ‘PAYMENT FOR DELETE’
If the first 2 steps don’t work and you are unable to get the collections deleted, the next reasonable step would be to negotiate a payment in exchange for delete. This basically means that for clearing your balance, the collection company will remove the collection account from your credit report. The only downside to this is that the rate at which you pay off your debts will determine how fast the collection account will be removed from your reports.
- SETTLE YOUR DEBT AND REFUTE IT AGAIN
Paying off your balance does not increase your credit rating and definitely won’t get your collection account removed. However, you will now be able to approach the bureau and dispute the credit items again. As the creditor does not have the incentive to validate whether all other debts have actually been paid, it will be faster to get the collection deleted from your report by the time investigation is completed. It will appear as if you never had collections in the first place.
- WAIT FOR YOUR DEBT TO BE SOLD TO ANOTHER COLLECTION AGENCY AND THEN CHALLENGE IT
The amazing thing about debt is that it is constantly being sold to various collection agencies. When one agency is unable to get the payment of a particular debt, it may choose to sell that debt to another agency. At this point, the creditors listed on your credit report will lack access to your account information and so you might get lucky and have it deleted. The downside to this strategy is that you may have to wait quite a long while before your collection agency decides to sell your debt to another.
Getting a collection account on your credit report shouldn’t be a source of panic. The above steps go a long way in enabling you to get rid of the collection. Even if you’re completely unsuccessful in removing the collections, you should keep in mind that the older the information on your account gets, the less impact it has on your FICO score.