How To Get Rid Of Collection Accounts On Credit Report?
Introduction This is very important because the account that you have with a collection agency will reduce your credit score greatly. These accounts mean you have unpaid bills which have been reported to the credit bureaus. Collection accounts have an even greater effect on your score the younger they are: Collection accounts have a greater detrimental effect on your score the younger they are. This way you will be able to get those negative items appearing on your credit report to be deleted and thus act as a way of boosting your credit status. The following are guidelines that will help an individual to challenge collection accounts and have them erased.
Send Debt Validation Letter The first act is to write to the collection agency demanding that it validates the amount through a process known as debt validation. Remember to write your name, current address, account number, and debt balance of the alleged debt, and request them to forward to you the court documents that justify why you are held responsible for the debt. The letter should state that they must verify the debt with you within the next 30 days or it cannot be on your credit report.
Pay off the debt Since the loan is expensive, one has to pay off the debt to be free from the high cost of borrowing. In case the agency provides you with proof that the debt is authentic within the given 30 days then it is advisable to pay off or perhaps negotiate for the account. It should be noted, however, that simply paying off a collection account does not necessarily mean that the account will be removed from the credit report. Nevertheless, you can convince the agency that for a fee they will delete it from the credit report which can positively affect your score. Always demand and get any pay for deleted settlement offer in writing before parting with any amount of cash.
Dispute The Account If the collection agency fails to reply to your request for validation of the debt or you make payment to them and they do not discharge as they had agreed in writing, then the account should be disputed. Disputes can be provided to the credit bureaux at any time, either 30 days after the initial letter was written to the creditor, the account has been paid or settled and should be sent in writing to all three credit bureaux namely Equifax, Experian, and TransUnion. State that this collection account is unverified, fully paid, completely incorrect, or not being reported correctly. Demand the credit bureaus investigate whether the account is yours and that they furnish you with documents to that effect.
Let me tell you a shocking fact, most collection agencies fail to reply to credit bureau disputes within the mandatory period. This leads to the accounts’ deletion per the laws of the Fair Credit Reporting Act as earlier noted. Collection accounts usually disappear more frequently when challenged than the other negative accounts such as the very late payments or other negative items because the collectors do not take the time to respond to the challenge. It is advisable to retain printed copies of any written communication that has led to a dispute with a contractor. Disputes can also be supported by documents that can be uploaded where one is making the claim.
Repeated Disputes For instance, if the collection is verified by the bureaus as accurate the first time, attempt multiple disputes. Regularly argue that you do not owe the amount being claimed in the particular collection account insisting that it is still unsettled. New dispute letters should be sent after a 30-45 days interval should be used. The chances that agencies are going to fail to adequately or punctually respond and validate the claims next time or several times more are high as the probability of getting unwanted collections removed also increases with every new dispute.
Legal Demand Letter Failing the above steps, you should have a legal demand letter from an attorney to the collection agency. The letter outlines that legal proceedings will be initiated if the invalid, paid, or inaccurate collection account has not been dumped from the credit report within a stated time. Collectors do not want the legal issues. This can lead them to decide to delete the account that they had been maintaining for a long time. The attorney letters generally have more success but they are not free. Therefore, subject to the circumstances, always try non-adversarial ways of challenging items first.
Conclusion When you have collections pulling your credit score low, it is quite frustrating. However, it pays to remain consistent in sending debt validation and dispute letters as this is effective in having many of these negative entries removed. This makes your score to be able to regain lost ground because those derogatory marks are no more. If feasible, encourage the collector to sign a document acknowledging to deletion of paid collections. It will take roughly about three months for the results to start manifesting in terms of the vain attempts to eliminate undesirable collections from the credit report.
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