How to Delete a Collection Account |
By Kenneth Long on April 2, 2010
.jpg.aspx?width=75&height=75) Collection accounts penalize you for 7 years. They can deny you credit and keep you from buying your first home.
There are a couple of ways in which you can get collection records permanently removed from your credit report, and neither requires contracting with credit repair companies.
Dispute with Credit Bureaus
You may dispute the record with credit bureaus. This is an obvious step if the record is invalid.
Sometimes you can get lucky by successfully removing a valid collection account. Credit bureaus must remove disputed items if the creditor fails to respond to an investigation. If the creditor has gone out of business or is otherwise too busy to respond, then it can be removed. This is fairly unlikely, but it can be worth a shot on certain accounts.
You must of course be careful about trying this step if your debt is still collectible. Such an act could trigger new collection efforts, especially on an account which is still within the statute of limitations.
Pay for Deletion Agreement
Many debtors miss out on a negotiation technique that many debt collectors will respond to. It is true that many debtors have successfully settled debts for less than the balance owed. Of course, debt settlement is more successful when you negotiate your own settlement rather than contracting with pricey and ineffective debt settlement companies. Hiring one of these companies is the first mistake that many debtors make.
The second mistake most debtors make when negotiating is trying to pay the debt collector prior to getting terms of their agreement in writing. Debt collectors break the law everyday. You should expect them to continue collection efforts even if you have a verbal agreement with your collection agent.
Your negotiation should request deletion of the negative credit record from your credit bureau reports. While credit bureaus do not like this, debt collectors frequently agree to this as a provision of getting paid.
It is possible that a debt collector may want a higher percentage of the debt if they will agree to remove the record from your credit report. However, this may be worth the extra expense upfront, especially if it helps to reduce your future borrowing costs.
The best way to obtain a written agreement with your debt collector is to send them your request in writing. A pay for deletion template can be modified to fit your needs without necessarily having to utilize an attorney. In fact, many of these are available online free of charge by attorneys.
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