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Discussion in 'Credit Talk' started by star, Nov 21, 2001.
Any opinions would be greatly appreciated. Thanks
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In my opinion those chargeoffs really hurt. I was in the same boat with disputing charge offs, it kept coming back verified by the credit bureaus everytime I disputed. What I eventually did was contact the creditor and make arrangements for full deletion or some other favorable listing in exchange for payment. At this point, if they say they will remove the charged off status and the R9 and history of late payments, I am willing to pay it off (only if I have the agreement in writing.).
I am hoping that my scores will increase once the charge-off status is removed. I'll keep everyone posted.
Save your money, I paid off a charge off and then had it removed (agreement). My score went up a whole 4 points. I have gotten more points by disputing inquiries.
I wouldn't pay it off without total deletion. A "Paid" status on a charge off or collection account does nothing for your score and is a big negative to most future lenders with which you apply.
I liken it to a convicted criminal applying for a job at the bank - "Oh Mr. X your resume is very appealing - college degree - lots of skills..." (then they see the conviction)...."however, we really don't have a position for you at this time!"
Then when you have conflicting opinions the thing to do is to stop and think about it all, (which is what you have obviously tried to do) and come up with an answer that makes the most sense to you.
Now then, let me see if I can help you do that. First of all, what are the options?
1. do nothing because getting a chargeoff gone only nets you 4 points on your fico.
2. Sooth your moral conscience and pay it off no matter what happens to your credit since it don't make much difference anyway.
3. Get it off at all costs because it hurts you terribly
4. Only pay for it if you can get a written agreement to remove the entry from all 3 cras
So lets come up with answers
1. do nothing. It only costs 4 points. Unless of course a creditor actually pulls your report and looks at it to do his own analyzation rather than rely on some mechanical score. That's what they are likely to do with a serious purchase. Check you out in a serious manner. But what if you do nothing and they go for a judgment and garnishment? What do you do then. cry a lot? Waste your time going to court?
2.It may not make much difference in points, but it sure makes your credit look bad to have a paid charge off on there for as much as 5 to 7 years especially if reviewed by other than pulling a mere score. It's likely to hurt badly then
3. I think it's not only a case of it's hurting badly but also the possibility of judgment and garnishment still exists and you aren't doing anything to put a stop to that. Get one of those that you don't know how to get rid of and then you will have deep problems to worry about.
4. that's all well and good, but it don't happen all that often and that still don't take care of the judgment problems. Anything short of getting rid of the debt once and for all does nothing but prolong the agony of the possible judgment, unless of course you just plan on hoping it don't happen to you.
What you really should be worried about is getting rid of the problems at their source. then they won't ever come back to haunt you and they can't report debts that don't exist.
Any opinions would be greatly appreciated. Thanks
Hope those helped you
This should just about settle all the arguments about what works best.
Read my post on that thread and the conclusion one reaches about what is the best way to get the job done should just about be obvious.
Shouldn't be all that much to argue about after seeing that post.
Thanks for all the info, so If I pay a charge off will it be on there ANOTHER 7 years from when I paid it?
And, are you saying when I apply for a credit card they dont look at my report at all? Do they just look at a score? I know they "looked" at it when I went for a car loan, I just want to get some credit cards to start rebuilding and get confused when people say different things. Thanks again.
It's supposed to stay there for 7 years after you defaulted on the last payment that was due. How long it's going to stay there depends on you. If you do nothing and they keep reaging the account for you, selling it from one collection agency to the other then it might stay there a coon's age. You might just up and die with them still on there for you. In fact, I'll bet there are an awful lot of people who never did anything about their credit and died with those nasty remarks on their credit files.
It's obvious that they don't in many cases. If you go to a store and apply for their credit card, target, wall-mart, Home Depot, Sears, Penny's and a ton more, they have the answer in about 15 minutes or less. There is no possible way they could look at your entire credit file in that length of time. So they just pull a score and you meet their criteria or you don't.
Sure they do on major purchases like that.
People say different things for different reasons. Some say it's better to learn how to do it yourself. Maybe that's because they want to learn for themselves no matter what it takes or what it costs to do that. That's the way it was for me. And I have spent tremendous amounts of time and money learning how to do it. I bought about enough books on credit repair to fill a library with them all and I'll still buy any credit repair or law book that I can find. I produced my own CD which has all the full text of all of the US codes on it that deal with IRS and credit and criminal codes and IRS codes and lots more. The CD is jam packed to full with all sorts of legal stuff and it's so good that a lawyer can put it in his laptop and go to court and quote the law from it and know it's absolutely correct to the last word. It took many thousands of man hours to research and produce. And I'm still not done learning and I never will be. Others have found other ways to get the job done, and so just like me, they think their way is best because it worked for them. Each of us has to look at the evidence and decide what is best for them. Others are forced to do it for themselves because they simply don't have the money it might take to hire someone to help them or to do it for them which ever the case may be. Some people say I'm bad because I don't put out what I know for free, but I have so many people needing help that I have to hire people to help me.
Tremendous numbers of the people I help are hispanic and don't speak english very well. A man came to me yesterday and his daughter had been hit broadside by a drunken hit and run driver and all he had was liability insurance. $10,000 in medical bills for his daughter and a $28,000 automobile totaled. He and his wife are retired on Social Security. The creditor is beating him to death with phone calls and threats to sue him and he is scared to death they will take his home if he don't pay up. And there sits that pile of junk in his back yard he can't do nothing with. He and his wife were in tears over the mess yesterday and we had to call in his daughter to calm them down so they could talk about it. I get those kinds of people in my door everyday and often that includes Sundays and Holidays. So I simply can't do it for free.
What's best for you is always a personal decision and only you can make that decision. All I did was to show you what I might be able to do for you compared to what other methods and suggestions might be able to do for you. But you have to make your decision based on your own personal criteria. You just have to look at all the evidence and suggestions and figure out what you want to do and how to do it and go for it.
Don't pay without deleation.
1. A charge-off account will stay on your credit reports for 7 years AFTER IT IS CHARGED OFF. Paying it does not reset the 7 year clock.
2. The number of points your score will rise for getting a charge-off removed will vary. As it ages, it's detrimental effect lessens...thus the number of points you will gain decrease.. For example, a 4 yr old charge-off removed may only net you 4 points, but a 1 yr old charge-off will net you more.
Jmart, Sorry but I disagree on point #1 bud. I have seen the effect of paying...it DOES reset the 7 year clock. The "date of last activity" is updated when the charge-off is paid thereby re-ageing the account and in effect restarting the clock that the derog will remain on your report. That means it remains for another 7 years from date paid...SEEN THERE - DONE THAT...A Paid charge off is NOT much better than a UNPAID charge off (a recent collection account is a collection account, paid or not). It still is a derog and may in fact hurt your score drastically to update a derogatory account with newer "activity" on the derogatory account (ie paying it).
As for your second point, I agree...If you are close to the charge-off date it may be of benefit to pay, but for those who have lasted several years it will hurt more than help because of the diminishing beneficial effects of paying the CO and the powerful effects of recent negative activity. Always keep the leverage on your side and do what is best for your credit score.
The last 2 posts were 2 different opinions again, that is why this is so confusing! Some of mine are1 year old some are 4 years old-I just dont know what to do!
Both of the two posters who have once again confused you should not have. Both are speaking about a difference between practiice (what almost always happens in actual practice) and I am speaking about what the law says should happen. They are not wrong, I am not wrong. All of us are correct. If you are willing to stand up and fight and sue if necessary, then what I say can be enforced upon those collectors who cause the other two posters to be correct in what they say.
There is a post on this board and a copy thereof at http://www.creditwrench.com/westcap.html
This post is by a person who is very profssional and I can assure you an expert in what he does.
I know who he is and I know a lot about this person and what he says is probably 100% correct.
I think his idea is super to say the least. But do I have confidence that his idea all alone and by itself can be made to work? Sorry, but I don't. And in another post in the same thread George points out just one of the possible flaws in the perfect idea westcap proposes. I have tried to use westcap's idea (although not in the professional way that he puts his across) and the collection agency would have no part of it. That's why I fail to have confidence in westcap's excellent idea. So is his idea useless then? Well, not if you put the creditor/collection agency in a position where he has little other choice. The way you do that is to make him believe that he is looking down the gunbarrel of a $100,000 lawsuit and a real well known attorney standing there ready to pull the trigger and then give him the choice of getting sued or accepting the check with it's endorsement and then you have a situation where westcap's idea would obviously work like a dream.
Getting the collector in that position is not for someone such as yourself who is not unknowledgeable and experienced enough to make it work. Can you learn how to do it by yourself so you don't have to pay someone to do it for you? Of course you can.
Many people try to tell you that you don't have to pay anyone to do such things because you can get all the information and help you need to do it right here on creditnet for free. That's quite true and lots of people are doing it all the time and proving that it's true. If you are totally confused by the three seemingly differing opinions presented to you in this thread, then I have serious doubts that you can make it work all by yourself. But only you know what you can or cannot do. I have law students, doctors, attorneys and even one ex judge who have turned to me for help and are quite happy with what they got or are getting.
How can that be? Because I have the ability and the knowledge and the practical experience to know that westcap's idea is absolutely outstanding and can get the job done for those who honestly feel that they want to do the right thing and pay their bills like honorable people and not do anything at all to beat their creditors.
You have undoubtedly seen me say time and time again that one should never pay a crying dime once it's gone to collections because you will most likely start the 7 year clock all over again and my methods put a stop to it once and for all, which they do.
Westcap's idea suddenly changes all that and I no longer have to go around telling people they have to cheat their creditors. Westcap changed all that for me. He gave me a way to help those who want to pay their bills and believe that they must do so for their own personal reasons and are in a financial position to do so but don't want that 7 year hickey on their credit reports. It gives me a way to help those who have such large bills they can't pay even if they wanted to but have a few that are so small that they would look silly trying to fight over them.
It gives me lots of new options, new ways to help people but not by itself. Added into a system that's never failed yet but still has flaws that need ironing out then it's a very powerful tool. And that's what is needed, more and more tools to work with to get the job done right under any and all circumstances.
I do hope my comments help you to clear away the confusions you seem to have.
What Nave referred to often happens:
That a charge-off's date is reset when it is paid off, and remains on the report for 7 years after that.
The law says that the charge-off can only appear on the report for 7 years after that account goes into charge-off status, however. No account activity (paying the balance) can "reset the clock". CRA's sometimes mistakenly do this, and need to be STRONGLY REMINDED when it happens.
Basically as a rule of thumb, I'd only pay off the charge-off's if you get a written agreement to delete.
I found this on experian consumer info center
March 14, 2001
Does a charged-off account fall off your credit report seven years after the account was charged off or seven years after the debt is repaid?
I probably hear your question and ones like it more than any other. Figuring out when negative information is removed from your credit report can be very confusing, and understandably so. I am going to take this opportunity to answer your question and many others by listing the most common types of negative information that appear on credit reports, how long each remains on an Experian credit report, and from what point the time is measured. I hope this helps.
Delinquencies (30 â?? 180 days): Can remain seven years from the date of the initial missed payment.
Collection accounts: Remain seven years from the date of the initial missed payment that led to the collection (the original delinquency date). When a collection account is paid in full, it will be marked "paid collection" on the credit report.
Charged-off accounts: Remain seven years from the date of the initial missed payment that led to the charge off (the original delinquency date), even if payments are later made on the charged-off account.
Closed accounts: Closed accounts are accounts that are no longer available for further use. Closed accounts may or may not have a zero balance. Closed accounts with delinquencies remain seven years from the date they are reported closed, whether closed by the creditor or by the consumer. Positive closed accounts remain 10 years.
Lost credit card: If there are no delinquencies, credit cards that are reported lost will continue to be listed for two years from the date the card is reported lost. Delinquent payments that occurred before the card was lost are reported for seven years.
Bankruptcy: Chapters 7, 11, and 12 remain for 10 years from the filing date. Chapter 13 remains seven years from the filing date. Accounts included in bankruptcy will remain seven years from the date they were reported as included in the bankruptcy.
Child support judgments: Remain seven years from the date the judgment is filed.
Civil and small claim judgments: Remain seven years from the date the judgment is filed.
City, county, state, and federal tax liens: Unpaid tax liens remain 15 years from the filing date. Paid tax liens remain seven years from the paid date of the lien.
Inquiries: Most inquiries listed on your credit report will remain for two years. All inquiries must remain for a minimum of one year from the date the inquiry was made. Some inquiries, such as employment or preapproved offers of credit, will show only to you.
Positive open credit information remains indefinitely and paid positive accounts remain 10 years, making your credit report a great benefit for you in obtaining and using financial services. Negative information is purged from your credit report so that if you have credit problems you will have an opportunity to build a good credit history over time.
Thanks for asking.
Maxine Sweet is Experian's vice president of consumer education. Do you have a question or comment? Ask Max.