Becoming Who You Want To Be

People often wonder if removing a charge-off from their credit report is possible. It can be done, but it may be difficult.

Some people are unclear as to what a charge-off actually is. A charge-off is a debt which a creditor no longer feels it can collect and subsequently decides to write-off. This will typically happen after several months of missed or late payments during which the creditor will send numerous letters and will try to communicate with the borrower by phone.

It would be wise to contact the creditor at this point and try to work out a solution so the account will not be sent to collections. You should never ignore when the creditor is attempting to contact you because this will look as though you are trying to avoid the debt entirely. If you work with the creditor, you may be able to reach a compromise or arrange for a payment plan to get yourself back on track.

It is important to understand that once your debt is written-off, your creditor may decide to pass or sell the debt to a collection agency. The collection agency will then attempt to collect the debt using any method of harassment and threat available to it, including the filing of a law suit to collect the debt.

Your credit report can carry a charge-off entry for seven years. Your chances of obtaining additional credit will suffer and your credit score will be greatly damaged. These are not things you want to happen! In light of this, it is best to try to have charge-offs removed.

To begin the process of removing a charge-off from your credit report, you need to request a copy of your credit report. Once you receive the credit report, check to see that all the information is accurate. If any entries on your credit report, including your charge-off, are false or inaccurate, you can attempt to have those entries removed. To do so, you will need to write the credit reporting agency and request the revision or deletion of the offending entry. Make sure to include copies of any substantiating documentation. The credit reporting bureau has 30 days to verify your claim. If it cannot obtain verification within 30 days, it must remove the false entry.

Additionally, another option you have is to contact the collection agency and explain that you would like to arrange payment. Debt is normally purchased by collection agencies for cents on the dollar. Because of this, you might want to try to arrange a lump sum payment if you can come up with the money. By doing this, you may be able to negotiate a lower total amount owed. Alternately, you can attempt to arrange a payment plan. Whichever path you decide to take to pay back the debt, be sure to obtain an agreement in writing which states that the charge-off credit entry will be removed in its entirety from your credit report or that the offending entry will be revised to “paid” status.

To summarize, if you find yourself falling behind in your payments, contact your creditor and try to work out an arrangement to avoid a charge-off. If the charge-off account ends up with a collection agency, attempt to negotiate with the collection agency to pay the debt and remove the charge-off entry from your credit report.

Learn How to Stop Midland Credit Management in its Tracks. Free Tips to Escape Debt in Less than Seven Days at www.MidlandCreditDebt.com.