Collections Debt and Your Credit Score

All overdue debt payments are stressful, but collections agencies are the most unpleasant creditors out there.  When they contact you by mail, they print their notices in garish colors.  They offer several options for lump sum payments and installment plans, but as often as not, they tell you nothing about how you incurred the debt or why the collection agency is the one entitled to collect it.  They call you on the phone from numbers that look like they could belong to entities with which you would willingly interact; original creditors are not the ones that constantly bug you by phone about your debts.  Worst of all, you did nothing to become indebted to the collection agency.  The only reason you are interacting with it is because a company with which you incurred a bill you couldn’t pay sold your debt to a collection agency for pennies on the dollar.  For all you know, the collection agency that is calling you now could have bought the debt from another collection agency, and it could have bought it from a third.  To add insult to injury, collection agency debts wreak havoc on your credit report.  For help getting collection agency debts off your credit report, contact a Boca Raton credit repair lawyer.

How Do Debts in Collections Affect Your Credit Report?

Creditors report it to the credit reporting bureaus when you make an installment payment, and also when a pay period goes by without them receiving any money from you.  Once your payment is 90 days overdue, they have the right to sell your debt to a collection agency, and they often do, because even though the collection agency pays the original creditor only a fraction of the face value of the debt, at least the creditor is getting some money, and at least they are getting it quickly.

When this happens, you can settle the debt with the original creditor, you can settle it with the collection agency, or you can just lie low, knowing you can’t pay, and wait for the statute of limitations to expire.  No matter which of those paths you take, an item stating that the original creditor sold your debt to a collection agency remains on your credit report for seven years.  In other words, it is as stubborn a negative mark on your credit report as a bankruptcy filing.

Is Pay for Delete a Real Thing?

The only way to remove the collection agency marking from your credit report sooner than the seven years is if the creditor contacts the credit reporting bureaus and tells them to remove it.  Creditors are supposed to do this when you repay the debt, but most of the time, they do not.  You can call them and tell them to have the credit reporting bureaus remove it, but there is no guarantee that they will follow through.  Therefore, the surest way to get it removed is to pay the creditor to have the credit reporting agency to remove it.  This sounds like a plan, but the creditor might just take your money and leave the negative mark on your credit report, making you an even bigger chump than before.  Therefore, you should get a “pay for delete” agreement in writing before you pay.

Work With a Debt Lawyer About Collections Debt

A South Florida debt lawyer can help you if your debts have gone to collections and wrecked your credit score.  Contact Nowack & Olson, PLLC in Miami, Florida to discuss your case.

Source:

msn.com/en-us/money/personalfinance/how-to-remove-collections-from-your-credit-report-a-step-by-step-guide/ar-BB1qiogL?ocid=msedgntp&pc=ACTS&cvid=b8ab987abe8a4b2b94aba9acbe0998bc&ei=54