Question about fixing credit

[Jameel]

Once debts have gone to collections
For example say I have
Debt A - $5,000 - one debt
Debt B - $5,000 - consisting of 15 smaller debts

When you haven't made any payments for several years

1. Pay them off in full
2. Settle and pay a %
3. Pay off A or B first?

Does one have a bigger 'benefit' over the other in the long run? How long will it really take to get back up to a respectable level of credit? 10 years?

 

[jryan21]

It depends on what state you are in. Most are either 7 or 10 years before they have to stop reporting. This doesn't necessarily mean they won't still try to collect.

Your best bet would be to go from smallest to largest and look to settle around 50%. Don't fuck around with trying to pay them in installments. If you give them anything and it is an old debt, it will 'restart the clock'. That's why a lot of them will try and hit you just for $20 over the phone. Consult with a professional before dealing with anyone. Even acknowledging a debt could hurt you if you don't understand your rights. There are companies out there who just cold call people and try to get them to acknowledge->pay a debt.

If you try to wait them out, there are a few of them out there who will try to hit you with a suit right before their clock runs out.

 

[Rage9]

I'm assuming these are not student loan debts.

If it's been several years you need to check if those debts can even be collected. In most states even though you owe the debt it can no longer be collected:

Statute of Limitations on Debts

Furthermore after 7 years of inactivity they should fall off your credit report, you can dispute the listings with the Credit Reporting Agencys to maybe get them off faster.

Credit Repair - Free Guide to Fixing Your Credit Step by Step

 

[tygoldberg]

Is having sound credit in your future plans if so, 2

Is your conscience getting the best of you if so, 1

Feeling you don't owe a damn thing if so, 4.

 

[Rage9]

Your best bet would be to go from smallest to largest and look to settle around 50%. Consult with a professional before dealing with anyone. Even acknowledging a debt could hurt you if you don't understand your rights. There are companies out there who just cold call people and try to get them to acknowledge->pay a debt.

I disagree 100%. After the Statue of Limitations has run it's course you can safely tell the Collection Agency (CA) to pound dirt. Most CA's are dirty as shit as well, so read my links above and play the game. If they fuck with you take em to small claims.

 

[music4mic]

I've used this to get some stuff taken off:
Sample Pay for Delete Letter

Basically, write them and offer the ~50% of debt in exchange for them removing item from your report. They'll write you back saying we want XX% and we'll consider the debt settled. Write back a second time agreeing to pay whatever their XX% they requested in return for having item deleted. My experience is they'll agree the second time once you've agreed to pay their amount. Just make sure you get it in writing so you have something to go to credit agencies with if they try to back out after you've paid.

 

[Jameel]

It depends on what state you are in. Most are either 7 or 10 years before they have to stop reporting. This doesn't necessarily mean they won't still try to collect.

It hasn't been nearly that long I'd have to wait another 4-6 years based on that.

[Your best bet would be to go from smallest to largest and look to settle around 50%. Don't fuck around with trying to pay them in installments. If you give them anything and it is an old debt, it will 'restart the clock'. That's why a lot of them will try and hit you just for $20 over the phone. Consult with a professional before dealing with anyone. Even acknowledging a debt could hurt you if you don't understand your rights. There are companies out there who just cold call people and try to get them to acknowledge->pay a debt.

So is there no point at all in paying the balance in full? I assumed it would show differently on your credit Full or Settled or something. Not sure if it even matters.

You are right about them calling and trying to get $5 bucks and shit. They haven't had my number or address in years since I've always lived in random places not on any lease. No landline, just prepaid cell or Google Voice

 

[jryan21]

I disagree 100%. After the Statue of Limitations has run it's course you can safely tell the Collection Agency (CA) to pound dirt. Most CA's are dirty as shit as well, so read my links above and play the game. If they fuck with you take em to small claims.

Yeah, I was under the impression he was 2-3 yrs into them at the most. If it's closer to the SOL, age would definitely be a greater factor than amount.

So is there no point at all in paying the balance in full? I assumed it would show differently on your credit Full or Settled or something. Not sure if it even matters.

The way it would work is, you agree to pay a percentage to settle (usually they make some kind of offer), and they will report 'paid in full account closed'. It goes without saying, all this shit needs to be in writing. Usually, 50% is around the original amount before all the interest, etc. had been tacked on. They still make money, cause they probably bought the debt for about 25%.

 

[Jameel]

I'm assuming these are not student loan debts.

If it's been several years you need to check if those debts can even be collected. In most states even though you owe the debt it can no longer be collected:

Statute of Limitations on Debts

Furthermore after 7 years of inactivity they should fall off your credit report, you can dispute the listings with the Credit Reporting Agencys to maybe get them off faster.

Credit Repair - Free Guide to Fixing Your Credit Step by Step

Nope no student loans. One thing is a hopsital though will this fall off maybe?

 

[jryan21]

Nope no student loans. One thing is a hopsital though will this fall off maybe?

Be glad they are not student loans. They are on the same level as owing the IRS; you can't discharge them via bankruptcy. The only 2 ways to deal with student loans are :

1. pay them.
2. die.

 

[Jameel]

I've used this to get some stuff taken off:
Sample Pay for Delete Letter

Basically, write them and offer the ~50% of debt in exchange for them removing item from your report. They'll write you back saying we want XX% and we'll consider the debt settled. Write back a second time agreeing to pay whatever their XX% they requested in return for having item deleted. My experience is they'll agree the second time once you've agreed to pay their amount. Just make sure you get it in writing so you have something to go to credit agencies with if they try to back out after you've paid.

This seems pretty slick, nice.

 

[Jameel]

Yeah, I was under the impression he was 2-3 yrs into them at the most. If it's closer to the SOL, age would definitely be a greater factor than amount.



The way it would work is, you agree to pay a percentage to settle (usually they make some kind of offer), and they will report 'paid in full account closed'. It goes without saying, all this shit needs to be in writing. Usually, 50% is around the original amount before all the interest, etc. had been tacked on. They still make money, cause they probably bought the debt for about 25%.

Yeah I am 2-3 into them at most of not paying. In my case would I be better off trying to do this letter - Sample Pay for Delete Letter and getting them removed in exchanged for payment?

If it stays on my credit as paid in full won't anyone be able to still see the 3 years of non-payment. That's what shows on my credit report, just months and months of red non payment marks for each month.

Does that still show if it's changed to Paid In Full?

 

[jryan21]

Here is a good resource, particularly if you want to know about the people holding your debts, and the type of shit they've done:
Bud Hibbs

 

[Jameel]

Here is a good resource, particularly if you want to know about the people holding your debts, and the type of shit they've done:
Bud Hibbs

Damn I wish I was more aware of this. I had one company harass the fuck out of me and yell at me "MAN, GIMME MY MONEY MAN PAY YO' DEBT". :bootyshake:

 

[quintana]

I disagree 100%. After the Statue of Limitations has run it's course you can safely tell the Collection Agency (CA) to pound dirt. Most CA's are dirty as shit as well, so read my links above and play the game. If they fuck with you take em to small claims.

With the Statute of Limitations, not only does the debt need to be over 7 years old, but you need to receive no contact from the creditor for that period, too.

If they've still been in contact then the debt isn't going to just clear itself automatically.

On the plus side, if you've been able to not pay a penny for years and they haven't tried to apply for a bankruptcy order then you can easily negotiate a full and final settlement at a fraction of what you owe.

 

[MSTeacher]

Write the collection agency. Use certified mail, signature on delivery with return receipt.

Demand that they provide you with a copy of the original contract you signed with the lender for whom they are collecting, a copy of the contract that shows that they do legally own the debt, a copy of their legal charter indicating they are allowed to collect debts in your state, and a copy of the full accounting record of the loan from start to current.

Wait 30 days.

If they fail to provide these things, write them again, certified mail, tell them to close your account, contact every credit bureau they report to and retract the record on your credit report, put all of the above in writing, and never contact you again regarding the debt or you will take legal action against them.

If they do come through with the paperwork, contact the credit bureaus directly, certified mail. Tell them you want them to validate the debt in question.

Wait 30 days.

If they do not produce paperwork validating the debt write them again, certified mail, and tell them to delete the debt record from your report.

If they also produce the paperwork validating the debt then yeah, start negotiating with the collector. Start obnoxiously low. If you can pay 30-40% tell them you have a lot of bills to pay and they can either take xx% now or forget it.

 

[Jameel]

Write the collection agency. Use certified mail, signature on delivery with return receipt.

Demand that they provide you with a copy of the original contract you signed with the lender for whom they are collecting, a copy of the contract that shows that they do legally own the debt, a copy of their legal charter indicating they are allowed to collect debts in your state, and a copy of the full accounting record of the loan from start to current.

Wait 30 days.

If they fail to provide these things, write them again, certified mail, tell them to close your account, contact every credit bureau they report to and retract the record on your credit report, put all of the above in writing, and never contact you again regarding the debt or you will take legal action against them.

If they do come through with the paperwork, contact the credit bureaus directly, certified mail. Tell them you want them to validate the debt in question.

Wait 30 days.

If they do not produce paperwork validating the debt write them again, certified mail, and tell them to delete the debt record from your report.

If they also produce the paperwork validating the debt then yeah, start negotiating with the collector. Start obnoxiously low. If you can pay 30-40% tell them you have a lot of bills to pay and they can either take xx% now or forget it.

So this works based on them being lazy and not providing you with the original contact information and what not?

Awesome tips btw guys

 

[Rage9]

With the Statute of Limitations, not only does the debt need to be over 7 years old, but you need to receive no contact from the creditor for that period, too.

If they've still been in contact then the debt isn't going to just clear itself automatically.

On the plus side, if you've been able to not pay a penny for years and they haven't tried to apply for a bankruptcy order then you can easily negotiate a full and final settlement at a fraction of what you owe.

No, you are wrong. It has nothing to do with contact with the CA. That is irrelevant.

It's 7 years from the date of last activity, which is the last time you paid on it. This can be different by state because some states you can pay on it after it goes in to collection and still get to use the charge off date or something similar.

This isn't always the case because there are scum bag debt collectors that will change the last activity of the debt. If you can catch them doing this it's a slam dunk case. However if they are doing this they probably have jack shit for proof of debt anyways.

Don't forget you can always ask for validation from the CRA, which they will almost always verify. You then turn around and ask for validation of your debt with the CA. Since a lot of CA's don't even have anything to back up the debt, they'll probably not be able to validate. If they can't they are committing defamation of character and you take them to court if they don't remove the listing.

Like I posted earlier, play the game, you have nothing to lose. It takes a while, but if you want to get shit knocked off your credit report you have to do it. Start by asking the CA for debt validation.

 

[MSTeacher]

So this works based on them being lazy and not providing you with the original contact information and what not?

Yep. edit: and as rage said, a lot of times they don't even have proper records to furnish in the first place.

 

[Rage9]

So this works based on them being lazy and not providing you with the original contact information and what not?

Awesome tips btw guys

Yes, you'd be surprised how often they have no paper work. If they can't prove you owe the debt they can't collect.

Here the letter I've used in the past:

Sample Letter 9 - Requesting a Collection Agency to Validate a Debt

Make sure your letter states they are not allowed to transfer you debt to another CA or you will sue them as well.