Published: by jianjun lu |
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I have read the majority of the responses. A few of them I don't agree with on the premise that it is faulty informatation. However, here's what I've learned from some of the credential advice that I've read on here which has helped me to improve my credit score. To many of you, a great big THANK YOU! I hope this help many others as well.
You can do one of two things. I have tried both. The first suggestion is a very slow and long waiting process. The second suggestion is must faster.
Suggestion 1
If the debt is old for example 4 to 5 years old and if you are not planning on purchasing a car/home in the near future, let the credit stand and run its course of 7 years. It will be removed from your credit report.
It is important to remember that you can not contact the creditor or acknowledge the debt with the creditor. (Especially when they call you.) When you do this, the time clock of 7 years does start over from the most recent date of acknowledgement.
I exercised suggestion 1 with a credit card that I closed years ago. Although I closed it, they continued to charge me interest on my balance. They are not supposed to do this. So, I went from $5000.00 balance to $20,000.00 balance over a a span of 5 years of none payment. I refused to pay them until they corrected my account. They wouldn't do it, I didn't pay them. I would have been stuck paying the $20,000.00. I didn't acknowledge them when they called or sent correspondences. I wasn't planning on purchasing a home/car, so I rode it out. It's been removed from my credit 5 years ago now. Thank You Lord.
Suggestion 2
You must not only pay off the debt in collections, but you must also have it removed from the report all together. This will help you gain 20 pts. (Paying off the debt in collection alonewill NOTimprove your credit score)
To have it removed, write a letter of appeal to the creditor/collection agency requesting that they expedite the removal of the credit off of your report. Eventally it will be removed in 7 years, however, who's trying to wait 7 years if you're trynig to buy a house, car, etc....
When writing your letter of appeal, it is very helpful to add a brief summary as to the reason why you defaulted on the credit item, notate that you are currently practicing a debt reduction plan and state your goal. Also state your request that it is removed from all three credit agencies.
When I worte my letters, I explained to them that I am a Cancer survivor trying to restore my credit so that I may purchase a home for my family. My credit was greatly affected when I was diagnosed 5 years ago. During this time, the economy crashed, I didn't qualify for any programs because of my gross income which does not take into account loss of pay due to time/pay loss from work to attend numerous and frequent doctor appointments. Prior to this monumental time in my life, my credit was great.
In the past two years I have finally regained controlled of my finances. Since I've paid off my car note, I use that money to pay off past/current debtors. You don't miss what's already been leaving your pocket. I started paying off $300.00 a month. The first year I paid $100.00/$20.00 per account trying to cover as many debtors as I could. This helps to keep current debts from going into collections and reduces the debt that's already in collections. The larger payments were applied to those already on the credit report and the lower payments were applied to those not on the credit report. On year two, I increased the payments to $500.00/$50.00 as I had a payraise due to my earning a higher degree and I no longer have daycare expenses.
My Results: My financial diet is paying off tremendously. I have greatly reduced my debt to credit ratio. My finances are flowing more freely. We have been able to rebuild our saviings. My family and I are able to enjoy life and activities. Two weeks ago I mailed my letters to 6 creditors. I heard from 2 of them the very next day. Snail mail was actually speedy for once. Lol! I just heard from another debtor yesterday. They have all agreed to remove the debt from all three credit reports. I can't wait to hear from the other 3. Whoo Hoo!
THE BIG KICKER IN ALL OF THIS IS THAT I DIDN'T PAY ANYONE A DIME TO INVESTIGATE, CONSOLIDATE, MANAGE OR ADVISE ME ON A THING. THANKS TO PEOPLE LIKE YOU HERE ON CREDIT KARMA.
I HOPE THAT I AM HELPFUL TO YOU AS YOUR ARE TO ME.
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