Having a collections record on your Credit file can negatively impact your credit score. While Collection accounts do less damage the older they get, they will still remain on your report for 7 years.
Despite this, there are techniques you can try to remove collections accounts from your Credit Report. In many ways, these are the easiest accounts to get off your credit report, but there are no guarantees. In general, collection companies tend to have poor documentation and many are not even licensed or authorized to collect on the debt. With this shaky status, and some negotiation, you may be able to get the collection account permanently removed from your credit report.
1. Pay for the Deletion
Paying for deletion tends to be most successful for small collection accounts of $500 or less. Using this strategy, you enter into an agreement with the collection agency to remove the listing from your report if you pay the debt in full. Make sure you get the agreement in writing, however, to make sure the debt collection company holds up its end.
2. Settle your Debt
Another technique that may work for amounts over $1,000 is negotiating with the agency to reduce the amount of the debt to something you can pay in one lump payment in exchange for removing the listing from your credit report.
3. Debt Validation
This tactic involves leveraging your consumer protection under the Fair Debt Collection Practices Act to force the company to provide documentation to prove the debt is actually valid. This is a somewhat aggressive tactic, and you’ll need to write a letter to the agency. If they do not respond, you may need to threaten a lawsuit.
4. 623 Dispute with Your Original Creditor
With this strategy, you leverage protection under section 623 of the Fair Credit Reporting Act (FCRA), which allows you to dispute negative information directly with the company that reports it to your credit file. You start by requesting an investigation, and the company has to respond within 30 days by law. To use this strategy, you will need to dispute the negative accounts on your credit file with the appropriate credit bureaus. Surprisingly, this technique can be very effective as many collection agencies simply don’t maintain any documentation to back up their reporting and collection attempts.
5. Credit Bureau Disputes
Finally, this is the most basic way to remove collection accounts from your credit, and it has the lowest chance of success if the company maintains any information on your account and confirms it with the bureau. It involves writing a letter to the credit bureaus to request an investigation of the collection account, although you can also make this request online through all three of the bureaus: TransUnion, Experian and Equifax.
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