Charge-Off removal from your credit report

One of the negative effects on your credit report is a charge-off. Charge-off is a result of your failure to make credit card payments for several months usually up to six months in a row. When the payment was not made for several months, creditor writes off the debt as a loss, shuts down your account, and expects you to pay the due balance in full.

Till the time your account’s charge-off is dropped there has been an adverse affect on your credit score. Your credit limit has already been lowered by the credit card issuer. The account remains for around seven and a half years on your credit report. That is quite a long time for a negative entry to last on your credit report.

Offer to pay the debts

Offering to pay the debts you owe is one of the most effective ways of removing negative items for your credit report, the creditor in return drops all negative charges from the report.

This only works on unpaid charge-offs. But you cannot ask for a charge-off removal despite of payment if the charge-off existed on your credit report before.

Keep few things in mind before going on the “pay for deletion” route:

  • Don’t pay the full debt if the charge off is old. Instead, negotiate for paying less than what they are demanding. Request for 50% and move ahead from there.
  • Make sure to make the deal where charge off can be removed; some creditors might claim that they cannot help in the removal but that’s not true.
  • Debt collector must never get access to your bank account.

Document the Agreement

Before sending a check, better get the agreement you made in writing even if you negotiated on the phone.

This can be done in two ways:

  1. Ask for a copy of agreement on company letterhead from the person who spoke with you.
  2. Also, get the details such as name, mailing address and phone number of the person you spoke with. The copy of agreement must be sent via certified mail with the request of return receipt. Ask that person to sign and return the copy to you.

Do not make any payment until you have received the agreement in writing and you can prove that you made this deal with of the member from the creditor’s office. Check your credit report to see if there has been charge off removal once you fulfill your part of the agreement.

Advanced method for disputing over the charge off

If you cannot pay the balance currently due to lack of money or if an original creditor does not agree to remove the charge off from your credit report then you can opt to dispute over the negative entry on your credit report by advance method.

Copy of your current credit report is required for advanced method in order to dispute over the entry. See the charge off entry and look for all the details to ensure that everything in it is accurate. So be very careful and specific in going through the report. In case of an inaccurate entry, you have the right to dispute.

Things to verify accuracy:

  • Account Number
  • Names
  • Creditor name
  • Balances
  • Open data
  • Payment history
  • Charge off date

In case of any false information, write a letter to 3 credit bureaus respectively stating state where the inaccuracy exits in your report, the information is incorrect and needs to be altered.

If they fail to verify the incorrect information, they will have to delete incorrect information and remove the charge off.

If it doesn’t work, look for other prospective.

If a creditor does not accept your pay for delete offer or there has not been any inaccurate entry in your credit report so you cannot claim for dispute. Then what? Have patience.

Eventually your debt collector will connect with a new offer. You can also wait for your current collector to sell your debt to another. Charge offs can be bought and sold many times. If a certain collector doesn’t accept your offer the other one might.

If your first priority is debt resolving than removing charge off from your credit report then you can sign a settlement offer with debt collectors. This settlement might not improve your credit score but at least you will be free from debt.

Anyways, keep in mind that the charge off stays on your credit report for seven years. But the better behavior you add on your credit report the better it will influence your credit score. You can still manage to improve your credit score despite if having a poor credit history