Pay The Collectors Or Letters of Dispute?

Question

After much reading, I am looking for the best approach. I have 3 open accounts listed with the 3 agencies. The total amounts are small ($425, $763, $178).

Is it best to first send out a registered letter of dispute to each collection agency and see if they respond within 30 days? If not then report it to the credit agencies?

Or do I just pay the collection fee's and move on? After trying to pay the full amount owed ($763) and getting $200 in interest thrown in my face, I am hesitant to try and settle with the others.

Questions:

a.) How to best handle the existing negative tradelines?
b.) What steps do you advise to start the credit repair process?
c.) Is it possible to remove payroll deducted child support from the credit report itself? I’m not sure if this is standard but child support shows up as credit?
d.) Any way to dispute the late charges from the mortgage and 2nd mortgage? Can I request that they prove that I was late and since it was 3+ years ago they may have trouble?

The mortgage is 3 years old

Answer 1

With years in the credit business:

1. Do not pay the entire collections. The sleaze balls should not have added interest on the debt. Next time, call and settle for less than the total amount. However, get the settled amount in writing before you pay it - and don't pay anything by phone. I can't stand when this industry takes advantage of people.

Go to www.ftc.gov and click on "consumers". Read through the federal guidelines and laws on debt collection.

2. You have 30 days to dispute from the original letter. You can certainly dispute the debts now, but they will not come off your credit report. Even if they can't deliver the verification (as required by law) don't expect them to remove the debts. If they don't remove them, file an online complaint with your state's attorney general's office as well as their industry organization, the ACA.

3. You handle negative tradelines by disputing them. If the bureaus can not verify the debts, they must be removed.

4. Please see some of my other posts on how to start the repair process.

5. Your child support usually only shows up if you are behind. However, your state may be one that lists it on your credit bureau to ensure creditors are aware of it. I have not heard of this, but it might be entirely legal. If you are behind (or have been behind) this might make much more sense. If you are currently behind, dispute the debt when it is current. You might find the state will verify it is paid and you might be able to get it removed. No promises here.

6. Yes, you can certainly dispute the late mortgage payments. Again, it is the burden of the bureaus to verify it. And yes, you might get lucky, but don't hold your breath. However, I do recommend doing this with any negative information!

Answer 2

Definitely send out the dispute letters on the collections. If nothing else, it buys you a couple weeks time. Do not tell the credit bureaus about them if they don't reply though.

Definitely try to negotiate the balances on those collections. Never send a payment until you have a written payoff amount from them first. NEVER. Before you try to negotiate, be sure you can pay them by Western Union or something within 24-48 hours, so have money ready. Start offering 10 cents on the dollar, they'll probably talk you to 50 (half of balance). Just don't pay til you have a fax or something confirming it, otherwise 2 years later someone will come after the rest.

Once you've paid all of them, dispute the accounts with the credit bureaus. Any inaccuracy of any kind is ok to dispute. Most collectors won't respond to disputes on paid accounts. This way, the bureaus are required to remove them from your report. If it doesn't work the first time, keep trying. It takes 45-60 days for each cycle, but it's worth it.

Child support would only show up on your report if you have a delinquent balance. The only way to clear this is to speak with the county you are paying. If you are set up on a plan to get caught up, and have been performing as promised for 6-12 months, you might be able to get them to stop reporting the delinquent balance, since you are effectively now "paying as agreed".

Dispute the late payments on the mortgage. Make your lender prove it somehow. Some lenders delete specific data on payments after some period of time. Demand to know the precise date each payment was actually posted. Demand to know the precise time the check was received by them. If those dates don't match, dispute the late report. Demand anything else you can think of. See what happens. Try, try again.

Answer 3

I always try other options first before parting with my hard earned money. The best way would be to DV the collection agencies, to see if they can prove you have the debt. They have to respond if you DV them in the first 30 days. For recent collections and/or those with low amounts, it might be good to just pay those off. It not worth something being on your credit for $200 if it takes years to comes off. For older items, disputing and DV is the way to go. It's possible they won't even be able to locate the original copies of the debt.

Answer 4

dispute