I have charge off on my credit?

Question

I am planning on paying it for a settled amount when i recieve my income tax check. Will this make my credit look any better, is it worth it for me to pay it, or just let it fall off after seven years? Will it benifit me to pay it in terms of how my credit looks?

Answer 1

Make sure you don't send a dime until you have any settlement agreement in writing. Don't even consider it. I have seen numerous clients who did so, then the remaining debt got sold to another collector and they had to start over. Faxed copy is fine, just get it somehow.

Paying a chargeoff can actually drop your score in the short term, since you are making the last activity on that account newer. That being said, you'll always be held down by an open account until it's paid, so in the long run, paying it is always best.

http://www.bankrate.com/brm/news/cc/20040116b1.asp

Click this link, it will tell you if the statute of limitations is still in place for your debt in your state. If it's not, you can't be forced to pay it, they can't sue you for it, but it won't go away until 7 years from the date of last activity. And the limitations clock started the last time you made your last payment to them. Paying them $1.00 now will restart that clock, so don't send any "good-faith" payments unless you're well within that timeframe anyway.

Answer 2

Many creditors threaten their borrowers with charge-off and make it sound as though it is the end of healthy financial life. This happens if you fail to make regular payments on your bills. This term scares many people. This article explains everything you need to know about charge-off.

As the term charge-off includes the term charge, many people think term means cancellation of the account by the creditor. This means you cannot pay for anything with your credit card. But it not what the banks mean. According to banks and bill collectors, a "charge-off" is the point at which the creditor writes off the outstanding debt as a "bad debt."

Answer 3

You need to get a pay-for-deletion letter from the collection agency BEFORE payment.

Then, once you pay the delinquent amount, you should submit your pay-for-deletion letter (with the collection agency's letterhead on it) to the credit bureau as proof that the collection item should be removed.

Without the pay-for-deletion letter, it is most likely that the credit bureaus will show the collection item as 'PAID' until it has aged 7 years on the credit report from the date of 1st delinquency.

Refer to the hyperlink for what a pay-for-deletion form letter looks like.

Go this route!! It will REMOVE the credit entry if you get the collection agent to agree.

Answer 4

Pay it. A paid charge off looks a whole lot better to the banks than an unpaid one.

Besides, why wait 7-years when you can live up to your obligations now and do the right thing.

Answer 5

yes it can get better but i need a business partner