Question about Credit Repair/Debt Settlement?

Question

I have a bunch of negative, but unfortunately accurate, items on my 3 credit reports. They range in amount from a stupid little $28 to a whopping $6300 auto loan that is from 1995. What do i pay off? What do I dispute? Who do I contact first - Credit Bureaus for dispute or Creditors/Collection Agencies for settlement for removal? Will they really remove it from my reports? Do I deal with the the original creditor or the collection agency that is reporting it to the CRAs. My total debt is only about $11000, do you think I can turn my credit around? If so, how long do u think it will take? My scores are in the 540 range.

Answer 1

Do not touch the negatives that are more than 2 years old. Updated record will hurt more than any benefits. Dispute the negatives more than 7.5 year old with Credit Bureaus, demand to remove this records in accordance with the law. Deal with Credit Bureaus in writing directly but not with original creditors or collections if you have clear proof that the record is wrong or old. It will save you time and efforts. They have 30 days to remove the record by law. Amount of your debts matters in relation with credit limits and number of trade lines. If you max out your credit, it will take longer to turn it around unless you can pay them down at once. I will estimate from 6 to 12 months to see substantial changes in your score if you do everything right. However, do not expect 700 and more with bunch of derogatory records.

Answer 2

If they are legit, you can't dispute them.

Get a copy of your credit report. Start with the newest bad debt and work back to the oldest. The older the debt, the less impact on your score.

It is likely that the original creditor has sold off the debt to a collection agency so contact the collection agency. You can negotiate settlement for less -- 50% to 75%. Lump sum payment gets better deals. Payment plans have to be short term. You can ask the negative be deleted for payment in full. Get any settlement agreement in writing before you pay and don't give them access to your bank.

Some of the negatives will still be on your credit report but will show paid. This is better than unpaid but won't really increase your score. Creditors do look at the whole report not just he score.

It will probably take you 2 or 3 years to clean up your report, if you work at it. During that time, you have to pay all your current bills on time. You will need a 2 year history of on time payments to really see a big increase in your score.

Answer 3

Anything that is older than 7-years form the date of first deliquency, like the car, dispute directly with the credit bureaus they should be removed.

Anything that is past the statute of limitations, don't worry about it. You can still be sued but all you have to do is show the court that the S.O.L. has expired and it will be dismissed.

Anything else that is left and you want to pay, contact the collection company and say that you will pay but only if they will remove the item from your credit bureau. If they won't don't pay them, what's the point, it will drop off after 7-years anyway.

I have posted a link so you can look up the S.O.L. for your State.


http://www.bcsalliance.com/index.html

Answer 4

Dispute any debt older than 7 years (from date of last activity) directly with the credit bureaus. As these fall off, your score could improve.