How can I remove a paid collection item from my credit report?
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is4176 wants to know:
I have a collection item on my credit report for $245, I have paid it already. How can I remove it from my credit report? Is it better to talk to the collection agency to remove it or directly to the credit bureau? Tnx!
I have a collection item on my credit report for $245, I have paid it already. How can I remove it from my credit report? Is it better to talk to the collection agency to remove it or directly to the credit bureau? Tnx!
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Tagged with: Credit Bureau • Credit Report • Tnx
Filed under: True Credit
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All you can really do at this point is make sure that it is listed as “paid”. The negative item will remain on your credit report for 7 years.
If you had negotiated a “pay for delete” agreement, you might have been able to get them to agree to remove the item from your credit report for payment. But since you’ve already paid it, that ship has sailed.
They probably won’t agree to delete it after you have already paid it.
You could try to ask them for a goodwill deletion. I’d try this first.
You could also just dispute it with the credit bureaus and see if it falls off. I’d try this if they ignore/say no to your goodwill deletion letter.
on edit:
Don’t listen to anyone telling you that a “paid collection” notation is a positive account that will increase your score. It is an inherently negative notation on your credit report and will most likely decrease your score. The only thing a paid collection does is prevent them from suing you over the debt…which has nothing to do with your credit score.
Also, don’t listen to anyone telling you that this collection account has to remain on your credit report for 7.5 years as per the Fair Credit Reporting Act. The FCRA establishes the MAXIMUM amount of time an account may be reported to a credit bureau. It does NOT set a mandatory minimum amount of time an account MUST be reported. This is misguided advice that ignores fundamental principles of statutory interpretation.
delmoki is correct on this one. It will go from a derogatory entry to a regular entry and show as paid. It will still remain on your report for 7 1/2 yrs as per Running of Reporting Period – Section 605 [15 U.S.C. § 1681c] (date of last missed payment).
At least it has gone from a bad entry to a good entry and will increase your score
Hope this answers your question
LEGAL DISCLAIMER: The advice contained herein is for informational purposes only. It is not to be construed as Legal Counsel nor Legal Advice.
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Paying a derogatory item, even if you pay it in full, will NOT increase your credit score. The damage is already done by the default and it will remain on your file for 7-1/2 years from the date of first deficiency (NOT last payment).
However, creditors look at more than your score. They look at your whole credit report. A paid old debt looks better than an unpaid old debt.
While the FCRA doesn’t say a derogatory HAS to be reported for 7-1/2 years, it does say that the creditor can continue to report it for that period. The creditor can decide to not report a derogatory, but the debtor shouldn’t expect legitimate derogatory items to be removed by disputing them.
First go thru the collection company and ask them to send you something showing paid in full and request that they report correctly to the bureaus. If that does not work, then I’d make certified copies of the information they send you and send with a letter to each bureau and request that it reflect paid. Once per year, you can access. You have to set up an account with user names and passwords for all three bureaus so make sure you jot down the information b/c it’s hell trying to get those passwords reset. Once the credit reports are pulled, you can use the confirmation numbers to dispute anything that is incorrect on the report. By law, the bureaus have 30 days to investigate and make any corrections they find.
Good luck!
Paying a collection item may be the honorable thing to do, but not in your best interest. Check your credit report and if it’s marked as paid leave at that. You see, once you’ve paid you can’t dispute it successfully – otherwise why would you pay in the first place if the debt is not yours? Paying an item in collections dings your credit though not as much as leaving it unpaid.
This is the reason for negotiating for deletion before paying off.
A paid account is an honorable one. Down the road the account will diminish in importance. Take it as a lesson, keep paying your bills on time and in time it will fade somewhere in the background especially if you build up a good score.