Hi, I have an account that has been charged off because I was ill and consequently unable to make the payments.
I am now well, and attempting to negotiate something with the bank that services the credit account (WFFNB, which services Pottery Barn).
I'd like to find a way to pay an amount that would either: (a) bring the account back in good standing, which WFFNB claims is not possible since the account has been charged off or (b) ensures Pottery Barn removes the charge off notation from my credit report.
I am hesitant to pay the creditor to whom the account has been sold because I've found that even if the account is paid in full, it still reports as a negative item on the credit report. (It would seem to me that if an account has been paid, it should reflect positively on one's credit report, regardless of the circumstances under which it was paid.)
What would be your advice in this case?
So I guess the second thing would be how to get accounts that are paid, albeit through a collection agency, to report positively on a credit report.
How to handle a charged off account?
Hello mkpitz,
Welcome to this community. As for your question, you can first send a "cease and desist letter" to the CA if they have already started contacting you. Let them know that you would like to settle the account with the original creditor. For writing a "cease and desist letter" you can check the sample letter available in "letters of credit", from creditmagic.com.
After this you can contact your original creditor, and let them know that you are interested in paying the dues. Request that you can pay only if they promise to a pay for delete agreement. Send them a "pay for delete letter". For this too, you can check the "letters of credit". With the pay for delete, the negative listing will get removed from your credit report.
NO NO NO
DO NOT SEND A CEASE AND DESIST LETTER.
this will tell the CA that they can go away or SUE! I can refer you to case histories where credit newbies did this and got a law suit. Never C&D until you are ready to draw a line in the sand. this is dangerous advice.
Look everyone hates CAs and would rather pay the OC but it might not be what is best for you. CAs will be more likely to settle for a lower price or even delete. Original Creditors RARELY do Pay for Delete. I am not saying it never happens but CAs invented it.
Go though the steps
I would complain to the Office of Thrift Supervision about WFNNB putting this in collection while you were sick
1. Send the CA a DV letter.
2 wait for documentation of the validity of this account
3. during this time they may make a settlement offer, counter with a lower one or ask for delete
4. if they are calling you, write a letter stating that the calls are inconvenient
reply
Yes cinnamngrl, I just missed the point that mkpitz should first send a debt validation letter first. Then if he believes that he does not owe the debt he can go for the cease and desist letter. Otherwise he can request the CA for a settlement offer or a pay for delete agreement.
nothing in OP said that they thought the debt didn't belong to them. C&D letters are very dangerous. They should only be used in specific situations. Never send a C&D unless you are not afraid of being sued about the debt. let us give cautious advice or none.
Reply to advice
Thank you very much for this advice, cinnamngrl. I have sent certified debt validation letters to creditors related to the accounts that came due while I was ill and consequently could not pay these accounts. If I do not receive debt validation within 30 days, are they in violation of the FCRA for keeping the accounts listed as a negative on my credit report?
no, DV letters don't have a time limit. No response can mean that they don't have enough records to prove the debt or they don't own the debt. The collection account cannot be listed on your report during this time. that would be a violation. the oc is already on your report. getting it off is your goal.
If they sell this to another collection agency without responding to the DV then that would be a violation too. Send a new DV and a copy of the old DV to the new CA.
If they don't respond to the DV, I would complain to the Office of Thrift Supervision.
Reply to cinnamngrl
Cinnamngrl,
Thank you very much for all of the great advice. It looks like collection agencies have removed their marks on the report, however, as you mention the original creditors are already on there, and the goal is to get them off. A few additional questions:
(1) Would the collection agency negotiate with the original creditor to get the mark off (once they've validated the debt and I've completed the next step in the process: sending the pay-to-delete letter)?
So at this point I will wait a bit longer, until it's been 40 or so days. If they (the collection agency) do not respond to the DV, and do not sell it to another collection agency, then I will complain to the Office of Thrift Supervision.
(2) If they don't respond and sell it to another collection agency, I'd want to start the process over with the new agency by sending a new DV and copy of the old DV. In the instance of this sale, though, would it still make sense to complain to the office of Thrift Supervision? What would this office do in either case?
1. No they won't help you get the OC
2. With the OC you send a 623 investigation request
623 investigation request
Thanks once again for the great advice. So the OC is going to be a separate matter, and I'll be sending a 623 request. But, just to make sure I've got the right next step, when you mention "the CRAs validated the tradeline" what exactly does that mean? I'm so new to all this, but I have to say that your advice has just been wonderful, and I've learned a lot.
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