Removing Numerous Settled Accounts

[csharp01]

Hello, My wife and I are trying to repair our credit in hopes of owning our own home within the next 6-12 months. We previously owned a home but were days away from foreclosing and we did a short sale. It was a USDA Rural Development Loan. We also had numerous credit cards and other unsecured debt that we hadn't paid on for a long time. All of the accounts had gone to collections except maybe a few chase cards. We ended up paying out a settlementabout 2 1/2 to 3 years ago on each account to bring all of the accounts to a zero balance and closing out the accounts. We currently only have a Student Loan that we are paying on and have not missed a payment now for almost 1 1/2 years. I have read quite a bit about people requesting the credit companies or collection agencies to remove the negative entry or change the status from settled to paid... Do I have the right thinking process or should there be other steps that I need to take... We are desperately needing to get our credit fixed and our scores up!!! Any and all help is greatly appreciated...

[Hal Jordan]

Well, first thing I would recommend is reading the beginners section on the one two punch and 623.

Go to freeannualreport.com and pull all 3 of your credit reports and get a list of all the negative items on there.

See which ones are charge off's and which ones are in collections. Basically see which debts are still held by the OC (original creditor) If they say transfered or sold you will need to see which one of the CA's on your report owns the debt.

If you have charge off's on there that just say "settled" you can write a goodwill letter to that OC and see if they will change the status to paid for you but it's pretty unlikely they'll do anything for you since they've already settled and gotten paid the agreed upon amount. They have no motivation to assist you. More than likely you'll just get a letter back saying they can't help you because they must report accurately to the CRA's (credit reporting agencies) accurately.

In this case you should dispute them directly with the CRA's for whatever reason. You can simply say this is not an accurate record and request they delete it. Perhaps you'll get lucky and they'll delete some of them. It happens all the time. For the ones that come back verified you will need to send out a 623 (detailed instructions in the beginners section) and go from there.

For collections you will need to send out debt validation letters and then dispute with the cra's (detailed instructions in the beginners section under the 1-2 punch).

Just make a list of all the negative items on your report and prioritize them. I'll tell you this Chrages off's are almost as bad as judgements and bankruptcies to your credit score so address them sooner than later.

Hopefully with the student loans you entered into a rehabiliation program which typically means after 24-36 ontime payments they remove all negative entries regarding the record from your credit reports.

Make sure you check your states statute of limiations on these debts as perhaps you are beyond the SOL with some of the CA's on your report.

And lastly.. read read read. If it doesn't make sense re-read it until it does. Read other people's posts about how they're dealing with things and read about other problems people are having the advice they're getting to resolve those problems and see how much of that advice you can apply to yourself.

It's going to take some work and some effort on your part but if you stick with it you'll get it figured and will more than likely be able to positively impact your score.

Good luck!

[chane]

It's annualcreditreport.com, but make sure you understand that it gives the CRAs 45 days instead of 30 days to investigate by ordering your report from that site. That's why we recommend buying them directly from the CRAs.

You can read the rest of what we recommend here:

Basic Step by Step Beginner's Guide to Credit Repair

[csharp01]

Guys... Thank you so much... I have been reading quite a bit the past few days and can't wait to get our credit problems solved once and for all! I know that it will be a hard journey, but am thankful for all those who came before me so I can have some positive encouragement...

Once again Thanks...

[Lian]

When a debt is legally satisfied, either by paid in full, or settled for less than the full amount, the current account status reads the same. It is simply "paid." The fact that it was settled for less than the full amount is posted to a separate code called "Special Comments."

A settled account will already have a "paid status," but backed up by the special comment of paid for less than the full amount.

I would never just dispute with a CRA without a specific reason. That is a frivolous or irrelevant dispute that can simply be dismissed without investigation. Identification of the specific error in reporting is a requirement of any dispute, and absence of it is grounds to dismiss it without any investigation. Additionally, disputing cavalierly through the CRA could result in the loss of right to investigation of a subsequent direct dispute. The direct dispute rules permit the dismissal of a direct dispute if it is based on the same issues previously disputed through a CRA. 16 CFR 660.4(f)(ii).