Getting Debt Collectors to Remove Negative Information From Your Credit Report

If you are negotiating with a collection agency on payment of a debt, consider making your credit report part of the negotiations as well. You can try to get the collector to remove negative information from your credit report, perhaps in return for paying more on the debt. And if you get the collector to agree to accept less than the full amount to settle the debt, be sure the collector also agrees to report the debt as "paid in full" on your report.

Read on to learn how delinquent debts are reported and strategies for negotiating with collectors regarding information on your credit report.

How Delinquent Debts Are Reported on Your Credit Report

After your debt has been transferred or sold to a debt collector it will probably appear twice in your credit history. According to the credit reporting agency Experian, this is how it works: The debt starts as a current, never late account. As you get behind on the payments, it is typically reported as being 30, 60, 90, and then 120 days late. At that point the creditor is likely to charge off the debt. Its status will be changed to “charged off” and “sold to collections.” “Charged off” and “sold to collections” are both considered a final status. Although the account is no longer active, it stays on your credit report.

When the debt is sold or transferred to a debt collector, a new collection account is added to your credit history. It appears as an active account, showing that the debt collector bought the debt from the original creditor. If the debt is sold again to another collection agency, the status of the first collection account is changed to show that it was sold or transferred. Once again, the final status shows that the first collection account is no longer active, but that status continues to appear as part of the account’s history. All of the accounts—the original account and any subsequent collection accounts—will ordinarily be deleted at the same time, which is seven years from the original delinquency.(To learn more about how long negative information can remain on your credit report, see Credit Report Basics.)

Getting Collectors to Remove Negative Information

However, because creditors are not required to report information to a credit reporting agency, when you negotiate a debt settlement, ask to have any negative information about the debt removed from your credit files. The collection agency may tell you that this is not its decision—that only the original creditor can remove the information. Ask for the name and phone number of the person with the original creditor who has authority to make this decision.

Call that person and plead. Explain that you are taking steps to repay your debts, clean up your credit, and be more responsible. Emphasize that a clean credit report will help you achieve your goals. Be honest, but paint the bleakest possible picture of your finances. Explain illnesses and accidents, job layoffs, car repossessions, major back taxes that you owe, and the like.

Getting a "Satisfied In Full" Reporting

If the collection agency agrees to settle for less than you owe, be sure it also agrees to report the debt it holds as “satisfied in full” to the credit bureaus. Be sure to get written confirmation from the creditor and the collector. The debt collector’s confirmation should say that it will acknowledge the debt as paid in full when you pay the agreed amount. If the creditor (or the debt collector if it has the authority) agrees to delete the original account line, get confirmation that it will submit a Universal Data Form to the three major credit reporting agencies deleting the account/trade line. If the debt collector does not have authority to act for the original creditor to delete the account information on the original debt, you may need to write separate letters to the creditor and the debt collector.

(For information on the three major credit reporting agencies, see Rebuilding Credit FAQ.)

sample letter to remove old debt from credit report

Dispute Validate Remove Delete Errors. Debt validation, credit dispute, identity theft, negotiate, settle for less, cease and desist, motion to vacate.

Free universal credit dispute form

For people who have errors or unfamiliar items on their credit report. Find hard to find creditors and accounts fast. Negotiate and validate any unfamiliar debts. Follow up on credit agreements from negotiations.

Debt validation letter for second and third party collections---

Validation Follow up Letter

Use this letter to follow up on a collection agencies improper or incomplete response to the Debt Validation letter above. Agencies are required by law to have the legal documentation to collect or they must cease all collection efforts by law.

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Customize your own negotiation letter

Negotiate with creditors letter

Individualized each letter to meet each creditors or collections agencies situation. Remember it is best to negotiate with original creditors before collection agencies. Original creditors have the authority to get credit removed or updated all the way down to the collection agency they assigned to my bad credit account.

Use this letter to put a freeze for fraud lost or stolen

Free universal credit fraud theft alert or hold

Letter is used to put an alert and a credit report that has strange things showing up that are not mine. If you think someone might have your personal information, if you are going through a separation and want to make sure no new credit is opened without your permission, or is you have been the victim of any type of credit fraud, then use this letter.

Use these letters to open new good credit

Open new good revolving credit

Designed to establish new good credit to overlap old bad credit. Remember anyone who wants a "HAS TO HAVE" at least 3 open and rated (at least 1 year open and reported to a bureau) accounts to have a good credit score. I might have paid ALL of my debts, loans, credit cards and bills but if I am not actively using new good credit my score will be completely gone in 2 years.

Direct credit reference letter

File a complaint with the FTC here

File a complaint with your state attorney general.

Do this if my debt has been sold and validation letters are getting a bunch of mumbo jumbo but no real documented evidence with my signature