I know this dead horse has been beaten plenty of times, but as stated in my only prior post I am just beginning my investor career. I am finally in a place where Ive been paying all bills on time for 4+ years, my wife and I have decent income and we are saving on a regular basis and keeping our expenses well within a reasonable area. The only problem - old collection accounts on my report, and my wifes income is stead but part time. Because my score was 616 I couldnt be on the loan it would have to be her alone, Im fairly confident we will be denied, even though I know we can afford what we are looking for. My debts are old but they still hurt me so I've been researching credit repair. What does anyone know about Pay for Delete (PFD) letters or other avenues to not restore this debt but find a way to satisfy it sooner without extending the time it lingers on my account. I want to pay the debt now but I'm afraid this will only cause me more suffering.
Sorry for the long story but I need some guidance here.
I would contact the old debts one at a time as you save up some money and negotiate a settlement in full. It will take some time. You don't need a 'credit repair' company to do this or pay for delete. Get the settlement amount in writing before you send money and don't allow them access to your checking acct. The older the debt, the more you can negotiate away. Good luck @Josh Tonecha
I agree with Steve...don't pay any credit repair agency a dime which you can do yourself. I was in your shoes years ago, get them paid and your credit will improved. There is no magical repair tactics to fix your credit over night. It took me several years to repair my credit doing it myself. Start contacting them and paying them off one by one and your credit will improve. Make sure you get it in writing that the debt was paid in full.
thanks @Steve Vaughan and @Sergio Garcia . But a lot of precious advice I received stated that it is financially unwise to just simply pay them because the account goes back to a brand new 7 year clock out of my 5 accounts in negative I have 2 accounts 6 yr 6 month (both must be removed by law by August this year) , and 3 accounts that are 4+ years, Is it wise to renew this debt when they can no longer legally collect without first getting an agreement that they would stop reporting.
@Josh Tonecha definitely try to get them to report it as paid. A new 'satisfied' post on your credit I would think would be way better than an old bad debt they can wake up anytime with fresh bad reporting.
I would like to weigh in on this and offer some advice on Credit Repair as I own and operate a legitimate credit repair company. I agree that there are a lot of credit repair scammers out there but what separates the scammers from the legitimate credit repair companies are two vital elements.
1) Do they have a merchant account?
Most scammers don't have a merchant account and require for you to pay them via a "wire" or a check into their bank account. This way of paying for credit repair is not safe and more than likely you will not get any successful credit repair results because there is no recourse. Only pay for credit repair via a credit or debit card which gives you the protection of doing a chargeback if the services are not rendered.
2) Can they provide video before and after examples of their work?
If a credit repair company cannot provide a video (or videos) of their work then it's hearsay at best. Most of the credit repair scammers will provide a jpg image of the dispute results from the credit bureaus but that can be photoshopped...a video cannot be photoshopped. In this day in age there's no excuse why a legitimate credit repair company cannot provide a "before & after" video of their work.
Most of the credit repair scammers online will promise or guarantee to fix your credit in 30 days and offer to do so at a very low cost (around $300-$400) which is a very sneaky tactic because most ppl will look at $300-$400 as a lost that will not set them back financially...so they prey on the 30 days and the low price point. However, never ever pay for credit repair unless it's through a merchant account.
I disagree with both Steve and Sergio and agree with Kenneth. In Steve's testimonials he admits it will take years. I also own a credit repair company which is located here in Western Pennsylvania. The criteria used to select who to work with should contain working with a reputable company. Just because they have a merchant account does not totally satisfy that criteria.
The pay per deletion model is a losing proposition for both you and the credit repair company. If you have many items the will not dispute them all (since they can not trust you will pay if they successfully remove many of them). If you have a few items, they must make their money somewhere so they overcharge set up and consultation fees. Many credit repair companies who started out under pay per deletion have converted to monthly billing but no successful company has done the other transition.
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Yea me and my wife were pre approved anyways, so I'm Doing good enough anyways, plus I did my research and know that mostly any credit repair business at best does things you can do yourself and at worst will make things worse or just cost you a bunch of money that you didn't need to spend. Thanks @Steve Vaughan and @Sergio Garcia For legitimate concern and not sales pitches
Steve, Why the hostility? Sorry, it was Sergio who said years. You said it will take some time. The thousands of folks I have helped and the federal government, attorney general etc... would disagree with you assessment of no 'credit repair'. Also you can drill your own tooth but most folks go to a professional (dentist) since their teeth are very important. Our credit reports are only important once we need them to obtain loans but it determines where we live, what type of car, who we work for etc... Finally, how would you explain CROA
Credit Repair Organizations Act | Federal Trade Commission if there is no such thing as credit repair?
Josh, I am not pitching you or anyone. My initial and this response is based in education. Your legitimate concern was pay per delete and the results of paying off collections and charge offs. It is a mute point for now based upon your pre-approval. If your pre-approval turns out to be a denial later on because you have collections and charge offs then you would be best off to turn to a credit repair company. I hope I am wrong and they your loan officer doesn't say "we can't have over 2K of non-medical collections on your credit report". My advice would be to ask your loan officer now what the tollerance of collections and charge offs is; based upon the type of program you are approved for (FHA, Fannie, Freddie etc.). Once you pay for your appraisal you will not be able to re-coup that investment.
Aside from correcting mis-reported infomation on our credit reports, "credit repair" is a myth. I'm not going to argue with you or your industry, or even argue that my credit score determines where I work, where I live or what I drive. It has determined none of those things.
I apologize for my personal attack. That was uncalled for. If you play on your non-investor side of the BP playground, I'll play on mine.
Josh, I was in your situation a few years ago. I had trouble refinancing because of a low Fico score. The first thing I did to improve my score was to get a copy of my report from Annualcreditreport.com. I then disputed anything that was derogatory, even if it was a legitimate balance or statement. The creditors had 30 days to provide information to the credit bureaus in order to substantiate the negative items I had disputed. 2 items were removed from my report, one that was legit and one that had been paid off years before.
I Knew that I had to also change some bad behaviors on my part. So, I signed up for credit monitoring, followed all of the advice, paid all of my bills on time, and waited. It took around 2 years to get a fair to good score. I still use credit monitoring today to help make sure that there are no new surprises to my credit report.
If all of the negative items on your report are over 5 years old, I am not sure that I would pay them off unless a lender required you to do so. While having an account paid in full will improve your score, You will probably need up to 2 years of good behaviors to get your score where you want it anyway. Those items will fall off at 7 years. Pay off anything that is less than 5 years old.
Good luck on your progress!
@Ken Gurta thanks brother, I had basically been doing the same thing over the past three years but I still had those few that weren't going away one of which I had actually paid. But I think your right it had gotten to the point where the new good is outweighing the old bad and in another 2 years it will be all good.
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