Credit Repair Program -- Step 5. Charge-offs and Late Payments
Now that you've disputed inaccurate information on your credit report, it's time to deal with negative, but true information. Despite what the three credit bureaus and the FTC tell you -- "that you cannot get true information removed from your credit report" -- you actually can get charge-offs and late payments removed in many circumstances. How? By contacting the creditor directly and asking them to remove or alter the information. Some creditors will refuse outright, others will comply if you say "please", and still others will comply only if you agree to do something in exchange, such as pay them what you owe or pay them less than what you owe as a settlement.
Will creditors help you improve your credit rating? It depends on what is on your credit reports. If you have an extensive history of late payments and charge-offs, they probably won't help you out. However, if you have an overall good credit rating, but have a charge-off or a series of late payments that occurred during a brief period of time when you were ill or unemployed, many creditors will agree to remove the negative information.
Sample letters you can use to contact your creditor are provided (See Sample Letters 5, 6 and 9). After sending your creditors letters requesting they change or delete negative information in your credit report, give them at least 30 days to respond to your request. If you do manage to get a creditor to accept payment in exchange for removal of negative information, be sure you get a signed and dated agreement before sending in payment.
Note that your creditors are in no way obligated to remove accurate information from your credit report. In fact, as stated earlier, some of them will not remove it no matter how nicely you ask or even if you offer them payment. However, don't give up too easily. Just because one credit manager refuses, doesn't mean another one will, too. Call back three or four more times over a two month period and ask to speak to a supervisor. Perhaps you can get someone to agree to remove the negative information. Note that you will get better results if you are polite, professional and respectful. Threats, insults and tirades don't work.
What if you can't get late payments and charge-offs removed? Let time take care of it for you. Paying all of your debts as agreed for just one year will tremendously improve your credit rating.
The following are true success stories:
- John had an excellent credit rating until he was unexpectedly fired from his job. He fell behind on his debts for three months The late payment notations on his credit report severely damaged his credit rating. John wrote a letter to each credit card company asking them to remove the late payment notations because they were affecting his ability to find a job and thus, pay his debt. All credit card companies complied and deleted the negative notations. John's excellent credit rating was restored.
- Susan's credit report states that a $987 debt she owed Acme was charged off in 1999 and is keeping her from getting a home loan. She gets Acme to agree in writing to delete the charge-off notation on her credit report in exchange for a $500 payment.
- Bill, who has a perfect credit rating, forgot to send in his car payment on time one month. He incurred a late fee and a late payment notation on his credit report. But since he was a good customer and had always paid on time, the creditor agreed to reverse the fee and remove the notation.