How To Fix A Bad Credit Report

Tips on Removing Charge Offs on Your Credit Report

To put it plainly, charge-offs are bad debts that the original creditor has written off the books of accounts and then subsequently sold to a debt collection agency.  More often than not, the charge-offs have been sold pennies to a dollar although the debt collection agency will still demand payment in full from the debtor.

Fixing credit report

With that being said, what is the effect of a charge-off on your credit report?  Well, it’s bad, actually.  The words “Charge Off” will appear at the beginning of your credit report followed by the amount still owing on the debt, which means that your credit score will take a beating for the worse.  And you should know by now about the consequences of a low credit score in your life.

Fortunately, you can have a charge-off removed from your credit report but it is a difficult process.  If you do not succeed in said removal, then we recommend trying to lessen its impact on your credit report.

Credit Card Debt Settlement

First on the list is to settle your debts.  By this, we mean not fully paying your debts with the original creditor but aiming for a settlement in the range of 30-50 percent of your total debt.  At this point in time, the original creditor is willing to settle for an amount considerably less than the original debt rather than have it sold to a collection agency for less than the 30-50 percent you are offering to pay as debt settlement.

Now, if your debt was sold to a collection agency, you will still go to the original creditor.  This is because only the original creditor can report the charge-off to the credit reporting agencies while the collection agency can do nothing about it.

Continue reading fix bad credit report…