Dealing With Your Creditors

Often you will run across negative remarks that cannot be deleted without creditor cooperation because the dings are accurate and the creditor persistently cooperates with the bureau’s request for verification. Since your goal is repair your credit you will need to persuade your creditors to soften their stance by either toning down or entirely deleting their remarks on your credit report. Here are some different tactics to attempt to persuade the creditor to remove the damaging remarks completely.

Anytime you are dealing with a creditor through correspondence you should always keep good records, create a log and record every phone call and every letter that you send as well as receive. This is to assure your most effective outcome in this situation; accurate record keeping is an essential part of your dealings with the creditor who still gives you bad marks.

After studying all the facts concerning each account and the nature of the credit complaints, write each creditor explaining your version of how the problem came about and give all the relevant details, including full documentation. Perhaps your company went bankrupt suddenly, or you lost your job. Or perhaps you were detained several weeks in a foreign country while on a business trip and therefore unable to pay your accounts on time. Whatever the situation may be you want to aggressively let them know that you are serious, but not pushy. You don’t want them to think that you are trying to be a tough guy, remember they already know that you have tried to dispute the items. This may pose as a flag that you are trying to get out of paying this debt therefore resulting in a write-off.

Never under any circumstance dodge your creditor and try to stay away, because it will not go away until you make it go away. Call the creditor and let them know that you are serious about clearing up your delinquent account but you don’t have the entire amount to pay it. You want to get them on your side and in order to do this you must keep regular contact with them. Be faithful and give them all of your current info as to how to contact you. Even if you know that they already have the  information give it to them again just to let them know you are being sincere; if you have to, call them once every week or so just to “check in.” 

Creditors will send an account to collections that may only be one month late if they cannot get a hold of you. On the other hand, it doesn’t benefit them one bit if they do this so if you call to make some type of arrangement then it is more likely for them to work with you. Creditors are more sympathetic to consumers with real problems.

Try to arrange for a payment plan. Creditors will want the amount owed, but will not refuse to take any partial payment that you send to them. They are in the business to make money so anything is better than nothing. Explain to them your full financial situation (such as how many other bills you have other than theirs and how much money you have available to pay your bills). Creditors are most likely to work with you if you keep them in the light about everything.

Some creditors will offer what is called a settlement; this is when they are willing to forgive a portion of the debt if you are willing to come up with the remaining balance by a certain time. Accounts are usually settled anywhere from 75-90% depending on the duration of time that has elapsed from the time that the account went delinquent. In other words, the older the debt the better settlement rate you can ask for.  Some older accounts will be offered a settlement up to 50%; since a big part of this account is all interest anyway, no one is actually losing. Whatever you decide to come up with as far as diminishing this debt you want to make sure that you keep good correspondence and get any arrangement in writing.  You will also want to make all of your payments by check rather than money order, because checks are easier to track in the event that you may need to come back later to them.

Most important is you get a written commitment from your creditor that they will notify the Credit Bureaus that the account is now in good standing  (see sample letters to use)