Those with debt understand what a drain it can become and how easy it is to think debt settlement and credit clean up schemes will rid them of the problem. Whilst they are times when these types of services can be beneficial, more often than not they are no more than a costly exercise for both your credit score and budget.
There is no such thing as a quick fix to rid you of your debt; it will take time, knowledge and diligence. For those who have been told different they are either going to be sold what they believe to be a solution when in fact it is not. One such thing is to use “Pay to Delete.”
What is Pay to Delete?
The idea behind Pay to delete is once you have a delinquent account that has been logged with a collections agency this is automatically placed on your credit report and stays there for years. Even if you contact the agency and pay the debt it is not removed from your credit report. Whilst this seems unfair when you have paid a debt for it to still have an effect on your credit, it needs to stay on your record so that potential lenders can obtain a complete picture of your credit history therefore regardless of whether you have paid the debt because it went as far as a collections agency this will leave a black mark against your future credit.
This is where pay to delete can raise itself. In principal the idea is that you agree to pay off what is due and ask the credit agency to request that the credit reporting bureau removes the information. Great in theory, but this goes completely against the policies upheld by credit bureaus.
Does Pay to Delete Work?
Pay to delete rarely works regardless of how tempting it may sound, if you search the internet for “Pay to delete” you will immediately be offered templates for sample letters that you can send to the collections agency. It is better to phone them, all they are interested in is recovering as much money as possible, taking the time to write a letter can come across as desperate and some will take advantage of this type of psychology. Some agents may resort to dishonest tactics to get you to pay quicker and you could end up in a pay to delete agreement when the agents have no intentions of upholding their end of the bargain, just remember whatever is agreed you need in writing.
If you manage to reach this type of agreement the agency will try and dispute the debt with the credit bureau in the hope that it will get removed. As the credit bureau forbids pay to delete in practice there is a slim chance that this may work.
Pay to delete alternatives
Pay to delete is not illegal it is uncommon, but if this is your chosen method and it doesn’t work there are alternatives to repair your credit score, although these are not as quick.
Fixing your credit report when it is showing an error
When you check your credit report and find a debt you do not owe, do not use pay to delete under any circumstances. You should not pay a debt that is not yours, when it is uncovered you need to contact the credit bureau and open a dispute. Should the error be more fraudulent you must dispute and also set up a fraud alert as this will stop any further credit being obtained in your name.
Fixing your credit score when the delinquent item is valid
If you owe the debt pay it off as soon as possible. Although this may not be easy there are options:
– Arrange with the collections agency to pay affordable amounts off over a period of time.
When the debt is paid it may be worth asking them when the debt is paid to stop reporting it or to request that past entries are removed, however just as pay to delete this will probably not work but worth a try.
There are a number of factors that determine your credit score meaning there are other ways to improve this, even when you are paying off debts.
The perfect credit score
Perfect credit scores do not exist and everyone has more than one. Whilst there is nothing you can do to obtain a perfect score you can try to achieve the best score possible by:
- Paying all bills on time.
- If you are experiencing problems call the lender and work out a payment plan, this will stop any further negatives being added to your score.
When it comes to improving your finances slow and steady should be your mantra as there really is no quick fix.