Art Gulle author of "Act Like A Homeowner, Think Like An Investor and "5 Ways To Buy The Right Foreclosure With The Wrong Credit" will host credit repair classes at the Riverdale Center in Riverdale Ga. Falling behind on a bill can be serious
business, particularly if your bill is sent to a collection agency. A bill that
is sent to collections, or is “charged off”, can make it very difficult to
borrow money for essentials such as a home or car. However, there are constructive ways to
approach a charge off that can (over time) reestablish your credit.
A charge off remains on a credit report for
seven years, however after that time federal law requires that credit reporting
agencies (Experian, TransUnion, and Equifax) must remove these items from your
credit report. The Fair Credit Reporting Act (FCRA) protects consumers,
creditors, and credit reporting agencies
When it comes to dealing with bill
collectors, it is important to remember that each state has a different statute
of limitations when it comes to how long an agency can take legal action to
collect a debt. Typically this time period is not more than five years, however
you can check with your states Office of the State Attorney General. After this
statute of limitations has expired, a collection agency can no longer chase you down
for that debt.
Certainly, these first two options point to
steps you can take if you are unable to pay your bill. This begs the question,
when is it a good idea to pay a debt?
Becky House of American Financial Solutions says that there is a lot to
think about when it comes to paying old debts.
The first thing to consider is that paying
old debts, even after they have been written off, can bolster your credibility with lenders. Paying these old bills can increase your credit,
making it easier for you to purchase a home or car should you need to. However, it is important to note that paying
on old debts will not erase the old debt from your credit report or necessarily
boost your score. Luckily, Rod Griffin who is the Director of Public Education
with Experian reminds us that your actual credit score is not everything. Doing
everything you can to bolster your credibility with lenders is critical as they
are looking for a complete financial picture of who you are.
Even if you’re not thinking of applying for a
loan, improving your credit score can help you in many other ways. Professional
property management companies look at credit scores when considering whether or
not they want to lease to you. After all, a lease is just a different type of
loan. There are also some employers who consider credit score when going
through the screening process as a way to determine how reliable you will be as
an employee.
There are certainly options when it comes to
paying off charged off debts. Speaking with a credit repair counselor use to be your best option. However, the smarter choice is to stop the cycle and the long drawn out monthly fee and learn what the credit repair counselors may not tell you. "The Credit Journey" credit repair classes will give
you a better idea of what may be in your best interest to pay off the debt, settle
with a collection company for a lesser amount. or start an aggressive dispute process. For more information go to: http://www.TheCreditJourney.com
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