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How to Remove Collectors From Your Credit Report
My client had received an elective medical procedure several years ago, then went through a divorce and fell behind on the payments. The debt was purchased by a debt collector who began reporting it onto all 3 of her credit reports. The amount they were trying to collect was different from what she thought she owed, however she had been unsuccessful in obtaining any documentation from the collector which would have explained where the extra fees were coming from, whom they would be paid to, or why they were there. She wasn’t comfortable paying an unknown company under these circumstances and requested that I figure out what was going on with this account before she agreed to anything.
I filed a dispute with the big three credit bureaus to initiate the dispute process and to have the bureaus perform their investigation. When they concluded (by verifying the debt with the collector) that the debt was verified, I sent a request for validation of the debt to the collector. We did not receive what we believed to be validation of this debt, or any accounting of the additional fees. Because she wanted the fastest possible solution to deleting this account off of her credit report, I created an offer for my client of approximately 11 cents per dollar in exchange for a full trade line deletion of this account, which was accepted by the collector without further negotiation.
Why I won
Although she could have filed a complaint with the CFPB because she never received proper debt validation from the collector, my client elected to have me proceed with a settlement offer instead as this method would produce faster results, and she could afford it.
This is a prime example of a collections company willing to settle a debt for pennies on the dollar in order to ensure a fast collection (many debt collectors follow the “a bird in the hand is worth two in the bush” principle). I was able to negotiate a deal for my client from this collection company to pay $420 dollars to completely settle almost $3,700 dollars in debt. That comes out to about 11 cents per dollar.
Also note on the letter that the collector clearly states he will be deleting the information from my client’s credit reports (I required this condition as part of our payoff arrangement).
The collector accepted this initial offer because he knew that my client was aware of and would be defending her rights, and that if they didn’t collect immediately their profit potential for this particular account would likely fall even further. I ensured that the collector was aware of the fact that my client was a hard target by following a proper dispute protocol with thorough documentation of all of the paperwork sent by the collector, who may have also violated HIPAA.