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Unpaid Collection Accounts

Collection accounts are a tricky part of credit restoration and need to be handled in the best possible way in order to avoid damaging the credit score. Although we can remove a paid collection with better than a 50% success rate, for the collection accounts you have that are unpaid, it is always a good idea to settle unpaid collections for a deletion with payment when possible. It is not always possible to get the collection agency to agree to delete the account with payment, but we have been successful doing so more than 70% of the time. Keep in mind that while the average collection can be settled for around 50% of the current balance, whenever you are requesting that the collection agency also delete the account when you pay it, that collection agency will usually want 100% of what is owed to agree on the deletion aspect. ( you scratch their back, they scratch yours) It is always better to have a collection agency agreeing to delete rather than settle it for a cheap dollar amount and roll the dice afterwards to see if you can get it deleted through other means. This approach is also dependent on how much money you have to pay on these accounts, because if you only have $2000 to spend and you currently want to settle $4000 worth of collections, then you would be better off settling the accounts for 50% with no deletion in order to at least get them satisfied, but if you have the money to spare, I always suggest going for the guaranteed deletion when possible since the credit score is the most important thing ( not saving a few dollars at your score's expense)

Keep in mind that the credit card companies and other big banks DO NOT agree to delete 99% of the time, so it is always best to settle those accounts as cheaply as possible because an account settled for less than the full balance is not much worse than a charge-off that was paid in full, so save the money when you can.


Have us settle your accounts- Although we charge a fee for each account we settle, it is still a good reason to hire us to settle even an $80 collection because that $80 collection can be hurting your credit score by 15 points and getting that account deleted would save you 100 times the fee you paid us. The score is the most important thing, not the amount you are settling for.

Settle them Yourself- If you want to save the money and settle the collection accounts yourself then keep a few things in mind.
  • Always get the agreement from the collection agency in writing
  • Be careful about what you say because they will try and twist it in their favor
  • It is always better to avoid taking a stance on any particular factual scenario because the collection agencies often use it against you
  • Check with your home State to see what the Statute of Limitations is on being sued for a written contractual obligation because collection agencies are usually much more accommodating when they know they can't sue you.

Charge-Off Accounts

What is a Charge-Off? A Charge-off is nothing more than a DESIGNATION given to an account for accounting purposes whenever a creditor thinks it is highly unlikely they will get paid on a delinquent account and want to classify it as a bad debt for tax purposes.

Does That Mean I don't Have to Pay? No, a creditor can still try to collect from you and sue you after they classify the account as a charge-off. The only thing the creditor needs to do is claim the charge-off as income if they do collect on the account.

If I Pay the Charge-Off, Will it Get Deleted? No, it will only get updated as paid or settled if you pay less than the full balance to satisfy it. The account would then get reported as a Paid, or Settled Charge-Off, which is still detrimental to your credit score. When our Clients hire us to remove a charge-off, we challenge the legality of every aspect of the charge-off in order to accomplish getting these accounts deleted in order to help the Credit Score improve. Many times the creditors will report these accounts incorrectly and much longer than legally allowed under Federal Law. You also have to safeguard against flaws in the credit scoring software that will reduce your credit score when you pay the charge-off.

Collection accounts and Charge-off accounts are similar in the ways they are handled. There are only a few variations where they are handled differently. Usually a creditor will charge-off an account and often times sell the account to a collection agency if they feel they have a low chance of collecting on the account. The other approach creditors take is to assign the charged-off account to the collection agency where the collection agency does not own the debt but is collecting the debt on behalf of the original creditor. Often times the collection agency will give the right to collect back to the original creditor if they are unsuccessful in collecting after a certain time period. Knowing these nuances is important when determining which approach to take.
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