Pay for Delete

[Succulent]

Hello,

 

I pulled my report today and found 2 collections accounts. One is medical and the other is from Dish Network. I do believe that both are valid and am willing to pay both in full but I want to have them removed; not just updated to paid in full.

 

I called both collections companies and was told by the first that they are unable to remove it completely. The second company told me that it was actually illegal for them to do so. I asked him if he was sure that was accurate and he told me that is what his managers told him. I asked to speak with one of the managers and they stated that it was against the FCRA to delete it completely even if I paid in full.

 

So, any advice of where to go from here? Did they just lie to me about the legality of removing the collections account from my report? Do I have an recourse if they did? I appreciate any thoughts.

 

Thanks,

 

[Clydesmom]

Some creditors have a stead fast policy against doing PFD.  You cannot force them to.

 

The second company told me that it was actually illegal for them to do so. I asked him if he was sure that was accurate and he told me that is what his managers told him. I asked to speak with one of the managers and they stated that it was against the FCRA to delete it completely even if I paid in full.

 

It isn't illegal but this is a common reason that CAs use to avoid arguing from the consumer.  Most consumers hear illegal and drop it.  Technically it is against the FCRA to delete it.  The FCRA requires they report accurately.  The bureaus prefer they not do PFD.  There is no consumer recourse for this.

[Succulent]

Thanks Clydesmom, That makes a lot of sense.

 

So now I just have to decide if I want to pay it off and have it updated to paid in full or just leave them to fall off. Both of them are not for very much money. However, I've read that it is not always the best idea to have the report updated to show paid in full. Is that true?

 

Thanks,

[Clydesmom]

Thanks Clydesmom, That makes a lot of sense.

 

So now I just have to decide if I want to pay it off and have it updated to paid in full or just leave them to fall off. Both of them are not for very much money. However, I've read that it is not always the best idea to have the report updated to show paid in full. Is that true?

 

Thanks,

 

Whether showing paid is better depends on what you are trying to accomplish.  An open unpaid collection is always worse.

[PayCutHurtMe]

Thanks Clydesmom, That makes a lot of sense.

 

So now I just have to decide if I want to pay it off and have it updated to paid in full or just leave them to fall off. Both of them are not for very much money. However, I've read that it is not always the best idea to have the report updated to show paid in full. Is that true?

 

Thanks,

 

If that's all that stands between you and a mortgage, paid is better. 

[merkurfan]

Some creditors have a stead fast policy against doing PFD.  You cannot force them to.

 

 

It isn't illegal but this is a common reason that CAs use to avoid arguing from the consumer.  Most consumers hear illegal and drop it.  Technically it is against the FCRA to delete it.  The FCRA requires they report accurately.  The bureaus prefer they not do PFD.  There is no consumer recourse for this.

The correct reply is "yes, they require you to report correctly. But they do not require you to report at all"

[WhoCares1000]

True, there is no requirement for anyone to report to your credit report but I am sure there are contracts these companies have with the reporting companies that do not allow deletion in return for their use of the credit reports (the reporting companies can ban third parties from using their services).

As for paying, It used to be that paying on a old debt hurt your credit score. However, Fair Issac finally hired someone who had 2 function brain cells that were connected and they, as well as the banks and JDBs realized that this was stupid and so changed the algorithms so that paying off an account should not hurt your score anymore.

[merkurfan]

True, there is no requirement for anyone to report to your credit report but I am sure there are contracts these companies have with the reporting companies that do not allow deletion in return for their use of the credit reports (the reporting companies can ban third parties from using their services).

As for paying, It used to be that paying on a old debt hurt your credit score. However, Fair Issac finally hired someone who had 2 function brain cells that were connected and they, as well as the banks and JDBs realized that this was stupid and so changed the algorithms so that paying off an account should not hurt your score anymore.

Hello fellow Minnesotan..

I have heard of this approach being used as well. "You agree to not respond to any disputes from the credit reporting agencies" while likely also not in the rules per-say.. opps, we forgot.. sorry.

[WhoCares1000]

That could be a possible avenue but realize if they lie, you really cannot hold them to that contract. The courts would not look favorably on it (your honor, I expect them to not tell the truth when asked as per this contract).

[myscoresawful]

I've only ever had one CA agree to a PFD, and we were both on the honor system with it.  There was no written agreement (although he did tell me to write "paid in full. Delete record" on the subject line of the money order).  They held up their end of the bargain and when I got the confirmation letter from them, it was short and sweet and written something to the effect: "record deleted, 30 day letter not sent".  In other words, they were removing the record as a courtesy because they had failed to send me the initial letter to dispute before assuming it was my debt.