Expert: Apex Credit Services, LLC - 5/15/2008

Question
Hello.  I have a question regarding paying off bills that have entered collections.  I have a variety of bills.  To name a few a JC PENNEY credit card, Walmart card, Gordon's Jeweler's Card, 2 HSBC cards, as well as some old Verizon Accounts.  Each of these accounts in at least 1 yr past due and have entered collections.  I noticed that the all of these past accounts are "Closed Status" on my credit report.  My parents are floating me a loan to help get my finances back on track.  What would the best method be to get my credit back on track?  I was going to contact all of these collectors and either negotiate either full payment or a settlement.  Would these paid accounts even be reflected on my credit report considering they had already went to collections?  Is there any way to negotitate a different status e.g. instead of closed account--changed to something of a more positive light Account paid in full -closed.  Something like that. My previous score was a 770 and then I ran into financial hardship my current credit score is currently a 500.  Any suggestions would be great!  Thank you for your time.

Answer
Jimi:

   We will answer your questions in the order you presented them:

   1)  The best method of going about these is to first see if any of the account tradelines can be deleted from your credit reports.  You may challenge any inaccuracy or data field which is incomplete by contacting the credit reporting agencies.

   Thereafter, see which accounts remain.  Then, attempt to achieve a pay for deletion or even better, "pays as agreed."  This has become a thing of the past so to speak but, it never hurts to ask.

   If you cannot achieve this, just settle the accounts.  The most important thing is for the accounts in question to reflect a zero balance and a current account history.  Unfortunately, these accounts are new enough that you really have to pay them or delete them in order for your scores to rise.  If you leave them unpaid, they'll report as an unpaid charge-off virtually every month thus, lowering your scores.

   2) The original creditor lines should already be present plus, probably any collection agency assigned to the account.  They probably reflect as a charge off unless they've been sold to a third party debt purchaser.  Be careful of going about payment.  That is to say, make sure the account is owned by the original creditor.  Do not pay a debt purchaser.

   If they are still owned by the creditor and you cannot delete the line and have to pay then, yes, thereafter it will report as "paid."  While not great, it is better than an unpaid charge-off.  However, you may be able to get some or most deleted after payment.

   Finally, we may be able to assist if you're at all interested.

             Apex Credit Services, LLC
             http://www.apexcreditservices.com
             1-888-727-4818