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Original Creditor Closed/Charged-off vs Collection Agency Accounts

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randaljon
Regular Contributor

Original Creditor Closed/Charged-off vs Collection Agency Accounts

Who should I tackle first? Should I try to settle through Validation then PFD with the Collections or do Settlements with the Charged off accounts first?

 

 

I have 4 Original Creditor Charge-off Accounts that I want to attempt to settle with and hopefully delete.

 

I also have 3 collection agencies on my CR Files. 2 of these are from 2 of the 4 Original Creditors above.

 

All from 2008-2009...

 

 

 

 


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LIGHTNIN
Senior Contributor

Re: Original Creditor Closed/Charged-off vs Collection Agency Accounts

What I would do first is find out your states SOL.

Find out who is the biggest treat to you,by that I mean, if you're within the SOL, they can take you to court and win.

 

If some of your debts are Passed SOL,you dont have to worry about them taking you to court.

Also, they are more then likely to, settle for less then the full amount,when passed SOL.

 

Do you have the funds for all 5 of these debts?

FICO's May 2015 EQ764 ~~Live below your means and always keep an emergency fund -Love Everybody ~ Big Kenny ~ Big and Rich ~~~~~Credit Scoring 101 - Common Abbreviations - Freq Req Threads - Free Credit Reports - What Steps Do I Take?DV? PFD?
Message 2 of 3
RobertEG
Legendary Contributor

Re: Original Creditor Closed/Charged-off vs Collection Agency Accounts

I am not sure what you mean by "settle through Validation."  The debt validation process is a debt collection practices process. 

As for a CO vs. a CA, both really have the same issue regarding settlement.  A debt is owed.

If your goal is to get CR deletion of one or the other before their normal 7 1/2 year falloff date, the procedures could be different for each.

The first thing you should determine is who currently owns the debt.  The CO was, obviously, done by the OC.  When the OC then placed the debt for collection, they could have done this in two very different ways.  They could have merely assiged the debt to a debt collector, while retaining ownership of the debt, or they could have sold the debt to the debt collector.

If the debt was assigned for collection but not sold, then you can offer to pay either the OC or the debt collector.  If you gain a PFD acceptance by one or the other, all they can agree to delete is their own prior reporting.  PFD the OC for deletion of the CO, or PFD the debt collector for deletion of the CA.  Your choice.

If the debt was sold to the debt collector, that restricts your options. The OC would not, therafter, be able to accept any payment. So PFD would be retricted only to the debt collector, and their CA reporting.

Getting both deleted then usually involves a PFD to one, and a GW to the other. Both are major derogs.  My opinion is that after an OC does a CO and additionally refers the debt to a debt collector, they are probably less likely to bring future legal action than would a debt collector.  If the debt is still within SOL, I would probably focus on the CA first.

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