How High?

[Anonymous]

Ladies and Gents:

My credit BLOWS and I'm fixing right now.  I have 8 collections/charged off accounts totaled to $50K on my credit report.  I signed up with a debt settlement law firm and in one month time, we've settled 4/8 accounts.  My credit scores went up as listed in my signature on the bottom.

I am aiming to get the remainder 4 derogatory accounts settled within this next two months, once settled, how high will my scores go?  650? 700s?

After all the debt settlements are finished, this law firm will initiate the "credit restoration" process (aka to clean up my credit report).  I'm excited to earn my "financial freedom" back, but I want to see if any of you had similar experiences = collections on your credit report -> settled debt -> credit scores restored?

Please advice and share!

[Anonymous]

There are too many variables to really predict how your score will change.

Are those actual FICO scores gotten from this website that you list?

[clocktick]

How long ago were your charge-offs?  I went through basically what you're going through now.  I have a lot of settled accounts.  I do not think your scores will reach the 700s in the near future, and to be honest, it will probably take years.  Your credit report will still show the charge-offs - paid or not.  Depending on when you defaulted, they will stay on for years.  It was difficult (and still is) getting "good" credit cards. 

You may have better luck than I did depending on SOL and outdated items on your CR.  It's always good to see score improvements though.

[Anonymous]

All of my charge-offs were charged off at least two to three years ago.  I'm very lucky that I didn't get sued!  So even after everything is paid, don't you think the credit restoration program will remove those negative items on the credit report?  I thought they do.

[Anonymous]

Sidewinder:  Those credit scores were directly from the mortgage company credit reports.  That's probably the closest one can get a true score, right?!

[Anonymous]

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IBLeave wrote:

All of my charge-offs were charged off at least two to three years ago.  I'm very lucky that I didn't get sued!  So even after everything is paid, don't you think the credit restoration program will remove those negative items on the credit report?  I thought they do.

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What kind of company are you working with?

What kind of credit restoration program are we speaking of?

How are they planning on removing them?

[ScoreBooster]

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@Anonymous wrote:

How are they planning on removing them?

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An excellent question - especially AFTER you paid them. I'm surprised they are taking the "pay it first, cleaning up later"-approach. If you are paying/settling with these companies, why not working out PFD-agreements right from the start?

Your credit should be a concern BEFORE you actually pay them. Why should they do you a favor after they got what they want?

Just my 2 cents...

Message Edited by ScoreBooster on 01-20-2009 08:59 PM

[CreditAble]

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@ScoreBooster wrote:

 I'm surprised they are taking the "pay it first, cleaning up later"-approach. If you are paying/settling with these companies, why not working out PFD-agreements right from the start?

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Good catch. Notice that the agency is a "law firm". Could it be possible that those lawyers don't believe in using PFD agreements?

Could it be possible that the creditors are being told that "We represent a debtor of yours and will file BK if you don't agree to our debt forgiveness demands?"

Of course the lawyers might have some other legal trick up their sleeves to get legitimate negs removed from the reports. If that is the case I think that it is probably not an action suitable for discussion under the terms of the MyFico Forums.

On the other hand if lawyers do the credit repair (removal of negs), then maybe that would make it legal, (even if not necessarily moral).

I guess the devil is in the details of just how the lawyers propose to have the negs removed. Either way I would caution the OP against having too high of expectations of the "lawyers" delivering what was promised (ie. 700 FICO scores)

Frequently if a creditor is coerced into forgiving debt by a lawyer, it is by using a take half a loaf as opposed to none approach. "Forgive some of the debt or get nothing when I file BK for my clientt."

Of course a person who is supposed to be filing BK soon would not need PFD agreements. The credit history is going to be in the toilet anyway. If a lawyer asked for PFD, the creditor would know that a consumer's credit score is still important to him. Therefore the threat of BK would not be as persuasive.

Demanding that creditors reduce debt obligations by threatening to BK them is a bad idea when a consumer does it on his own behalf.

It is still a bad idea even if a lawyer does it on behalf of a client. The lawyer can keep the client from being sued by using a threat of BK.. I don't think the lawyer can help much with the credit score.