Confused about my debt and how to resolve it

[Anonymous]

In 2011, I had a credit card through Wells Fargo go into collections. Long story short, I lost my sister and left my job due to my mental state, so I had no money to pay my credit card bill (yes, my fault). Collection agencies (I think I remember one called Viking?) started harrassing me but I just didnt' have the money to pay the debt down. After finding a new job, I contacted Wells Fargo to try to start paying down my debt. The woman on the phone laughed at me and told me, "Oh no we washed our hands of that debt a long time ago, you'll have to get in contact with the collection agency." After that, I stopped receiving phone calls and letters in the mail.

Cut to today; I received a letter from Wells Fargo asking me to settle the debt for 50% of the original due balance. My experian credit report still shows the account as closed and a charge off.

What's going on and what would be my best course of action to take to resolve this? My goal is eliminate this debt and raise my credit score.

[RobertEG]

When an account reaches a certain level of delinquency, which is 180 days late for a credit card, the creditor does a charge-off for accounting purposes.

However, the taking of a charge-off does not excuse the consumer from continued obligation for the entire debt.

Many creditors will then either assign the bad debt to a debt collector for continued attempts at its collection, or they can sell the debt to the debt collector, and receive only pennies on the dollar.  If they sell the debt, then they must update their credit reporting to show $0 balance, and they therafter can no longer accept payment of the debt.

Any payment would go to the new owner.

Your first call indicated they had sold the debt, and thus were through with it.  However, if they are now willing to accept payment, that indicates that they never sold the debt, and that the debt collector only had assigned collection authority.

Paying the debt will not remove the reported charge-off, which is a major derog, and will continue to affect scoring until it ultimately reaches its statutory credit report exclusion date, which is no later than 7 years plus 180 days from the date you first became delinquent on the account (DOFD). 

The usual procedure for getting the charge-off deleted, and thus removing it from adverse scoring, is to offer the creditor a pay for deletion (PFD), where you offer to pay the debt in exchange for their agreement to delete the reported derogs on their account.

[Anonymous]

I would think you need to do a couple of things before you can really start a roadmap to higher scores. You need to figure out the date of first delinquicy. The date when the account first became past due. Your hard copy reports (not monitoring service versions) should show that. You can get an official copy on the annual credit report website for all 3. Once you establish that, you will know the date that this debt will age off of your reports. It will aslo help you establish when the statute of limitations runs out. Statute of limitations is basically how long they have to sue you, obtsain a judgement against you over the past due debt. Then, you need to figure out who currently owns that debt, if Wells Fargo has charged it off then sold it to a junk debt buyer or if they have contracted a collection agency to pursue collections from you.

Once you establish a starting point, then you can start a strategy towards either trying to pay and get this delted either by a pay for delete, or possibly by getting a Good Will deletion. If you just simply pay it, all that happens is your credit reports will be updated as paid. The negative still exists on your report and can cause a ding on your score. However, if a credit underwriter does a manual review, seeing that you did take responsibility and pay the past due debt can be viewed favorably.

ideally, you want the negative mark deleted. There are different methods to attempt in order to do that, which can you can search here for or ask questions. But, get yourself a starting point where you know more specifics of this debt. That will help you decide what strategy is necessary to pursue.

[Anonymous]

Thank you! So a pay for deletion would be my only option to remove the derogatory mark from my credit report? Will that also remove my bad payment history?

[Anonymous]

---

@Anonymous wrote:

I would think you need to do a couple of things before you can really start a roadmap to higher scores. You need to figure out the date of first delinquicy. The date when the account first became past due. Your hard copy reports (not monitoring service versions) should show that. You can get an official copy on the annual credit report website for all 3. Once you establish that, you will know the date that this debt will age off of your reports. It will aslo help you establish when the statute of limitations runs out. Statute of limitations is basically how long they have to sue you, obtsain a judgement against you over the past due debt. Then, you need to figure out who currently owns that debt, if Wells Fargo has charged it off then sold it to a junk debt buyer or if they have contracted a collection agency to pursue collections from you.

Once you establish a starting point, then you can start a strategy towards either trying to pay and get this delted either by a pay for delete, or possibly by getting a Good Will deletion. If you just simply pay it, all that happens is your credit reports will be updated as paid. The negative still exists on your report and can cause a ding on your score. However, if a credit underwriter does a manual review, seeing that you did take responsibility and pay the past due debt can be viewed favorably.

ideally, you want the negative mark deleted. There are different methods to attempt in order to do that, which can you can search here for or ask questions. But, get yourself a starting point where you know more specifics of this debt. That will help you decide what strategy is necessary to pursue.

---

August 2011 was when the account became past due.

[Anonymous]

So, your age off date is going to basically be August 2018. As a collection account gets older it has less affect on your score, but any new lender seeing it on your report may not be too happy seeing it.

You have possible options for getting it deleted. If there is some type of error, if whoever owns the debt cant validate that it is truly owed to them, you can file disputes and get it removed. If it is a valid debt and they can prove so, then you're looking at either negotiating a pay for delete or paying it in full and seeking a good will gesture on their part to delete it for you having paid it off.

You can find sample letters here and else where for PFD and GW situations. Your success in those manners depends a lot on who owns the debt. Some are more willing than others to negotiate such things with. Pull your reports, pour over them and see if everything is factual. If it is, and you can't find reason to dispute, then it's time to move forward with a different strategy.

[Anonymous]

---

@Anonymous wrote:

So, your age off date is going to basically be August 2018. As a collection account gets older it has less affect on your score, but any new lender seeing it on your report may not be too happy seeing it.

You have possible options for getting it deleted. If there is some type of error, if whoever owns the debt cant validate that it is truly owed to them, you can file disputes and get it removed. If it is a valid debt and they can prove so, then you're looking at either negotiating a pay for delete or paying it in full and seeking a good will gesture on their part to delete it for you having paid it off.

You can find sample letters here and else where for PFD and GW situations. Your success in those manners depends a lot on who owns the debt. Some are more willing than others to negotiate such things with. Pull your reports, pour over them and see if everything is factual. If it is, and you can't find reason to dispute, then it's time to move forward with a different strategy.

---

How would I innitiate something like a PFD or a GW? Would I just call them up and try to negociate over the phone? Thanks for all the answers so far.

[Anonymous]

Theres different thoughts on that. Some say a verbal agreement is as enforceable as a written agreement. Others believe written is the way to go. I agree with that thought but I was recently able to do a PFD over the phone on a medical collection. Medical collections, at least from my belief, are easier to get a PFD on. I think your best bet is to do a written PFD letter to the OC or CA. It's still imortant though that you validate this debt and who owns it so that you can determine who the PFD letter needs to go.

[Anonymous]

---

@Anonymous wrote:

Theres different thoughts on that. Some say a verbal agreement is as enforceable as a written agreement. Others believe written is the way to go. I agree with that thought but I was recently able to do a PFD over the phone on a medical collection. Medical collections, at least from my belief, are easier to get a PFD on. I think your best bet is to do a written PFD letter to the OC or CA. It's still imortant though that you validate this debt and who owns it so that you can determine who the PFD letter needs to go.

---

I apologize for all the questions, but how wouild I validate the debt and who owns it?

[Anonymous]

---

@Anonymous wrote:

---

@Anonymous wrote:

Theres different thoughts on that. Some say a verbal agreement is as enforceable as a written agreement. Others believe written is the way to go. I agree with that thought but I was recently able to do a PFD over the phone on a medical collection. Medical collections, at least from my belief, are easier to get a PFD on. I think your best bet is to do a written PFD letter to the OC or CA. It's still imortant though that you validate this debt and who owns it so that you can determine who the PFD letter needs to go.

---

I apologize for all the questions, but how wouild I validate the debt and who owns it?

---

How are they listed on your credit reports?