best way to handle this

[fishone4]

I have 2 credit cards that report as Charge offs but still show a balance. $415 and $426. I would like to pay these off with hopes that they will update my reports to a postitive standing. Should I just send payment to them with a nice letter asking for my credit reports to be updated as paid in full or should I pay and then later send a letter asking for deletion. I really want to pay them off and feel better about myself, but if I can get a jump in my score that would be a bonus. Any advise???

[casmith1980]

Couple of things that would be helpful in answering your question:

1.  Who are the original creditors?

2.  What is the DOFD?

[fishone4]

Hsbc Bank 

Date of last activity Aug 2010.

Date closed Nov 2010

Balance Current Status  Past Due Amount 

$426

Charged off as bad debt

$426

First Premier Bank

Date of last activity Aug.2010

 Date closed Nov 2010

Balance  Current Status  Past Due Amount 

$415

Charged off as bad debt

$415

[casmith1980]

---

@fishone4 wrote:

Hsbc Bank 

Date of last activity Aug 2010.

Date closed Nov 2010

Balance Current Status  Past Due Amount 

$426

Charged off as bad debt

$426

First Premier Bank

Date of last activity Aug.2010

 Date closed Nov 2010

Balance  Current Status  Past Due Amount 

$415

Charged off as bad debt

$415

---

Since these are both fairly recent, and from what you've written, it doesn't appear that they have been sold to a collection agency, I would highly suggest sending in full payment.

I'm not sure how HSBC is, but I know first hand that First Premier will not allow a PFD, so I'd stick with paying them in full and then goodwilling the life out of them.

You want to make sure these are paid off IN FULL as soon as possible so they aren't sold to collection agencies and then you have 4 negatives on your report rather than 2

Hope this helps!

[RobertEG]

A charge-off, paid or not, will never be a "positive" in your CR. 

Deletion from your CR is the only way to remove its negative impact on your scoring.

It will drop after 7 years plus 180 days from the DOFD on the OC account should you do nothing, regardless of whether it is paid.  Hence, the prior question as to the DOFD on the OC account.  To get earlier CR deletion, you must convince the credtior to report the deletion of the CO to the CRAs.

The most widely-used way to attempt to pursuade a credtior to delete their prior reporting is to offer to pay the remaiing debt in exchange for their promise to delete the negative reporting.

[casmith1980]

Although a CO is negative regardless if it's paid, wouldn't it be "better" that it's paid rather than the amount looming over the OP?  Sure, you might not reap any score boosts, BUT you can rest easier at night knowing that you don't have any outstanding debts...

Besides - once it's paid in full - you can start the goodwill approach. 

(I worry for the OP that if they were to send a PFD to first premier, and the amount of time since it's deliquency is recent, FP might be inclined to sue OP for the amount plus fees.  Why waste the time on a PFD with FP who is notorious for not accepting when he has the funds to pay in full?)

[annielorie]

I believe you have more negoitiating power when the debt is still unpaid YMMV but if you get the cc company to remove the CO and go to paid as agreed closed get it in writing.  Good luck

[fishone4]

I sent payment in full with a letter today to both HSBC and FIrst Premier. I hope my letter with payment in full works and gets a deletion. If not at least I feel better about myself and they are paid. I stated in my letter that  By accepting this payment in full you agree to immediate deletion of this account from any and all credit reporting agencies (Equifax, Experian and TransUnion). I'm sure they won't send my payment back to me. I got my fingers crossed that in a few weeks these charge off's will be deleted.

[casmith1980]

FWIW, I mailed my check to FP on 3/6/12 (Tuesday) and it cleared by bank by 3/12/12 (Monday)...I'm in Nevada, the payment was sent to South Dakota.  I consider this to be a pretty quick cashing of the check

I'm not sure what state you are in, but you might want to see if restrictive endorsements are valid in your state.  For some reason I want to say they aren't valid in South Dakota (where FP is located)...

[pizzadude]

Yeah restrictive endorsement are tricky ~ not always enforceable, definately check your statue statutes.