A charge-off, R-9, is an account reported to the credit bureau that the creditor has written off as a loss. The government provides the business with an opportunity to write off for their loss when a customer doesn't pay. The customer is still responsible for paying the unpaid balance on a charge-off. The charge-off remains on the credit report for seven and half years from last date of activity. It depends on how long the charge-off has been on the credit report that affect the credit scores.
Most people credit report takes a sever hit on their credit score for a charge-off reported on their credit report. Each month the credit scores drop from a late payment. If the account balance is more than $1,000, the lender may request the account to be paid under a FHA loan. If the customer has an old account on their credit report, the scores have been calculated on the old debt. Paying off a credit account to obtain a mortgage may drop the credit score immediately. If a buyer has a credit score of 620, the buyer should pay off the account at the closing table. The credit score will take a drastic hit for paying off an account before final approval.
Timing
Most people credit report takes a sever hit on their credit score for a charge-off reported on their credit report. Each month the credit scores drop from a late payment. If the account balance is more than $1,000, the lender may request the account to be paid under a FHA loan. If the customer has an old account on their credit report, the scores have been calculated on the old debt. Paying off a credit account to obtain a mortgage may drop the credit score immediately. If a buyer has a credit score of 620, the buyer should pay off the account at the closing table. The credit score will take a drastic hit for paying off an account before final approval.
Resolve the Problem
The customer should negotiate with the creditor to pay off the account. Some time the collection agent is annoyingly rude to a customer who is trying to negotiate an account. All agreements should be put in writing before sending a cashier check.
1. Never give a collection agency your personal checking account. They could draw the rest of the money out of your account.
2. Never pay a collection agency until they send in writing the amount to be paid.
3. Request the creditor to delete the account based on pay-for-deletion.
Under the Fair Collection Act, the customer has Federal and State Rights to protect them. The collection agency can't violate a customer rights as they collect their money. If a customer's right has been violated, the collection agency may be suited for the violations.
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3. Request the creditor to delete the account based on pay-for-deletion.
Under the Fair Collection Act, the customer has Federal and State Rights to protect them. The collection agency can't violate a customer rights as they collect their money. If a customer's right has been violated, the collection agency may be suited for the violations.
Consequent of Late Payments
Every late payment drops the customer's credit scores.The late payment stays on the credit report for seven and half years from the last date of activity.
Credit Score
Below 600
All Applicants
with credit scores below 600 may still have the opportunity to purchase an
affordable home. The booklet, "Increase Your Credit Score After Short
Sale, Foreclosure and Bankruptcy", provides the techniques to increase an
applicant's credit scores. The program offers “FREE 30 DAYS COACHING” as well
as the booklet at increaseyourcreditscorenow.com
We
provide monthly newsletters on how to increase an applicant's credit scores and
weekly blogging information at increaseyourcreditscorenow.blogspot.com
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