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Question By
dbryce93

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Finally have a stable job, would like to pay off my charged off accounts.
Long story short, I went crazy with cards when I was 18. Used them to pay for rent, groceries, etc when money was tight. Lost my job, had to move back in with my parents, and my accounts went into charge off. Three years later, I'm finally going into a stable career (and mature...), and I really really want to get my score on point so I can get a home in a few years.

So here are my questions:

How do I go about finding out where I can send the money to these charge offs? Do I ask to do a pay for deletion thing?

What's the difference between charge off / closed as derogatory? I have 5 derogatorys on my account and not sure what they are/how to go about taking care of them.

Lastly, there's an account on the closed as derogatory page that says the balance I owe is $0. I have been paying cards off here and there, and this was one of them for $300. Why is this on there still if I paid it off?

I owe $3k in student loans (Those are not due yet, but I'm making monthly payments) and about $1400 in collections that I was going to pay off with income tax. Just not sure how to proceed, and I have no one in my life to guide me with this issue.

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Top Contributor
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First get copies of all 3 credit reports

Then go through each one and see what is actually past due and payable, What has been charged off (means that they are no longer trying to collect.  and what has been turned over to collections. 

if the debts are less than 5 years old start paying them off one by one.  Start with the smallest amount and work your way up the list,  When paying them off, its best to contact the lender by phone and get them to agree to remove the derogs as a "Pay to delete". you might be able to negotiate an lower pay off at thie same time. Once they agree tell them you need to have them send you the agreement in writting before giving them the money.

If accounts have been "written off" meaning they are no longer trying collect, Be aware that they will probably file a 1099 with the IRS and you will have to pay income tax on the amount that you owed but did not pay.  It is considered unearned income.  Pay the taxes when the IRS contacts you. You don't want a tax lein on your credit report.

good luck

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