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Question By
zbee

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how to remove charge offs being bought and sold
collection agencies bringing my score down by constantly selling my charge off accounts. I don't know what to do?

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It's not the Collection Agencies

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Your charge-off's are being passed around like an Old Maid Card.  This can actually go on for 10 years, 15 years, maybe even longer.  However, it's not the buying and selling of your debt that's affecting your credit score.  It's the bad debt itself.

There is good news.  You are protected by the statute of limitations which gives creditors and collection agencies a certain amount of time to collect a debt.  It varies by state, but it's generally 4-6 years from the time the charge-off was placed on your credit report.  Once a bad debt reaches 7 years old, it must, by law, be permanately removed from your credit report.

Despite the fact the bad debt gets removed from your credit report, it does not prevent it from still being sold and bought by collection agencies.  The bad news is that this can go on forever.  Even though the statute of limitations has passed, you still owe the debt, and they can still try to collect.  The difference is, they cannot threaten you or take any type of legal action to collect the debt.

If you're debt has not yet reached the statute of limitations, you need to be careful here.  A collection agency can manipulate you into starting the 7-year clock all over again.  This is usually done by getting you to admit to the debt, or by submitting any type of payment.  So, if you enter some sort of payment plan and send in even a single dollar, your 7-year statute of limitations clock starts all over again.

On the other hand, if you're passed the statute of limitations, it's still worth while for a collection agency to continue to pursue you.  Odds are, they have purchased your debt as part of a very large portfolio for mere pennies on the dollar.  So, even if they can get you into paying something, it's pretty much all profit.  This is why they always seem to offer you some "Deal" like 50% off your debt for the next 14 days.  It's all profit.

As far as your credit report is concerned, the older the charge-off's get, the less they affect your credit score.  This will hold more true if you are able to obtain positive credit in the interm.  If your charge-off's are fresh, you can work with your original creditor (not the collection agencies).  You can negotiate some sort of payment plan in exchange for positive updates to your credit report.  Remember, after a debt is charged-off, the creditor views it as dead.  If you explain that you are working to address your past debts, many creditors would be happy to recover anything on a debt they considered dead in exchange for those updates.  You can even negotiate having the charge-off removed once you have successfully paid the bad debt.

Otherwise, the only other thing you can do is to dodge the collectors, admit nothing,  and wait for the statute of limitations to kick in.

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