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Need advice on a collection account that was not my fault
I never had been late or missed any payments in any of my credit card accounts, and I have stayed below 19% credit utilization for the past 7 years. A few months ago, I received a medical bill from one of the anesthiologists for my c-section for only $130. My insurance was supposed to cover that, so I forwarded the bill to my insurance and they said that I can disregard the bill. A few months have passed, the same problem happened. I kept receiving the same bill and I followed up with my insurance asking my the bill is still unpaid. They kept saying that it's already within the system and that they are still processing it. They told me not to pay for it, so I didn't. That was the biggest mistake I did. I should have not listened to them because a few weeks later, I received a collections notice on that same bill. I immediately called the collection company telling them that this was a mistake. My insurance company specifically told me not to pay for it because they said they were already in the processing of releasing the payment. I asked if there is still a way to correct that record and if I will pay for it myself. She said she can remove the record immediately with no problem. I paid off the $130 and she said she removed the record already. This collection account has caused my credit score to drop 76 points from 691 to 615. It has been several months now since that debt has been paid, but it still shows in the credit report and my credit score has not moved despite the payment and paying off my other credit cards on time. Is this worth disputing? I have been taking good care of my credit score and a stupid mistake for only $130 has caused me so much. I am currently applying for DoD secret clearance and I'm afraid that this thing will affect my eligibility. Any advice would be greatly appreciated.

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All negative items on your credit report that is inaccurrate is worth disputing. First I would get the payment records from your insurance company, also find out why they didn't pay the amount in question. If they were supposed to pay it, and you did; they owe you some money back. Next I would get a copy of what you paid to the collections agency. Next time you should negotiate a "pay for delete". This is when a collection agency agrees to accept your total payment and remove the collection from your credit completely. It's like you never had a collection at all. Try to see if you can stil get them to remove it from your file. Legally they don't have to, but if you cooperated like you said you did, they shouldn't have a problem with granting you a small favor, you may have to speak to the supervisor.... The last step is to try to write a dispute letter to the credit bureaus with the proof of payments you obtained and ask it they will remove it from your file. 9 times out of 10 the info will be accurate though because you agreed to pay the bill.  Good luck my friend. Congrats on the new addition!!!

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