     Robert Bielak | Wednesday, December 01, 1999 - 06:30 am 
If you can legitimately purchase the old debt, that would be the most certain method. Beyond that, every creditor is different. I had six or seven collections (thanks to my ex-wife & doctors bills for the kids & utility bills that she never sent me). I negotiated with them & some of them agreed to remove the items completely after receiving payment, and other emphatically said no, the best they could do was report it as paid. I also had an auto repo from 1994 (Ford Credit). It was originally $5400, but had worked it's way up to almost $10k with interest & costs over the past five years. Well, I did all the negotiating that I could. They agreed to settle for for $5k, but would only report it as a PAID REPO. Best I could do short of buying the debt, which probably would be difficult (what do you do, blind call Ford Credit and say "I want to buy this debt, one of your (probably) tens of thousands of old debts)?"
So I was able to cut the debt in half. I had another for a repo mobile home - was $6k, went up to $8k with interest, negotiated for $3500 as settlement, but again, only updated to "PAID was REPO".
Regardless, the idea is to get the item paid. If you don't, it remains a debt, it remains on your credit reports as an outstanding debt and hits your FICO scores hard. I paid off those two major debts, worked the collection accounts (all paid, most removed), and I finished all this about two months ago.
And I just recently received my mortgage approval letter for a brand new, $170k home at the prime lending rate. The debts were old (5 years), but they were paid. The mortgage company ran my reports BEFORE they were paid and I didn't qualify because the outstanding DEBT killed my scores. After paying them off, my scores skyrocketed (700 on one, 660+ on the other two).
Regardless of whether it's listed as a PAID was REPO or if you can get it off, pay the damn thing (negotiate a good deal, but don't expect 20 or 30 cents on the dollar if they know where you are or if they can/are garnishing your wages). In the long run, it's best to have zero balances on any old charge-off/repo/whatever trade lines and collection agency accounts. |
