A Pay for Deletion settlement is an agreement with a collection agency or creditor to remove an account(s) from a consumer's credit report once the account has been paidor settled as agreed. If you've already attempted credit repair or are just looking to be more aggressive in removing negative accounts from your credit profile, the Pay For Deletion method may be a great option.
However, prior to making the decision to pursue this method...
Here are 5 Things to Keep in Mind about Pay for Delete:
1. The Goal You want to keep in mind that the goal is to get the account removed from your credit profile, NOT just satisfying the debt. Remember to the request the actual removal of the account during negotiation.
Get everything in writing, and from all parties involved. This is for accurate record-keeping. Doing so will help you hold creditors accountable and provide proof of the agreed-upon arrangement should the account reappear in the future.
3. Amount It's important to remember that Pay for Deletion is a negotiation, meaning, you contribute to the final decision. When negotiating a payment option, you generally want to start at about 25-30% of the total amount owed. Creditors sometimes reply with counter offers, regardless, you have the right to negotiate an updated offer.
4. Time Similar to credit bureau disputes, you will want to give creditors about 30 days to reply to your offer. Contingent on a new or updated agreement, the negotiation process can be executed within 3 attempts.
5. No Guarantees Pay for Deletion is not a solve-all method or instant solution, however, the method can be effective in cases of unpaid debt (excluding student loans, child support, or any other government-issued debts). With this being stated, it's important to understand that a creditor may deny your negotiation attempts. Again, Pay for Deletion is a viable alternative for removing negative accounts from your credit profile; it is NOT a guarantee.