Posted on: 11th Feb, 2010 12:27 am
I have several charge offs on my credit report along with a forclosure which all will reach the 7 year max in 2012. I currently carry 4 3major bank cards and one store card. I pay off the balances at the end of the month on the c cards, some times make 2 pmts, a month the other cards carry no bal. and are for emergency use , i use them occasionally to keep them active, but for small purchases. I have heard financial advisors say do not pay on a charged off account, because it will start the 7 yr process over again. is this true? Should I consider getting more store cards to increase my credit debt ration?
Hi mtm,
You should first check the statute of limitation (SOL) in your state, also according to the accounts that have been charged off. SOL is the time period within which the creditor or collection agency (CA) can sue you for not paying the dues. However if the SOL has expired, the creditors and the CA won't be able to sue you any more.
If the SOL has not expires on some accounts, you need to validate those accounts with the CA, because charge off doesn't mean that you need not pay. The CA may sue you for nonpayment. After the validation, if you really find that you owe the debt, then you need to pay the dues. If you are unable to pay the whole amount, you can settle the amount to be paid, with the CA. Along with the settlement request the creditor for a Pay for delete agreement. With the pay for delete your account will be reported as "Paid as settled." However it is better to pay the dues in full. Your credit report will then reflect the item as "Paid in full".
However all the validation, settlement, agreement should be done through certified mail, so that you retain receipt copies.
You should first check the statute of limitation (SOL) in your state, also according to the accounts that have been charged off. SOL is the time period within which the creditor or collection agency (CA) can sue you for not paying the dues. However if the SOL has expired, the creditors and the CA won't be able to sue you any more.
If the SOL has not expires on some accounts, you need to validate those accounts with the CA, because charge off doesn't mean that you need not pay. The CA may sue you for nonpayment. After the validation, if you really find that you owe the debt, then you need to pay the dues. If you are unable to pay the whole amount, you can settle the amount to be paid, with the CA. Along with the settlement request the creditor for a Pay for delete agreement. With the pay for delete your account will be reported as "Paid as settled." However it is better to pay the dues in full. Your credit report will then reflect the item as "Paid in full".
However all the validation, settlement, agreement should be done through certified mail, so that you retain receipt copies.