Charge-OffsHere are opinions on whether you should let charge-offs stay on your credit report:
- It really depends on how long ago the debt was and what you are looking to do now. Paying the charged off debt will not increase your credit score, the damage is already done. However if you are looking to purchase a home or some other major purchase, it would be best to have the accounts show a zero balance. You can usually settle charged off accounts for 50% or less of the total debt. Otherwise you can just wait the seven years until they are removed.
- For any personal credit related concerns I recommend a website that I know has many very good answers to even the toughest questions. It is an 'ask' site directly on Experian's website which is hosted by Maxine Sweet, the V.P. of Public Affairs for Experian. You can get to the site from the following link: http://www.experian.com/ask_max/index.html
- From my own personal experience, if you can afford to pay your charge off in full, then do it. It not only helps your credit score but, when you go to apply for a loan, credit card, mortgage to buy a house or even a car although, it will still show up as a paid in FULL charge off. The lender will, more than likely, still give you what you are looking for because they'lll see it as "oh, this person just came on to some hard times but is cleaning up their credit by paying everything in full". When a debt is charged off, the creditor isn't expecting the borrower to pay anymore so, they may sell your account , or assign it on a contingency basis, to a collection agency.
You should always try to remove charge offs that are on your credit report. You can either negotiate the removal with the original creditor or you can try to dispute it to the credit bureaus. The credit bureaus have 30 days to verify the listing or it must be removed from your credit report. There is no reason not to try and remove your charge offs from your credit report.
