5 Ways You Can Remove Charge Offs from Your Credit Report

In today’s hectic lifestyle, it’s easy to forget to complete some ordinary tasks – and one of those may be paying your bills. You may think that forgetting one bill or two is insignificant in the grand scale of things – but think again. Forgetting about paying one bill can wreak havoc on your credit. When you do not pay off a creditor for several months in a row, typically 180 days, that creditor will write off that debt as a loss. That lack of payment will be documented as a charge off on your credit report, and it will be there for all to see. 

If, for example, you want a mortgage, new credit card, or secure financing for a loan, new creditors will look at your credit report and see that charge off. This is a blatant indication of your potential inability to be responsible with your finances. Based on your credit past, there is a good chance that they will not extend credit that you want. Current creditors could raise your interest rates – all because of your charge off. 

Even after a creditor writes off your debt, you are still responsible for payment. A creditor can use in-house staff or a collection agency to try to recoup their rightful payment. 

It is in your best financial interest to attempt to remove charge offs from your credit report. While there is no guarantee that this will happen, there are strategies as to how to remove charge offs: 

  1. Review your credit report: Do you know what details are in your credit report? How much of it is correct, how much is outdated, how many mistakes does it contain? You can see if you have a tendency towards late payments, missed payments, or too many credit cards that can affect your credit score. In particular, you can check for old charge offs, or if it lists charge offs that are not yours! Once you have information, then you take action. 
  1. Tackle that old charge off: Charge offs remain on your credit report for seven years, and should automatically be removed once that time frame is over. But credit bureaus can make mistakes, and old charge offs may still be recorded. Contact the credit bureau in question and make a formal dispute to have the item dropped from your report. 
  1. Talk to a credit bureau: If you see a current charge off on your account that is not yours, you need to dispute this with the credit bureau. It also may be that your charge off is inaccurate or misleading. As well, if you forgot to update your address after moving, you may not even know that you have a delinquent bill until a loan application is denied or your credit card interest rate increases dramatically. 
  1. Talk to your creditor: When it comes to how to remove charge offs from your account, it is better to deal with the creditor who reported the charge off than with a debt collector as a collector cannot change what the original creditor reported to any credit bureaus. By talking with the creditor, you may be able to encourage them to remove the charge off in exchange for a settlement. But before you contact your creditor, know how much you can pay and when you can pay it. Also, speak to someone who is allowed to remove the charge off from your account. If you are not comfortable negotiating over the phone, you can send a pay-for-delete letter, which asks the creditor to remove the account from your credit report in exchange for full payment. If the creditor won’t delete the charge off, then request a less negative status of Closed. And make sure you get it in writing for proof. 
  1. Talk to the collection agency: Paying off a collection debt won’t delete a charge off from your credit report, but you can ask the agency to remove their collections record from your report as part of the negotiation for paying your debt. This will have a more positive affect on your financial record. Collection agencies are not obligated to do this, but you won’t know until you ask. 

How to remove charge offs isn’t easy, but if you hope to obtain a mortgage in the near future, then the time to act is now. Get the facts about your credit history, then have honest communications about how to remove charge offs, and after, do the work to fix your credit for the future. The sooner you do this, the better and easier it will be to get that mortgage. And that means the sooner you can own the home that you want. 

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