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How to Dispute Collection Accounts on Reports

Advertiser Disclosures

To “dispute a collection account” find an error or inaccuracy which includes dates, amounts, duplicate reporting and much more. Every piece of information in your credit reports must be accurate.

An inaccurate or misleading collection account will lower your credit score. Either because of clerical errors or miscommunication, collection accounts are among the most common errors on credit reports. That’s why factual disputes are better than disputing “account not mine”, especially if the account is really yours.

To find factual errors go through the negative tradeline and list every error, inaccuracy, incomplete or false thing you find. No doubt you can find a factual error or two, or three.

And when you find an error, request the credit bureau delete the negative tradeline, not make a correction. Corrected negative information is still negative.

The E-Oscar Investigation Method

Because the credit bureaus utilize the E-Oscar method of investigation, a consumer dispute is reduced to a two-digit code. This code is intended to best describe the dispute issue. What the code really does is reduce the credit bureaus’ time in processing disputes and eliminates the FCRA requirement for the dispute to be properly investigated.

When should you dispute collection accounts

You can choose to dispute a collection account at any time, however, there are times when disputing a collection account may produce better results. When an original creditor transfers a debt to a collection agency, the original creditor still owns the debt. It may be difficult to dispute in this situation. Working with the original creditor to resolve the debt may be the best option.

When the original creditor has sold the debt and it ends up in the hands of a junk debt buyer, you have a pretty good chance in disputing the debt and here is why. Junk debt buyers are collection agencies that purchase “old” debts and are working for themselves. Sellers of “old” debt include cell phone companies, utilities, medical companies, card issuers, and many other types of businesses.

Because junk debts are purchased for pennies on the dollar, debt collectors and junk debt buyers usually seek to negotiate a settlement with the debtor. They just want the money. Disputing the listing on your credit report may result in a deletion because they don’t have the time or desire to deal with credit disputes.

Dispute factual errors

  1. Account reporting “One Month Term.” What terms and agreements did you sign and agree to when the debt collector purchased the debt? None. Collection accounts should not have one-month terms.
  2. Account reporting as “120 days late”. How can this be? Collection accounts are not like original creditor accounts. You did not open an account with a collection agency and promise to pay monthly payments. The debt collector can report the last status from the original creditor but they cannot update lates on a monthly basis.
  3. Account is reporting as an “Installment”. Again, what terms and agreements did you sign and agree to when the debt collector purchased the debt? None. Is the debt collector posing as a bank, lender or finance company? Collection accounts are not installment accounts.
  4. Another common error is reporting the debt as revolving, which is not only inaccurate but may cause the credit score to further decrease. The collection account now looks like another revolving account in default and will be scored along with other revolving accounts on the credit report.
  5. Account “ balance” or the “high balance” is incorrect.
  6. Many collection agencies pose as Data Factoring Companies. Even if the credit bureaus allow this deception, you did not open a “data factoring account” with them. Collection accounts are not “data factoring accounts.”
  7. The date of first delinquency with the original creditor is not reporting and according to the FCRA, Section 623, “…A person who furnishes information to a consumer reporting agency regarding a delinquent account being placed for collection, charged to profit or loss, or subjected to any similar action shall, not later than 90 days after furnishing the information, notify the agency of the date of delinquency on the account, which shall be the month and year of the commencement of the delinquency on the account that immediately preceded the action.”

You will probably find more than one factual error, however, do not list all of them in one dispute letter. Save some for later in case you do not get the desired result on your first round of dispute letters. Disputing negative tradelines based upon factual errors may eliminate the credit bureaus’ excuse of “previously investigated” notation.

Finding factual errors causes the credit bureaus to do their job properly. Frustrate the credit bureaus to the point they will follow the FCRA and actually investigate a dispute or even better, frustrate them to the point they will delete the negative tradeline.

It may not work every time but you will find you can get a lot more mileage out of dispute letters containing factual errors whether than disputing “not mine” only to have the investigation results come back verified.

There could be negative consequences to your credit score by disputing collection accounts so it is important to read “What you should know before disputing a collection account.”

Dispute multiple debt collectors reporting the same debt

Debt collectors often sell accounts when they fail to collect. One collection account can change hands multiple times. Junk debt buyers often engage in this practice. When debts are assigned and sold to other collectors, there’s a strong possibility the collection agency listed on your credit report isn’t the agency that’s currently collecting on the debt. Only one debt collector at a time can pursue you for the delinquent debt. You can request the credit bureaus delete multiple collection agencies reporting on the same debt.

Dispute when debt collectors sell the account

Junk debt is typically resold 4-5 times before it goes away or the current owner of the debt files a lawsuit for resolution of the matter. The good news is the more a debt is resold from one junk debt buyer to another, the weaker the paper trail. The likelihood of any junk debt buyer being able to validate a debt is already low. But a debt that is repeatedly resold almost never comes with any supporting documents from the original creditor which could be used for validation.

With debt collectors selling accounts to other collectors it’s possible to get the account removed just by disputing or requesting debt validation. If the debt collector fails to respond to the dispute, the credit bureau should remove the account since it has not been verified.

Request debt validation

A collection agency must prove they have a legal right to collect the debt. The FDCPA entitles you to validate a debt when a collection agency demands money from you. If a collection agency can’t validate the debt, the credit bureau cannot list it as a negative mark on your credit report.

Once you request debt validation, the collection agency must stop all collection activity, including reporting and verifying, until they supply proper validation of the debt. Although there is no specific time limit for the collection agency to validate, they cannot continue collection activities until they provide validation information.

The key to debt validation is timing. Even though you can request debt validation at any time, the FDCPA only supports a consumer’s request for validation that’s done within a 30-day period after receipt of the collection notice. Which means the consumer must make their request for validation within 30-days of receipt of the collection notice in order for the request to be timely, and thus impose a cease collection bar on the debt collector.

Note that after receipt of a timely debt validation request, the debt collector is under no requirement to provide the requested validation. The debt collector can simply choose not to respond but they cannot continue any further active collection activities on the debt.

Debts that are repeatedly resold almost never come with any supporting documents from the original creditor that can be used for validation. Request the credit bureaus to remove unverified debt. Find out more about debt validation.

Offer a pay for delete

If you can’t remove the debt by disputing it, try negotiating a “pay for delete” with the collection agency. With a pay for delete the collection agency removes the account from your credit report in exchange for payment. Send the collector a letter stating your interest in paying the account. Offer to make payment if the collector agrees to remove the entry from your credit report. Ask that the collector to return a signed copy of the letter to you to seal the agreement. Make sure you get the agreement in writing before you make a payment. Don’t make any payment, full or partial, until you have the agreement in writing. See (Sample Pay for Delete Letter.)

Options if disputing does not work

If you have exhausted your dispute efforts there are still options you can attempt. Make complaints to the CFPBthe FTC, or your state’s attorney general. You can also sue the debt collector for this or other violations of the Fair Debt Collection Practices Act (FDCPA). If you sue under the FDCPA and win, the debt collector must generally pay your attorney’s fees, and may also have to pay you damages.

If you already paid the debt – request a goodwill deletion

You can ask the debt collector for what’s called a “goodwill deletion.” People who are familiar with requesting a goodwill deletion typically associate the practice with original creditors. But goodwill deletions can also be requested for paid collection accounts. Write the collector a letter explaining your circumstances and why you would like the debt removed. There’s no guarantee your request will be accepted, but there’s no harm in asking.

Final thoughts on removing collections

Consider allowing a professional repair your credit. Lexington Law They have assisted clients in removing over 10 million negative items from combined clients credit reports last year. Those negative credit items included: Bankruptcies, Foreclosures, Tax Liens, Repossessions, Judgments, Collections, Late revolving credit payments, and Inquiries.

Other methods can be used to get rid of collection accounts such as debt validation, settle the debt and even pay for deletion of a collection account.

34 thoughts on “How to Dispute Collection Accounts on Reports”

  1. Hello, this may be confusing. I apologize:
    I am currently disputing a (Cable/Wireless) acct through my credit Karma. This acct is only listed on my Transunion, so I disputed directly with that Bureau. Since disputing, I have received no REAL “verification” for the acct in question from the collection agency; instead I’ve been mailed an itemization for a totally different account(2 hospital procedure bills from 2013) for someone with my exact same name who lives in a different state, BUT addressed to me.
    I’ve never had a cable/wireless account with the company listed on my Credit report, and I have never been to Arizona, where the hospital bill originated. This will be my 2nd attempt at disputing the (cable/wireless) acct.
    While I am waiting for the results of the second investigation to finish, I’ve written up a brief letter to Transunion explaining to them that the acct I am disputing is NOT mine and has NOT been verified, I have also attached the fake “verification” I received from the collection agency. Again, the hospital bills are not on any of my reports. It’s weird that the outside of the letter was addressed to me, yet the inside has the other Johns address. Is it a good idea to send Transunion the information the collection agency sent me? I have a very common name. Hint: Last name is NOT Smith. My dad and I also share the same name.

    1. Wait to see what comes of the dispute before taking action. Hopefully it will be deleted! If not, submit a complaint with the Consumer Financial Protection Bureau for credit reporting errors. You would submit any supporting documentation to them. From that point, the CFPB would contact Transunion directly on your behalf. That should resolve the issue.

  2. There is a collection agency collecting on a debt for an outstanding obligation with an apartment that I early terminated. Apparently the apartment complex was purchased by new management and the agency is reporting the original credit as the “New Management Company”. When requested that they validate the debt the collection agency provided the executed copy of the Lease Agreement that is between Vista Landing LLC and myself. Being as though the collection agency isn’t reporting the accurate information how could I go about disputing this debt? In my opinion, they are reporting that I owe a creditor that I’ve never heard of and requesting payment, however the agreement is with a totally separate company. Please help.

    1. The dilemma here is that the purchase contract between Vista Landing LLC and the new management company may have included Vista Landing LLC’s assets as well as liabilities. If so, they may have a legal right to collect debt owed to Vista Landing LLC. This could give the new management company sufficient authority to go after you for the unpaid debt owed to Vista Landing LLC. Plus, they have the original contract which can be viewed as sufficient validation.

      Your dispute would be that you don’t owe a debt to the “New Management Company.” But if you pursue a dispute based on inaccurate reporting of a debt not owed, there’s always a chance the new management company will verify their reporting as accurate because they purchased Vista Landing.

      If the dispute is verified as accurate you’ll likely have to pursue a different strategy by researching your States Landlord/Tenant Laws. Each state has laws governing landlord/tenant issues including breaking a lease. As such you may be able to challenge the amount owed in areas such as:

      • A fair re-letting fee that covers actual expenses for getting a new tenant – did the landlord take reasonable efforts to re-rent your unit rather than charge you for the total remaining rent due under the lease.
      • Cleaning fees.
      • Acceleration to the end of lease fees.

      Another debt validation letter may be needed after you research your state’s landlord/tenant laws to see where the landlord may have fell short, then bombard the new company with demands for documentation on how the amount they arrived it was calculated.

  3. Hello, on my husband’s Equifax report it shows a Medical collection (date of first delinquency is March of 2011). I know this will “fall off” within the next 7 months. However, my husband is applying to the police force, and is required to clear up any collection accounts. Unfortunately, Equifax does not list any contact information for the collection company except an abbreviated name. I have tried googling the name with no luck. How can I contact the collection agency to negotiate a payoff and deletion? Is Equifax required to provide that contact information? Thanks so much!

    1. Yes, credit bureaus are required to provide name and address of a creditor or collection agency reporting to your credit reports. But before you request the full name and address of the collection agency, request early exclusion of the old account. Call Equifax directly and request they remove the collection from your reports early. Sometimes they say no over the phone, but go ahead and remove the account if it is close to being excluded from your credit report anyway.

  4. Hi Lisa,
    I recently checked my credit history from annual credit report, myfico.com and Experian. I have one account in collection and am worried that I might have done something that flagged this collection company to potentially report negatively to the other credit bureaus.
    Brief story regarding this account. Back in 2008, my boyfriend at the time and I moved in together. Things didn’t work so I moved out in 2011. He asked that I keep my name on the lease to help him build his rental history and he doesn’t have to renew the lease. So I didn’t realize he lost his job later on that year and eventually got evicted. I recieved a letter from the orginal managament company that I owe this amount. I tried to dispute it but they wouldn’t budge unless I started paying them. I contact my boyfriend (my ex) and he said he would resolve this and pay for it. So for a few years, I didn’t see anything reported and assume it was resolved. Until recently, I saw it was reported through another collection agency. I tried to dispute on Experian.com but I made the mistake of report it as “not mine” with no addition comments. It came back with this result:NETWORK COMMERCIAL SER
    Account Number: NCSISKS7330285919 Outcome: Updated – Information on this item has been updated. Please review your report for the details.

    Details Of Dispute Results Back to top

    Potentially Negative Items or items for further review Back to top

    This information is generally removed seven years from the initial missed payment that led to the delinquency. Missed payments and most public record items may remain on the credit report for up to seven years, except Chapters 7, 11 and 12 bankruptcies, which may remain for up to 10 years. Unpaid tax liens may remain for up to 10 years from the filing date. Paid tax liens may remain for up to seven years from the filing date. Transferred accounts that have not been past due remain up to 10 years after the date the account was transferred.

    Payment history legend
    OK Current/Terms of agreement met
    30 Account 30 days past due
    60 Account 60 days past due
    90 Account 90 days past due
    120 Account 120 days past due
    150 Account 150 days past due
    180 Account 180 days past due
    CRD Creditor received deed
    FS Foreclosure proceedings started
    F Foreclosed
    VS Voluntarily surrendered
    R Repossession
    PBC Paid by creditor
    IC Insurance claim
    G Claim filed with government
    D Defaulted on contract
    C Collection
    CO Charge off
    CLS Closed
    ND No data for this time period

    Credit Items


    (818) 343-4800
    Account Number:

    Original Creditor:

    Address Identification Number:

    Collection account.

    Status Details:
    This account is scheduled to continue on record until Sep 2018.
    This item was updated from our processing of your dispute in Aug 2017.

    Date Opened:
    Reported Since:
    Date of Status:
    Last Reported:
    08/2017 Type:
    1 Months
    Monthly Payment:

    Credit Limit/Original Amount:
    High Balance:
    Recent Balance:
    Recent Payment:

    Payment History:
    2017 AUG

    Account History:
    Collection as of Aug 2016 to Aug 2017, Jun 2012 to Feb 2016

    Balance History:
    Jul 2017: $5,616 / no data / Unknown / Unknown
    Jun 2017: $5,585 / no data / Unknown / Unknown
    May 2017: $5,553 / no data / Unknown / Unknown
    Apr 2017: $5,527 / no data / Unknown / Unknown
    Mar 2017: $5,493 / no data / Unknown / Unknown
    Feb 2017: $5,465 / no data / Unknown / Unknown
    Jan 2017: $5,437 / no data / Unknown / Unknown
    Dec 2016: $5,409 / no data / Unknown / Unknown
    Nov 2016: $5,376 / no data / Unknown / Unknown
    Oct 2016: $5,346 / no data / Unknown / Unknown
    Sep 2016: $5,314 / no data / Unknown / Unknown
    Aug 2016: $5,285 / no data / Unknown / Unknown
    Feb 2016: $5,103 / no data / Unknown / Unknown
    Jan 2016: $5,075 / no data / Unknown / Unknown
    Dec 2015: $5,042 / no data / Unknown / Unknown
    Nov 2015: $5,013 / no data / Unknown / Unknown
    Oct 2015: $4,981 / no data / Unknown / Unknown
    Sep 2015: $4,952 / no data / Unknown / Unknown
    Aug 2015: $4,923 / no data / Unknown / Unknown

    Limit High Balance History:
    The original amount of this account was $3,611

    Shortly after this dispute, I recieved a letter from this collection company Network Commercial Service thay I need to pay in full with the current balance within 15 days or they can further report this to other credit bureaus. So far, this is the only reported on Experian. This is the only collection account I have and is the only one negative on my Experian account. All my other accounts from TransUnion and Equifax are all good.

    My question to you is, did I made the mistake of disputing it and stir something up? Can I dispute it again and state the factual error or should I leave it alone and wait for it to be removed? Also, will the letter from the collection agency do what they said if O don’t pay them within 15 days? I am so worried about this. I have been married for almost 2 years and I don’t want this past account to affect my husband’s credit or further damage my credit. Please help. Thank you for your time. I look forward to your reply.

    1. First, your husband’s credit will not be impacted by a negative account on your credit report. The only way his credit could be impacted is that the account was in both of your names. However, if you apply for credit together, any blemishes in your credit file may cause approval with less favorable interest rates and terms.

      Second, yes, more than likely the dispute triggered the debt collector. Unfortunately, that can be an unintended consequence of pursuing credit repair. Disputing a collection account could trigger new debt collection actions because a dispute causes the credit bureau to contact the furnisher of information to verify whether the account is accurately reporting.

      Asserting a different dispute may end in the same result. Keep in mind the credit bureau can dismiss the new dispute as frivolous if it is substantially the same as the prior dispute. On the other hand, if the new dispute includes additional information not previously submitted, the dispute is not “substantially the same” and must be considered.

      I can’t accurately predict what will happen. But an additional dispute probably won’t hurt at this point because the debt collector is now pursuing you. If the debt is yours they will verify it as accurate and might even correct any factual error that you dispute.
      If the second dispute comes back verified a different approach might be to submit a complaint with the Consumer Financial Protection Bureau for lack of an adequate investigation of the dispute.

      As far as the collection agency reporting to additional credit bureaus, a creditor or collection agency reporting to the credit bureaus is a contractual agreement. It is not mandatory by any law that creditors or collection agencies report information to the credit bureaus at all. The collection agency may only have a contract with Experian. But there is no way to predict whether they will report to Transunion and Equifax. It could just be a threat to motivate you to pay; or, they could contract with Transunion and Equifax to start reporting.

      Other options could be to negotiate a pay for delete; or, just wait it out like you stated. Unfortunately, you can’t undo the first dispute. Just remember going forward that disputing an account as “not mine” when it really belongs to you can lead to a whole host of unintended consequences.

      I wouldn’t beat myself up about the dispute. Really, the collection agency coming after you could have occurred anyway, especially as you get closer to the date it’s due to be removed from your credit report. And, if your credit report and scores look better, or you apply for new credit, the credit bureaus will alert the collection agencies that you may now be in a position to pay the unpaid debt. And poof, here comes that old debt!

  5. What happens when you file a dispute for a debt that has been sold to collections, and the dispute comes back that you aren’t liable anymore?

    1. Well that’s a new one for me. I’ve never heard of “not liable anymore.” It seems to me since you were told you are not liable anymore you should request the credit bureaus delete the item as obsolete. See if that works, if so, then your work is done. If not then you may want to seek deletion by making a complaint with the Consumer Financial Protection Bureau. You have supporting documentation stating that you are no longer liable; therefore, request a deletion from credit reports.

  6. So if I finished paying my students loans last year in March. But they are showing up on my report as one month terms, 120 days or more late, and garnishments. Do I contact the student loan people or credit bureaus for the status updates?

    1. Paid student loans should report with a $0 balance and state “Paid” on your credit reports. Unfortunately, the default and negative notations can remain including the past late payment history and garnishment for 7 years from the original delinquency date. If your student loans became delinquent less than seven years ago, they still can still appear in your history.

      You can write a dispute letter directly to the student loan lender requesting that the account be updated to paid; and, include in your letter a request for the past negative information be deleted. While they are not obligated to delete accurate negative information it doesn’t hurt to request a “goodwill” deletion of the negative history on the account since it is now paid in full.

  7. Hello, I had a question regarding the “Factual Error” portion.

    I had a cell phone account that I was on with another person. Long story short, they let it go delinquent without my knowledge & the balance was more than I could ever pay as a unemployed college student. (This was in 2010) However, I just checked my Experian report and it had the following listed:
    Payment Status: Unknown
    Balance: $1,000.00
    Date Open: 06/01/2013
    Last Updated: 09/01/2013
    Account Status: Closed
    Terms: 1 Month
    Phone #: –
    Address: –
    Ownership: Individual

    My concern is that they essentially renewed the date. It’s not from 2013, it’s from 2010 & I definitely didn’t agree to any 1 month term, nor have I ever spoken to any kind of debt collector/buyer, especially this company. I have never noticed this error because it doesn’t show up on my TransUnion report, which is usually what receive every year for my credit check, this was on Experian.

    My question for you is, I’m looking to buy a house (my first one) & my Credit score is 711. I have NO debt (other than the above which was supposed to reach the statue of limitations in one year), car loans, student loans or credit cards etc… Is it worth trying to dispute this factual error to remove it from my report (making my score improve even more)? OR will it just ‘reopen’ the debt & negatively impact my credit, therefore ruining my chances of getting my home?
    Thank you!

    1. Unless you go with an FHA mortgage loan most lenders will probably require that you deal with an unpaid collection account. I believe an FHA lender will ignore an unpaid collection of $1000 or less. You can dispute the 1 month term because you certainly did not open an account with ANY terms with the collection agency. As for the dates mentioned above, they more than likely reference the date the collection agency got the account. It does not mean it will remain 7 years from the 2013 date in which the collection account was opened. The date of the collection account is removed DOES NOT change unless the account has been re-aged.

      If you have your full Experian Consumer Report it should show a date in which the collection will be deleted and that should be 7.5 years from the date the account first went delinquent. If you want to make sure when the account will be removed write to Experian “Please provide the obsolescence date on this account. Also please provide the month and year the obsolescence date is based on for FCRA compliance date.”

      The bottom line I would suggest you make sure of the date the account will be deleted and then leave it alone. I only say that because Pinnacle is a real pain to deal with. It just may not be worth your time.

  8. We have been sent to collection over a former apartment complex stating we owe for cleaning fees ( not in the lease) and new carpet a w/s/t bill etc. They sent use to a collection agent 38 days after we moved out. We disputed the issue with the OC and with the CA they reported us to the credit bureaus as soon as they got the case they refuse to tell me who owns the “debt” they refer to the OC as their client. it is listed on the three reports as open and one as closed but one month terms. I have never had my day in court they refuse to take us to the judge I dont think they have the right to decide I/we owe this. I have videos of the unit as I left it clean but the carpet was falling apart I show this. I requested the age of the carpet and they refuse telling me they do not have to provide me anything. I plan to take this matter to the courts but I am trying to get it off our reports first. They do not have any proof other than the rental agents say we owe what makes their word worth so much and ours worthless?

    1. It is not unusual for property management companies to send unpaid debt related to apartment leasing/rent to a collection agency weeks after a debt goes unresolved.

      The collection agency is doing what collection agencies do – collect debt. They are not there to choose sides so your word over the rental agent’s word is irrelevant to them.

      I strongly urge you consult an attorney in your area familiar with landlord/tenant laws. And, if you have not already done so, review your state’s tenant laws as well as liability of landlord laws to thoroughly know your rights.

      As far as credit reporting, the FCRA says information reported must be accurate. Any inaccurate information that is being reported, such as “one month terms” should be disputed.

      Also, the FDCPA, Section 808(1) prevents a debt collector from attempting to collect any amount that is not specifically authorized in the agreement creating the debt or otherwise permitted by law.

      Pursing legal action is a good idea especially since you have video proof. However, getting the negative marks removed may only happen once you actually pursue legal action. I say this because the debt collector has not cooperated with your requests. Legal action may be the only way to get their attention.

      It sounds like you’ve already requested debt validation. But unfortunately, under the FDCPA, requesting debt validation does not compel a response from debt collectors. It only puts into place a cease collection bar until they choose to provide validation.

      You might want to try a complaint against the collection agency with the Consumer Financial Protection Bureau to try to compel them to produce the documents you requested and get the unverified/disputed marks deleted from your credit reports.

  9. I’m glad I found this site. I have no past due accounts showing at all on my credit history. I’ve worked hard to get those accounts deleted. However, my credit score is still very low. Experian 583, Equifax 567, and TransUnion 574. I have had credit cards in good standing reporting on my account for over two years now. Unsecured Visa and Mastercards, Car loan with Capital One Auto, and a paid in full car loan with Ally….plenty of good credit. Yet, when I am denied credit it ALWAYS says something like “Numerous Finance Accounts”. Back when I did have credit issues, finance companies were a huge help. I now only have two open finance company accounts, but on my credit report there are 37 closed and paid in full finance companies with different lenders. Every single closed account shows a perfect payment history. My dilemma and question is this…..I’ve worked hard to pay everything on time these past years. I now need to buy a house in February and need my score raised. The finance companies are all local people that I know…..they have offered to complete delete the accounts from my credit….as if they never happened. But, will doing that lower my score because I paid those accounts well? Or, will it help my score to have those accounts deleted? The accounts are as follows: 10 closed with Security Finance, 9 closed with World Finance, 11 closed with Local Finance, 1 closed with Resource Finance, 3 closed with Associate Finance and 3 closed with Freedom Finance. In each instance, I would “renew” a loan which would in turn closed the old one and open a new one….I had no idea each time I renewed it reported as a newly opened account. It’s just a mess and I’m scared that if I have the accounts deleted it will hurt me more than harm me. I need some advice please. 🙂 If you need some follow up questions answered before responding, please send them and I will give you more details. Thank you! My credit report is 27 pages long due to this account and i’m scare it will send a message to a loan underwriter that I am “risky” or that it will lower my score. My other option is to leave them on my report and when I apply for the loan write a letter of explanation that at the time I was under a hardship. Thoughts please! 🙂

    1. Congratulations on getting negative information deleted. That’s a huge accomplishment. The best advice I can offer is to continue making on-time payments and make sure credit card balances are paid in full each month. Try to carry a small balance on only 1 credit card and let the others report as $0, this will help your credit score.

      Now as far as the finance companies; I have to admit this is a FIRST for me — I’ve never heard of someone having so many. I can say for sure they are not helping your score, even though they were paid on time. I fully understand at times you have to do what you must but now your circumstances are different. If you have an opportunity to DELETE them, I strongly suggest doing so.

      Here is what may be keeping your scores low:

      (1) Too many accounts overall. Your FICO scores look at the total number of accounts you have. Consumers with a moderate number of credit accounts appearing on their credit reports represent lower risk than consumers with either a relatively large number of credit accounts.

      (2) Too many finance company accounts. Finance company loans represent a higher risk to lenders compared to having no consumer finance company loans reported. Even if the accounts are reported as closed, it can still impact your FICO scores.

      Here is a plan of action I suggest from now until February 2016:

      a. Pull your credit scores from myfico.com (you want to monitor all three). It’s going to cost you something like $59.95 but it will be worth it to see your actual FICO scores and your FICO scores used for mortgage lending.

      b. Request a deletion directly from the finance companies of let’s say half of the 37 finance company loans. Wait for the deletions, it may take up to 30 days. Then pull your FICO scores from myfico.com to compare the difference. If there is a boost in your scores then you know for sure the finance company loans are hurting your FICO scores.

      c. Ask the remaining finance companies to delete the tradelines. Wait for the deletions to take place then pull your scores a 3rd time. While I can’t guarantee a huge boost in scores, I am sure they will improve (as long as you have no current late payments and do not increase the credit utilization on your other accounts).

      Even if there is just a relatively small increase in scores, it will worth having the finance companies removed from your credit reports. Any mortgage lender would be hesitant, even with a good explanation, of offering you a mortgage loan with so many finance companies on your credit reports. Get rid of them.

  10. My husband has a collection account on his credit report. It lists the account type as “Open Account”, Loan Type as “Factoring Company Account”, Pay Status “In Collection”, and it also states the Original Creditor name. Can this account be disputed? I pulled his TransUnion credit report, and looked thru it to see when was the DOLA on the original cell phone account, and it is no longer showing on his report. Before I move try to dispute it, the credit report states that this collection account is scheduled to be removed 12/2015. Can I dispute it if it is listed as a collection account, and should I dispute it? Thank you for all your help.

    1. The fact that the collection agency listed the account as a “Factoring Company Account” can be disputed. Factoring accounts are typically a transaction in which a creditor sells its account receivables to a financial company (factor). The accounts represent assets in good standing that have yet to be collected. The creditor can then receive quick cash rather than waiting to collect payment from a customer.

      Credit bureaus unfortunately allow junk debt buyers to pose as Factoring Companies when they are not. You have the basis for a dispute under FCRA, Section 623 because the “furnisher of information” is reporting inaccurate information to the credit bureaus. The issue is it may take several dispute letters to the credit bureau along with dispute letters to the debt collector before the listing is deleted. Be prepared to be diligent in your dispute letters specifically asking for proof of the “factoring documents” which are required to be filed with the Securities and Exchange Commission (SEC). You can challenge them for documents showing you factored any account receivable accounts with them, you signature on any factoring documents, security or bond documents I am sure are required by the SEC.

      It is highly unlikely they could produce said documents because none exist. I don’t know, you might get lucky and Transunion may just remove the account early. If not, you may want to consider whether the time involved is worth it since the account is due to be removed in a few months anyway.

  11. I ONLY HAVE 1 BILL THAT WAS SENT TO COLLECTIONS FROM SPRINT !! MY CREDIT SCORE WENT DOWN 50 POINTS BECAUSE OF THIS !!! I SWITCHED CARRIERS AND THEY CLOSED MY ACCOUNT AT 600 BUCKS …THEN THEY SENT IT TO COLLECTIONS AND IT IS NOW 1800!!! THERE IS NO WAY IN HELL IM GOING TO PAY THAT!! But i have been working on my credit and that 50 point loss has me in the verge of tears all because i switched carriers and didnt even get a call or anything to resolve the issue!… help!!

    1. The only options I can suggest are listed above. You can dispute the account if there is an inaccuracy or error to see if it comes off or you may be able to negotiate settlement for less and request a deletion as part of that settlement.

  12. I have disputed entries by the top 2 bottom feeders with the Equifax. I called procedural error and 2 times they came back verified. Next step was to get the FTC, CPB and AG involved. disputed 3 more times since they are listing as “Open” Factoring accounts, current , no DLA, ect . Equifax again gave a bottled response that yes the account was mine because they have my name, address and phone number. Not once did they ever address the actual reason for the dispute. CPB is looking like a serious waste of time since they do not want to do anything and have knowledge of what a factoring account is.

    1. While I’m a big fan of the CFPB their investigators sometimes miss the mark in identifying the deception of certain junk debt buyers. Debt collectors reporting as “Factoring Companies” is an attempt bypass debt collection laws and unfortunately it sometimes works.

      From my understanding a factoring company buys debt that is in good standing, not debt that is in default. In order for monies to be factored, the debt must be in good standing. By the very action of purchasing “charged off” bad debt it should prohibit junk debt buyers from being factoring companies.

      It seems you have done all you can do on your own. It may be time to seek the advice of an attorney well-versed in the FDCPA and FCRA. Court action may be the only catalyst to either force the junk debt buyers to report correctly or preferably delete the accounts. I don’t see any way a JDB could prove in a court of law that they are a Factoring Company that purchased a debt “in good standing.”

      Clearly the JDB has violated the FDCPA for knowingly reporting inaccurate information to a consumer reporting agency which is known or should be known to be false, by reporting the account type as “OPEN”.

      They are also violating the FCRA for knowingly reporting inaccurate information to a consumer reporting agency “Type Of Loan: Factoring Company Account”.

      You may be able to get a free consultation with a consumer law attorney to get a clearer understanding of your options. NACA.net has a listing of consumer law attorneys by state and specialty. Good luck to you.

      1. Well since I have had issues with a law firm hayte, hayte and landow ( yes another bottom feeder that sues you and hopes you don’t show up ) I keep an attorney on retainer to deal with issues if I can unable to make any headway.
        Yes, Factoring accounts are Accounts Receivables in good standing that are purchased for a % of the whole value. Unfortunately Debt collectors do use this to violate the law and can in no way ever prove that they purchased the debt while It was current.
        I also advise that everyone keep a history of their credit reports handy, it cant hurt to show how they were reporting previously.

  13. My CreditKarma is showing two cell phone accounts in collections and it says they were open this year. Those accounts havent been open for more than 4 years. How do I dispute this?

    1. Even though the credit report information you view at Credit Karma comes from Transunion and Equifax, Credit Karma is not a credit bureau. To make sure you are viewing accurate information you should first order your credit reports directly from the 3 major credit bureaus to check for errors or mistakes. Doing so will give you access to a “credit report number” which allows you to dispute information with the credit bureau reporting incorrect information.

      Credit Karma is not a credit bureau. They don’t gather information from creditors or collection agencies, and creditors or collection agencies don’t report directly to Credit Karma. You must order your reports directly from the credit bureaus then dispute the opening date of the collection accounts you mentioned.

    1. The collection agency has not extended any type of credit to you. There are no terms existing, not even “one month” because you have no written agreement to pay them. I would dispute it based on the Fair Debt Collections Practices Act. FDCPA 807 (2)(a) that deals with misrepresenting the character, amount, or legal status of a debt. Also the Fair Credit Reporting Act at 623 (a)(1)(A) says furnisher of information (that would be the collection agency) cannot report information they know is inaccurate. The collection agency knows very well you do not have any type of “terms” with them. Request the credit bureaus delete the entire listing based on those factual errors. Now be prepared the collection agency could simply fix the error which means the listing can remain but it would be reporting correctly. Good luck to you.

  14. I’m tackling my reports – and man is it a hefty task but thanks to people like yourself, it isn’t as hard as it could be.
    Here’s my question – I have 4 collection accounts (each duplicated 3 times – once in open accounts, once in neg. accounts and once more in closed accounts of my Equifax 3-in-1) They all state open or installment which I will dispute – but first, all of these collection accounts list the original creditor in the comments section but on my credit reports there is no record from each of these OCs (Bally Total Fitness (2xs), Sprint, Bright House Networks). What does that mean?? Do I have something going for me here, or does the OC not have to report at the same time the collection accounts are reported? If so, how would I compare? and if I do indeed dispute this, if it is correct, it’s probably possible for the original creditor to suddenly appear… Then it would be worse? I don’t know. All debts are $1500 or less and are reported as opened within the last three years.

    Any help would be greatly appreciated.

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