If i want to clean up my credit should i start by sending in small payments to collection agencies?

As for disputing something on the credit bureau and having it come off is a myth. Too bad people believe this. Typically the only things to removed with this method are outdated accounts over 7 years old. The best way to remove a collection is pick up the phone and make arrangements with the collection agency. Collectors are people too and will usually work with anyone who wants to clear their credit.

Read Catdad's post for sure, that is great advice. If you want to clean up your FINANCIAL LIFE then look at the Dave Ramsey approach. His way can get you out of all payments it is tough but worth it.

http://www.daveramsey.com/

He give you advice on dealing with collection agencies, credit cards, and banks.

One advice NEVER EVER give electronic access to your bank account! They can clean you out! even if you agree to a amount to settle. If you settle the debt have them write you a letter confirming that if you pay this amount it will settle the account. Then get a money order or cashiers check and send it to them. Keep copies FOREVER because they can come back and try to get the difference but you have the letter and the check then you can send them copies off.

Check out Dave Ramsey he will help you out with all your problems.

Catdad is giving you pretty good advice. You can find more advice at our website and also information on how to have unpaid collections removed from your report. Feel free to contact me on further details regarding this process. However, again, it is often very detrimental to pay collections. Much better to have them removed for a fraction of the cost.

We average 24 pts per month restoration and 6 deletions of negative items per month. I would be happy to give you a full free analysis of your credit and what items are likely to come off. I can also point out areas of your positive credit where you can maximize your points.

devin@nationalcreditcare.com

www.nationalcreditcare.com

Be careful...renewing contact with debt collectors over old debt may stir up more trouble than it's worth. In a nutshell: Your focus should be on paying off any recent non credit card debts. Paying back old charged-off credit card debt will not really help your credit rating.

You may be able to negotiate the complete removal of non credit card debts like defaulted cell, medical, utility bills etc. from your credit report with a Pay for Delete agreement. This is a written agreement where you get a signed agreement from the debt collector (PRIOR to making any payment) where they offer to remove the negative items from your credit files after an agreed-to amount is paid. They will NOT want to do this....all they want is your money and their commission and they could not care less about your credit rating....Still, you have something they want (money) and that puts you in a position to negotiate on this issue. Example letter:

I am willing to resolve this issue if your firm sends me a written agreement that you will remove all negative notations from my credit report after the agreed-to amount is paid to you. Upon receipt of this letter I will mail you a USPS money order for this amount.

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Remember, all therms IN WRITING FIRST, then you pay. Never accept verbal promises over the phone...they'll promise you anything over the phone to get your money then they'll deny that any agreement was ever made once they have your money.

- When a credit card is charged-off as bad debt, you need to understand that the damage to your credit is already done and there is no undoing it. Don’t make the mistake of simply cutting a check to whatever collection agency has the debt for the charge-off and assume that your credit rating will be magically restored...Doing so will not remove it from your credit reports. It will simply be updated to a "Paid Charge-Off," which, while slightly better, is still a seriously derogatory item. Per the Fair Credit Reporting Act, a charge-off, whether paid or not, can remain on a consumer's credit reports for up to seven years.

- There are two reasons that you may want to consider paying back a charged-off account:

1) You are applying for a new mortgage, loan or apartment and the creditor is insisting that all defaulted items be paid off

2) There is a confirmed lawsuit pending on the debt

If neither of these apply, then it’s often best to take a "Don't Ask/Don't Tell" approach...just sit tight and let the charge-off fall off your credit report naturally in 7 years. The main damage of the charge-off to your credit should be over in 2-3 years.

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If you're going to pay off old-charged-off debt anyway, then you might as well negotiate the lowest, rock bottom settlement you can possibly get, being that the negative charge-off notation is going to stay for 7 years on your credit report, regardless of whether the charge-off is paid or unpaid. ...Offer 25%. Mail them a vaguely worded statement like:

I am willing to settle this matter for 25% of the original amount. This is in no way an admission of this debt, but rather an attempt to settle this matter. Your firm must send me a written agreement on your company's letterhead that you will accept this amount as "payment in full" and that is issue will be settled. Upon receipt of this agreement, I will mail you a money order for this amount.

1-you can set up a payment plan with each agency, but they have to approve. Sometimes they will reduce the amount owing if you can make a lum sum payment of a lower amount. (ie. you owe $1000, but they may take $500 if you pay right away).

2-you can seek a consolidation company who will pay off the creditors and you would owe them one lump sum every month. (Keep in mind, they make money off you on this, because they renegotiate the amount with the agencies to make a profit for themselves).

3-get someone to co-sign a loan for you to pay everything off (consolidaiton), and pay the loan off. I would still renegotiate the amounts with the agencies to see if they will reduce the amounts before you offer to make a payment.

Free credit report.com is a good way to start. You can actually dispute things online and alot can get removed. I did this and got a 35,000 debt removed just by disputing it. Do not pay them first because it will not get removed anyway. First see what you can get taken off and then go from there. Good luck!