Zippy Credit Score Repair

Zippy Credit Score Repair

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Charge-off Removal

We remove charge-offs and raise your credit scores

What is a Charge off?

A charge off means that the original creditor has giving up hope that you will pay them back and considers the debt as a profit and loss write off.  Due to delinquent payments, your debt is re-categorized as “charged off” on the company’s profit-and-loss statements. The original company now considers the debt a loss and records it in their margins as bad debt and writes it off. The original creditor will either sell or transfer your delinquent debt to a collection agency or a debt collector.

At this point you will start receiving phone calls, text or emails from another company trying to recoup the debt. Once the debt is sold it may appear twice  as derogatory accounts and directly impact your score in a negative way in which potential creditors will see. This can ultimately hurt your chances for credit approvals and competitive interest rates so take advantage of Zippy Financial’s credit repair service that will remove a minimum of 70 percent to all negative items in 30 days.

Click here to book a free consultation and remove charge offs from your credit for only $299.99

Once a Debt is Charged-off Never Pay it!

Now that your debt has been sold and records as a charge off you should never pay it because it only benefits the debt collector. If you start paying off a charge off your charge off will remain on your account 7 years from the last active date. For example if you owed 5k and paid it off over the next 2 years the credit bureaus would start the 7 yrs of reporting that derogatory from the date of the last payment. Now you that charge off would show as a derogatory and effect your credit score for a total of 9 years. Creditors have a legal obligation to charge-off accounts when it reaches a certain number of days past-due, but the time frame depends on the type of debt and whether or not you worked out  payment plan to repay the debt.

Click here to book a free consultation and remove charge offs from your credit for only $299.99

Creditors charge-off accounts for their benefit, not the consumers.

Creditors have requirements depending on what type of primary trade line it is. For example, credit card accounts that aren’t on a payment plan to  pay off the debt must be put into charge-off status if the account is 180 days past-due while personal loans  charge-off the debt after 120 days of delinquency. If you are in a position in which you are late it would be best to contact  your creditor for their specific guidelines.

The bottom line is creditors charge-off accounts for their benefit, not the consumers. Now the debt collectors wants their money and will do whatever it takes to get it. This will include collection tactics, selling the account to a bill collector who works for a collection agency. The worst case case scenario would be the creditor filing a motion to take you to to court and get a judgment. A charge off is one of the worst derogatory items you can have on your credit report and will stay on your credit for 7 years.

What will happen if a Charge off is on your credit report?

Creditors will start by sending you letters reminding you of the past due bill and if that fails they move into the collections process. It will first show up on your credit report as a late payment and then re categorized as a charged off after your payment is 180 days past due. If it is a primary trade line such as an installment loans or mortgage it can be charged off after 120 days of delinquency.

Take note that your debt can be charged off even if payments are being below the account’s monthly minimum amount due. Once the debt reaches this status it is now a charged and reports to the credit bureaus as such. At this points it really start to decrease your credit score because you now have a combination of late payments and charge offs reporting on your credit. Late payments and delinquent payments have the most impact on your credit score because up to 35% of your score is determined by your payment history.

Click here to book a free consultation and remove charge offs from your credit for only $299.99

Why are Credit scores so important?

Your credit is the key ingredient to your financial success. It determines you getting a mortgages, loans, higher credit card limits, better interest rates as well your credibility if seeking employment. Many employers today look at your credit score before they even consider hiring you which is why it is essential to boost our credit scores. Every time a charge off reports on your credit report it has a negative effect on a credit score. Collection agencies will continue these derogatory items to the credit bureaus and decrease your credit score.

The amount of the charge off is irrelevant, For example, if you have a debt of $300 and it  will lower your score by 50 points the same as a $300,000 debt would. The old saying used to be don’t sweat the small stuff but when it comes to credit that does not apply based on the new algorithm system credit bureaus use to obtain your score. Zippy Financial’s personal and business credit services will start repairing and building your credit today to meet lender requirements.

What are the differences between Charge Offs & Collections?

A charge-off stays on your report for 7 years from the date is reports delinquent. Creditors use third party debt collectors to try to collect payments from the consumer. The original lender may still own the account but use a bill collectors in attempt to recoup the funds. When this happens only the original charge off balance reports on your credit. In the case of a collection if the creditor sells the debt, a new collection account will report to your credit file. This will show multiple derogatory items from the same debt on your credit report.

The more stringent the delinquency is based on the money you owe and how recent the collection which will be destructive to your credit score.  For example if your credit score is in the 700’s, one collection can cost you  over 100 points. This combined with other negative items can be devastating to your credit score and limit you from obtaining any credit at all.

Click here to book a free consultation and remove charge offs from your credit for only $299.99

How do the Credit Bureaus scoring models view Charge-Offs

Based on the latest FICO score model, FICO Score 9, treats collections contrarily than the previous FICO models in which it will ignore paid collections in the score calculation. Unpaid medical collections will have less of a scoring impact than the previous model and the Vantage Score 3.0 also ignores collections with a zero balance which is the good news. The bad news is that most lenders and creditors are not using these new score models. Smaller Charge Offs no longer effect credit scores  and it doesn’t matter how old or new the debt is.

The key to your collection not effecting your score is only if the amount started under $100 and it does matter how long it has been. For example, if you didn’t pay you cell phone bill for $78 and after the  late fees you now owe $178 it will not impact your score. Although,  these small collections will still show on your credit report.

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Zippy Credit Score Repair

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