Consumer Credit Counseling

While negotiating with your creditor during a debt settlement program your ultimate motive is to see your account position as, "Paid as Agreed" or "Account Closed- Paid as Agreed". Any comment other than this is not a positive sign in the case of a debtor.

Why does a creditor usually agree to change a listing?
In most cases the creditor agrees to change the listing if the debtor agrees to pay for a new contract on a fresh repayment scheme. The creditors target to collect funds from the debtors and not by reporting negative credit information. The creditors realize this requirement on the part of the debtor and in maximum cases delete all negative listings on your credit report after settlement of debts. Their main concern is to collect dollars from you and if you pay them, they will not hesitate to mark you perfect in your credit rating. On the other hand you can always opt to pay the creditor who is willing to change his listings if one creditor denies doing so.

Tips for the smart and advanced negotiators
Unfortunately if your account has been placed in the hands of a collection agency you will have to face two negative listings on your credit report. One negative listing from the collector and the other from the original creditor. If your original creditor is not interested to have dealings with you, he might forward your case to a collection agency. It is quite difficult for the original creditor to remove your negative listing. But it is not impossible. In such cases you must request the collection agency to remove the negative listing completely and persuade your original creditor to make it "Paid as Agreed".

Remember you have a legal right to request the removal of your negative listing. Sometimes the collection agency may say that they have no hand in manipulating with the original creditor which is not totally wrong. However, at such moments you have to seriously commit the collection agency to pay the money and they in return will definitely convince the original creditor to clean your negative listing. Don't forget if you pay then both the collection agency and your original creditor are benefited.

In case you are bound to accept an imperfect credit listing:

• Unrated Account: Sometimes it might so happen that your creditors may not be willing to delete the negative listing from your file. In such situations request him to list your account as "unrated". 'Unrated account' means it is neither positive nor negative. It is neutral and has no negative effect on your credit report. Make sure there is no late fee associated with the unrated account as this can have a negative impact even if your listing is "Unrated". Creditors in all probability will agree to this condition.

• Paid Account: You can also propose the creditor to make your account as "Paid" rather than getting rid of it totally. If the listing shows "Paid Charge-off" or "Paid Repossession" it has a high negative impact. Request the creditor to just make it "Paid". A "Paid" listing on your credit report is most unlikely to hamper your credit score.

• Settled Account: In this case you may request the creditor to simply list the account as "Settled" rather than deleting the account totally.This listing status should be your last option because it is somewhat a negative listing.You should only say yes to this "Settled" status if the other negative listings like "Charge off", "Repossession", and "Collection" or "Late payments" are all deleted at the same time.However, one should work hard to delete the "Settled" status through the credit bureau dispute process.

• Paid Charge-off or Paid Collection Account: This status is equivalent as showing the same debt unpaid. It is quite common for an account to be deleted once the payment is complete.The creditor now has no interest to keep the negative listing on your report. Thus in most cases it is a good idea to settle the listing status even if the creditor does not take the initiative to delete the negative listing.