Dealing with collections on your credit report and then attempting to deal with collection companies can be one of the most frustrating, exhausting, and daunting tasks when trying to improve your credit rating or score. In today’s blog post, we are going to give you all the basics about collections and collection agencies so you are prepared to have collections removed from your credit report. Once you are comfortable with the basics of collections head on over to http://aaacreditguide.com/collections/ to learn everything you need to know about how to remove collections from your credit report.
What are collections?
An account on your credit report that says it is in “collections” indicates to a potential creditor that you have a debt that was not paid in accordance to the terms of the credit agreement. This is obviously not something potential creditors want to see, so in order to improve your credit rating you will want to minimize or eliminate as many collections as possible from your credit report.
What is a collections company?
If the debt is or becomes significantly past due or delinquent the original creditor or company you had the credit arrangement with will most likely sell the debt to a collection company or agency. The collection company usually buys the debt for pennies on the dollar so if your debt is sold to a collections agency you will often see a charge off from the original creditor and a collections notation from the collections agency on your credit report. These types of marks on your credit report will cause your score to plummet.
What to do about collections
Okay, so now you know what a collection is, what a collection company is, and you want to do something about collections affecting your credit. The next step you need to take is to figure out how to remove collections from your credit report. Luckily for you, AAACreditGuide has already done the research for you. Hop on over to their blog post at http://aaacreditguide.com/collections/ and learn how to take the first step in having collections removed from your credit report.
Now, you know the basics of collections and you are ready to remove collections from your credit report. Best of luck to you on improving your credit score by having those collections removed!
What one piece of advice do you wish someone would have told you about credit before you opened that first account? We’d love to hear your experience in the comments below.