As we pointed out in a previous success story, three of the most detrimental elements that can appear on your credit report are late payments, collections, and charge offs. Richard H. had all of them on his when he hopped on the CredEvolv platform.
The certified, nonprofit credit counselor he connected with through CredEvolv was able to remove late payments, a collection, and a charge-off from Richard’s credit report, raising his score from 526 to 595 in just 4 months!
You probably know or can figure out what late payments are. Here’s a refresher about the other two:
What are collections and charge-offs on a credit report?
- A collections account happens if you fall behind on payments and the lender or creditor decides to transfer your account to a collection agency or sell it to a debt buyer. This can occur anytime from the date you begin missing payments or not paying the full minimum payment to a few months after you become delinquent. Lenders and creditors will usually send you letters or call you regarding the debt before it is sent to a collection agency.
- A charge-off happens when the creditor doesn’t think the debt will be paid back. Even though the creditor has written the debt off and has stopped attempting to collect the debt themselves, if a collections agency has purchased the debt, it may attempt to collect what you owe (which can include the outstanding balance and any interest that has accrued).
Next on the list: addressing another collection and pushing Richard’s credit score into the 600s!
Read more credit success stories here.