In the last post, we covered how to quickly clear credit card debt while maximizing your credit score throughout the process. Before I continue, I want to cover how to quickly clear debt that isn’t revolving debt like credit cards, in other words, mortgages, installment loans, student loans, etc.
Speaking strictly from a credit restoration perspective AND NOT A FINANCIAL PLANNING OR BUDGETING PERSPECTIVE, you do not want to pay off mortgages, installment loans or student loans earlier. The reason for this is from a credit restoration perspective, you want the loans to season as long as possible, which means, to report on time payments for the longest period possible. Paying them off early, is NOT good for your credit score regardless of what you may think. Credit cards yes, mortgages, installment loans and student loans, no. Having said that, we will address numerous techniques to eliminate these types of debt early while still maximizing your credit score.
For now, most of you want to know how to clear debt that is either positively reporting credit card debt or negatively reporting debt of any kind. So, let’s discuss how to quickly erase and clear debts that are negatively reporting. There are different strategies for each type of debt and different systems that must be followed depending on the type of bad debt you are dealing with.
So, let’s start with the easiest and most common forms of bad debt first and I will give you some clear debt solutions.
Collections & Charge-offs
- If you have a collection or charge-off or are in credit card default, the initial response most people take to erase debt of this kind is absolutely the worst and most expensive method, and that is, they mistakenly pay them off. To quote Julia Roberts in Pretty Woman, “Big Mistake! HUGE!”.
- Debt Validation- for collection accounts with a collector
- 6-2-3 Method- for charge-offs with the original lender
- Pay For Delete- used as a last resort with either a collector or lender.
- Perhaps my favorite method is the Debt Validation method because it truly puts the power of the law and legal system in YOUR hands to help you clear debt quickly and end the harassment from collectors. Using this method, we recently got a legitimate $16,000 collection account removed from a family member’s credit report. Doing this enabled her to immediately qualify for a mortgage and she closed June 1st. Know what we had to do to accomplish this? Send one simple letter. That’s it. Pretty powerful stuff, huh? If you want to watch the video and get the actual letter we used to do this, simply click on the following link: How To Clear Debt With The Debt Validation Method.The 6-2-3 Method is similar but must be used with the original lender. I like this method because with all of the recent takeovers, acquisitions and bad systems that most of these lenders have in place, most of the time they do not stay in compliance with the law. Understanding this and utilizing the 6-2-3 Method, you can force their hand and legally require them to remove the charge-off from your credit report AND cease all collection efforts for the balance owed (since they cannot legally prove that you owe the money). This is a very effective method and all it takes is knowing the law and one simple letter. In the Members Only side of Credit Repair College, you can access the law in the Law Library, access the letter in the Other Training Materials section and understand exactly what you need to do by watching the video in our Video Training section. To see what you get access to on the Members Only side, simply click here: Clear Debt FastThe Pay For Delete Method is the last resort if the aforementioned methods don’t work. Using this method, essentially you will negotiate with the collector or lender to pay off the collection or charge-off in exchange for complete deletion of the account from your credit report. This has to be done in a very systematic way and you MUST get the correct documentation BEFORE you pay off anything otherwise they will simply collect your money, not do anything, not remove the account from your credit report and you will have no recourse. This is a highly effective method to clear debt and remove derogatory credit but it requires a very specific method to accomplish successfully. We teach this method on how to clear debt fast on the Members Only side as well with actual recorded conversations with collection agencies so you can hear what you will deal with and know how to handle the situation properly.Next up in our series on how to quickly erase debt and clear debt fast: How To Make Quick Cash so you can avoid collection accounts and charge-offs and get out of revolving debt faster. Stay tuned for more strategies on how to clear your debt!
Why is that?
Because paying them off only accomplishes paying them off. The same goes for consumer debt settlement unless it is properly negotiated. It doesn’t do anything positive for your credit report or score. And, paying them off refreshes the date of last activity so you get the added insult to injury of having a paid collection or charge-off on your credit report for an additional 7 years. Doesn’t sound like what you want, does it?
What you want is to erase and clear debt of this kind and have it completely removed from your credit report, ideally, in the least expensive way possible. So, how do you do that?
Collections and charge-offs can be completely eliminated using the following methods:
No matter what your credit situation we can help you! Remember, knowledge is power and on the inside of CreditRepairCollege, we will teach you everything you need to know about credit restoration! Our curriculum includes: dealing with student loan default, insider secrets on getting poor credit auto loans, how to decide if Christian debt counseling is right for you, how to navigate consumer debt settlement and more! Enroll now!