|
|
Re-Aging A Credit Account - What Is It? How Do I Do It?
|
|
|
One technique for fixing your credit report and improving your credit scores is called re-aging your credit accounts. This technique is especially helpful if you had only a short term problem, such as a brief job layoff, and you are now back on firm financial ground again.
What is re-aging? When a creditor re-ages your account they remove from your account negative information surrounding late payments from your credit report On the information that they report to the credit reporting agencies (credit bureaus) they will simply remove any indication of late payments and mark your account as “current”. That’s right, if you can get your creditor to re-age your past due account you will see your account history go from delinquent to good standing. The result of this on your credit report could result in a dramatic jump in your credit scores.
If you think about it, getting a creditor to change their information about your account from “bad” to “good” might not be as easy as it sounds. You borrowed money from them and then broke your agreement to pay them back. Put yourself in their shoes and you loaned someone money and they stopped paying you back. How would you feel about it? Well, how would you feel if the person who you loaned money to asked for a second chance because they did not pay for a while because they had a bad car accident and were out of work for 6 weeks?
Now, go back to your situation, if you are going to ask your creditor to re-age your account approach them with two things. First, go to them with a good reason as to why you got behind coupled with being able to tell them that you are back on stable ground again. Always remember, you are going to be talking to a human being with their own set of circumstances and life, so the more you speak to them like they are a human, the more likely you are to get them to agree to your re-aging request. Second, make sure that you are able to demonstrate that you are back on your feet again by having a lump sum of money that you can use to negotiate with them. Remember the phrase – “money talks”.
If the creditor on your account agrees to re-age your account while you are currently past due, try negotiating any fees and penalties that you owe. You might be surprised what they will do if you have cash to pay right away. However, you will probably have to pay the full amount of money that you owe on your monthly payments. If you cannot pay them completely in one lump sum payment, offer to partially cover what you owe past due and then make extra payments above your minimum payments until you are either caught up or paid the account to $0. One tip - your account’s re-aging will stay in place as long as you do what you say you are going to do – do not miss a payment.
Believe it or not, US Federal Regulations govern credit account re-aging eligibility (See other US Laws that affect you as a consumer and you credit). Briefly, you and your accounts must meet these criteria in order to able to be re-aged.
• You must show your ability and willingness to pay the account as you agreed.
• Your account must be at least 9 months old
• If after your account has been delinquent you make at least three consecutive payments on time as agreed, or you have the money to make a lump sum payment to equal three monthly payments combined.
• You have not already re-aged the account that you now want to re-age in the past 12 months.
• You are not given any additional credit until your balance falls below the balance you were at when your account got behind.
If you and your accounts meet these requirements and you are committed to making your payments on time again then you might have a good shot at getting your creditor to re-age your account. Again, do not miss a payment if you get them to re-age your account. Prepare a letter to send to the creditor requesting that they re-age your account.
In that letter make sure you spell out what happened that got you into the mess you are in with them. Spell out to them why the problem is resolved and that you are on heading up again. Also, make your proposal as these initial steps of negotiating with them. And at last, request that they put their offer in writing so that you have proof of what they say they are going to do for you. If they will not give you anything in writing, either ask to speak to a manager, or call back and speak to another customer service representative, or wait a month – make another payment – and try again.
More tips on how to improve your credit and credit scores
Written by GetPreQualified.com editorial staff.
This Article is designed to be of general interest and should not be considered legal advice. The specific information discussed may not apply to you. Before acting on any matter contained herein, you should consult with your personal legal adviser.
|
|
