How old is the account?
How much is owed on the account?
Can you make a settlement with the company?
How long is the statute of limitations in your state?
Is the account still with the original issuer or is it with a collector?
You will need to know all of this before you can decide how to handle it.
Yes, in case of a default, you should try and pay the past due amount as soon as possible. There is nothing you can do in the short term to recover your credit, but to make sure that you do not default again. However, as time passes and you keep up a good payment history, you should begin to see your credit rating improve. Also, if you have any other accounts appearing on your credit report as current, such as a car payment, other credit card, etc., these trade lines should exert a positive influence on your overall credit profile. You should also remember that as time passes, the negative impact of these old accounts on your credit rating will become less and less. Unless you are planning to make a large purchase, such as a home or vehicle, in the near future, this particular credit card default should not cause you many problems.
I encourage consumers to carefully review their credit reports from each of the three major credit reporting bureaus–Equifax, Experian, and TransUnion–at least once per year to make sure that all of the information appearing on the reports is accurate. You can obtain free copies of your credit reports once every twelve months by visiting www.annualcreditreport.com. Credit reports are notoriously inaccurate, and close scrutiny is required on your part to make sure that your credit report is current and accurate.
The Federal Trade Commission offers a free guide to disputing items on your credit report, available at www.ftc.gov, which may help you in cleaning up your credit reports.
Your personal details (name, email address and phone number) will be delivered to the company advertised on the Creditmagic after ve agreed to go for the counseling session by filling out the no-obligation form. However, it is your discretion to accept or reject their services.
Not all the creditors/debt collectors agree to trim down the outstanding balances, interests, and fees payable by the consumer.
Consumers working with the debt relief companies can still be sued by the creditors/collection agencies.
Debt relief services may have a diminishing effect on the creditworthiness of the consumer. The total outstanding balance may increase as the additional fees get accrued.
The overall amount saved by the consumer through the debt relief services is considered as taxable income by the IRS.