Negotiating with Creditors to Save Your Credit

While working to clear up your credit, in cases where your story conflicts with the reporting creditor, the bureau is going to side with the creditor--unless you have strong documentation of the error. The bureau will inform you that their reinvestigation is complete and if you disagree with the outcome, you can record a 100 word statement telling your side. You are a long way from done, however. Such a statement is to concede defeat. You still have a few more punches to throw.

[Excerpted from Fresh Start: The Authoritative Guide To Consumer Credit Repair.]

These additional methods are disclosed with two assumptions: a) the reader is a person of integrity and would not use these methods to commit fraud, and b) the reader is working with very limited financial resources, and must get the maximum return in exchange for dispersing those resources to numerous creditors.

Vital Assessment of Your Situation

If you have a little cash to throw at your credit problems, you should be able to make good progress with negotiations. Negotiating with the original creditor creates a win-win situation where the creditor gets a good chunk of the principle back, and you get an improved reporting of the debt in your file, plus a reduced settlement in many cases.

NOTE: You must negotiate with the firm that reported the item on your credit file, be it a collection agency or the original creditor. Only they can change the reported status of the account. To negotiate with the collection agency is a waste of time unless they are the name on your file.

Negotiations will take some cash to accomplish, but the good thing is it's a permanent fix. And it is the most ethical if there is money still owed.

When evaluating your options and the firmness of your negotiations, there are several factors that you need to consider.

Vital Assessment | Accuracy and Proof

First, look at the accuracy of the information. If you can prove the information is incorrect with your documentation, then you can afford to be very firm in what you demand.

On the other hand, even if the information is incorrect, but you can not document that fact, then you must take basically the same negotiating position as you would if you were attempting to remove accurate, yet negative, information. That would be to posture yourself as an amicable, good person trying to overcome the aftermath of negative circumstances through negotiations. In other words, you are trying to go back and, to the best of your ability, historically undo a very difficult time in your life.

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