If you’ve gotten behind on your utility or telecom bills, your utility company may have sold your account to Diversified Consultants, a collection agency.
Diversified Consultants may call you, send you a letter, or you may discover it when you check your credit report. Either way, a collection on your credit report hurts your credit score and your chances of securing new credit.
Fortunately, there are ways to remove Diversified Consultants from your credit report.
Validate the Debt
Before you do anything and within the first 30 days of Diversified Consultants contacting you, ask for debt validation.
In writing, ask them to verify your account and as many details about it as possible. This step ensures the debt is legit. Diversified Consultants is a legitimate company, but making sure they have the right to collect on your account is your right according to the Fair Credit Reporting Act.
In your letter ask the following:
- Who is the original creditor?
- What was the original balance?
- What’s the account number?
- When was the last payment made and in what amount?
- What’s the name on the account?
- Do you have the right to conduct business in my state?
Diversified Consultants has 30 days to respond to your validation request. If they don’t, they must remove the debt from your credit report. If they validate it, use one of the steps below.
Dispute the Debt
Next, dispute the debt. This requires you to write to the credit bureaus reporting the debt. If you didn’t pull your credit reports yet, you can get free access here. Figure out which credit bureau is reporting the debt and dispute the debt with them.
You can dispute any incorrect or unfair information reported on your credit report. Look for things like:
- The wrong account number
- A misspelled name
- The wrong balance
- Incorrect dates
If you don’t believe the debt is valid, you could use this method to fight the debt too. Provide the credit bureau with any information (proof) you have proving you don’t owe the debt. Like debt validation, the credit bureau has 30 days to investigate the claim and decide if the debt is legit.
If they find it’s not legit, they must remove it from your credit report. This is a great method to use if you miss your 30-day window to validate the debt. There’s no timeframe on how long you have to dispute a debt.
Arrange a Pay-for-Delete
Even if you had the debt removed from your credit report, you’ll need to pay it. Getting Diversified Consultants off your credit report helps improve your credit score and increases your chances of securing credit in the future, but you still must pay your debt.
Here’s the good news.
Diversified Consultants likely bought your debt for less than what you owe. This means you may be able to negotiate a lower payoff with them. Figure out how much you can afford to pay and negotiate with them.
As a part of your negotiations, ask for a pay-for-delete. This means they agree to delete the account from your credit report in exchange for payment. If Diversified Consultants agrees to it, get it in writing. Don’t pay them until you have the agreement and it’s in the amount you agreed upon.
When you pay them, only write a check – don’t give them your checking account number. When you write the check, you’ll have the written agreement (letter) from them plus the canceled check.
If they don’t hold up their end of the bargain and take the tradeline off your credit report, you can dispute the debt with the credit bureaus as discussed in the above step.
You don’t have to live with a collection on your credit report. There are several ways to remove it, even if the debt is legit.
You’ll have to pay it, and chances are you want to make good on your debt. But since it’s with a collection agency, you may be able to work out a better arrangement than you could with your utility company.
If you’ve fallen on hard times or it was a complete oversight, it’s okay. Collections happen all the time, but knowing how to deal with them so they are removed from your credit report is important. Letting a collection sit on your credit report hurts your credit score and your chances of securing future credit. Don’t let one slip up with Diversified Consultants be the reason you can’t get the credit you need.