It’s an age-old tale. You open up a credit card, get a little too eager to use it, and then find yourself unable to make payments on it.
Now, with the United States plunged headfirst into an economic crisis due to COVID, more and more Americans are turning towards credit cards to help pay their bills, greatly increasing their overall credit card debt.
If you put off making credit card payments long enough, your credit card company will either sell the debt or enlist the assistance of a collection agency to get you to make payments.
This can lead to a new collections account appearing on your credit report, as reported by the three major credit reporting bureaus–Equifax, Experian, and Transunion.
If you have had Capital One send a bill to collections, you may be eager to remove the entry from your credit report, seriously impacting it.
Having a collections entry can affect your ability to borrow money in the future or secure lower interest rates even after you pay it off.
Luckily, it doesn’t take rocket science to get a collections account removed. It just takes a series of steps to get your credit report back on track.
What Happens if Capital One Sends a Bill to Collections?
Different card issuers have different policies when it comes to how long a customer needs to settle a debt before it goes to collections.
Some lenders will give you 6 months to settle your bill before they involve a debt collector.
Capital One is not specific about when your bill will be sent to collections, but your state of residence may have a hand in determining the timeline.
In other words, New York may have a different timeline than say, Montana.
When you’re late on a bill, Capital One can take a couple of different routes in the debt settlement process.
Capital One Charge Off
One of the worst possible things to have on your credit report is a charge off, which means that Capital One has sold your credit card balance to a collection agency.
It basically signifies that the company took a loss on the debt just to get rid of it.
Dealing with a charge off is slightly different than dealing with collections and requires a particular process.
Capital One Collections
Capital One will almost always send the bill to collections, which means that Capital One still technically owns the consumer debt.
You will likely need to deal with them directly in order to remove the entry from your credit report.
To find out if Capital One has charged off your debt or sent it to collections, you will need to acquire a copy of your credit report.
You will see either “Charge off” or “Collections” listed next to your Capital One entry. This will let you know which process you need to follow.
Collection accounts can remain on your credit report for up to 7 years, even after paying them off, so it’s imperative that you deal with them as soon as possible.
How to Remove Capital One Collections from Your Credit Report
Removing a collection account from your credit report can prevent headaches when it comes time to make large financial decisions.
Follow these steps to remove the collection account from your credit report.
Request Goodwill Deletion from Capital One
If you would like for Capital One to remove the collection entry from your credit report, try asking nicely.
The direct phone number for Capital One is 1-800-955-7070.
If you have already paid off the debt and would like for the entry to be removed, asking Capital One directly can sometimes yield results without the frustrating back and forth.
Explain the reason for your tardiness on your bill. If you had an extenuating circumstance, such as job loss or injury, they might remove the entry out of benevolence, even wave the late fees.
When asking for a goodwill deletion, be sure to be kind and truthful.
While a collection agency is more likely to delete a collection report if you missed your bill for a special circumstance, lying to them will not make your life any easier. If fact, it may work against you.
Again, this will typically only work if you have already paid off your debt. If you haven’t made any payments, your request will likely be ignored.
Make a Pay-For-Delete Agreement
If you are unable to make a goodwill agreement with Capital One, you will need to work out a pay-for-delete agreement with them.
This method will also work if Capital One has handed off the debt to a collection agency.
A pay-for-delete agreement offers payment on your debt in exchange for the collections account to be removed from your credit report.
This is typically how most people have collection accounts removed from their credit reports because it requires payment upfront.
Work with Capital One to come up with a payment plan and pay-to-delete agreement in writing, to hopefully prevent any judgments or bank account seizures.
Make an initial payment and check your credit report in 30 days. If the entry has not been deleted, remind Capital One of the agreements.
Continue to check your credit report until you no longer see the collection account listed.
Verify Information to Dispute
If you are concerned about the validity of the collection account or are otherwise unsuccessful, you may consider disputing the collection account.
You have the right to ask a collection agency to validate the debt under the Fair Debt Collection Practices Act (FDCPA.)
Be sure to send a letter asking them to validate the information within 30 days of your first contact with collections.
They will then be required to respond to you within 30 days. If they do not, you can file a complaint against them with the Consumer Financial Protection Bureau (CFPB) or the Better Business Bureau (BBB.org).
If there is incorrect information on the collection account, you could have the debt dismissed.
Look at the entry and keep your eye out for any information that doesn’t look right.
If you see any inaccuracies, you will need to file a dispute with the three major credit bureaus: Equifax, TransUnion, and Experian.
They will investigate and remove the entry if they can’t confirm the correct information.
You will need to provide proof, so hang onto any documents that list inaccuracies and note them as you see them.
Again, honesty is the best policy here, so don’t lie about any inaccuracies.
Work with a Professional
If you are too busy to handle the back and forth of dealing with a collection account, you can always hire someone to deal with it for you.
Credit repair companies like Lexington Law specialize in getting rid of collection accounts on your credit report and getting your credit history back on track.
They can also help you improve other areas of your finances that are hurting your credit score.
Before you hire someone, make sure you verify that the credit repair company is legitimate.
Some companies claim to help consumers but, in reality, are a total scam. Do your research and hire someone who is legitimate and impactful.
Credit history is important. Payment history accounts for as much as 35% of your overall credit score, and having a bill sent to a collection can derail your financial goals for the future, such as buying a car or a house.
It is important to deal with collection accounts swiftly. Through these guidelines, you can remove collection accounts from your credit report and get your financial wellness back on track.
You can prevent future collection accounts by developing good financial habits.
Use your credit card wisely by keeping track of purchases, paying your bills on time and in full, and not spending money you don’t have.
For more tips on how to improve your finances, check out some of our most popular articles for tips and guides.