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How Do Collections work?

Collections are past-due and delinquent accounts that are transferred to a department or collection agency.

Collections accounts stay on your credit reports for seven years from the moment the account first went delinquent. The Fair Debt Collection Practices Act is a federal law that limits what a debt collector can say and do. The law requires a debt collector to send you a written notice within five days of contacting you for the first time with the following information:

  • How much money you owe on the debt,
    •    The name of the collector, and
    •    Steps you can take if you do not think the debt is yours.

And while newer versions of VantageScore and FICO scores ignore paid collections, many lenders still count even paid collections against you. If you do not think the debt is yours, TCC can help you dispute it within 30 days to the debt collector. If you dispute a debt, the collector must send written verification, such as a copy of a bill, before contacting you again to collect payment. TCC will write the necessary letters on your behalf to  remove the collection from your credit history.

It’s important to act quickly to remove collections from your credit report and start improving your credit.  Act now.


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