Please help me fix my credit report!
December 1, 2008 2:14 PM   Subscribe

After ordering my credit report, I found that there were two bills sent to collections in 2006. Upon further investigation, I discovered that these were for unpaid cable bills and cable equipment that was never returned by my old roommates after I moved out--what do I do?

My credit report lists two amounts sent to collections (one for about $40 and the other for $250). When I called the listed collections agency, I found out that the $40 was for an unpaid cable bill and the $250 for cable equipment that was never returned after the account was closed.

However, I had not lived in the apartment in question for a year at the time of these bills. I had moved to another state, and my two remaining roommates stayed in that apartment for another year. I was almost certain that we had changed the name on the cable bill from mine to theirs, but apparently we either forgot to do so, or the cable company screwed up and never changed the name per our request.

One concern I have about paying the bill (or getting my former roommates to pay it) is that I heard paying off a collections amount can actually further hurt your credit score, as the "paid collection" notation stays on the report longer.

So, my question(s): Do I pay the bill or try to get my roommates to pay it? Do I ignore it? Do I contest it somehow (and if so, how do I go about doing this)? Any other suggestions?

posted by mingodingo to Work & Money (7 answers total) 4 users marked this as a favorite
It's stupid that they took you to collections for $40.

There is a lot of information on the internet about "debt verification". (Here's a starter link.) I might start there if you are sure your name is no longer on the account. The principles are basically forcing the collection agency to prove to you, in writing, that you actually owe the debt. Since you haven't been contacted, I would say that they probably aren't going to pursue you.

I would spend some time reading up on this principle, and then decide what you want to do.

I'd probably want the debt resolved. If I was in your shoes, I'd pay it, and then ask for the money back nicely once. If I didn't get it, I'd sue the roommates in small claims court. Don't try to force the roommates to pay it. Pay it yourself now, get the debt resolved, collect it from them later.

Two small amounts like this are not going to majorly impact your credit score. When I worked in a business where we pulled credit reports constantly, the two things everyone expected to see were bad cell phone debts and bad cable debt. 95% of the time, no one took those seriously (unless we were talking about people who just didn't pay their bills, period). Everyone has a problem with these companies at some time or the other.
posted by micawber at 2:27 PM on December 1, 2008

Try calling the cable company and explain to them what happened. Be polite and admit fault and tell them that you intend to pay the bill, but is there a way for them to take it off your credit score once the payment goes through. If it doesn't work the first time, I would call again and talk to a different representative.

I had to deal with something similar when I moved out after college. The lesson I took away was to cover my own ass and cancel the cable and return everything.
posted by spec80 at 2:30 PM on December 1, 2008

Two small amounts like this are not going to majorly impact your credit score.

I can personally attest that this is not true, while we were buying our house a collections agency suddenly showed up on my wife's credit report saying she had a $12 unpaid electric bill from years before. This immediately dropped her credit score (aka FICO score) by 100 points and disqualified us from the best lenders. Some lenders require that you have a minimum FICO score before they'll even bother to pull up your credit history to see if they can give you any leeway.

That said, I agree with everything else micawber said. You should start reading up on verification letters (aka validation letters). It'll probably take a couple of evenings of research before you're up to speed, but it's worth it in the long run. The place that helped me the most when I dealt with the problem my wife had was
posted by TungstenChef at 3:02 PM on December 1, 2008

I almost forgot, don't talk to the collections agency on the phone until you've learned more about the collections process and your rights. They will be recording all phone calls, and may try to get you to admit to things you don't realize could hurt you later. If they start calling, be polite but firm and say something along the lines of:
"I'm not able to discuss this right now, and am requesting that you send all further communications to me by mail."

They're required by law to honor this request.
posted by TungstenChef at 3:13 PM on December 1, 2008

Ditto TungstenChef: My husband had a charge from the utility company go to collections for $9.11 (nine dollars! and eleven cents!) when he didn't realize that he had a balance after the last bill he paid in a temporary apartment when we moved across the country. I *really* wish that I would have tried to get them to pull it off his report, but instead we just paid it as soon as we figured out (no collections agent ever bothered to call for $9.11, so it sat around for a while). It'll now continue to be there for several more years.

The effect on his score has had ripple effects on various aspects of our financial life ever since. It's really, really lame, but it is what it is - and it can be a problem if you don't deal with it.
posted by handful of rain at 4:59 PM on December 1, 2008

Response by poster: So does the cable company have any power to have the collections notation removed from my report, or is it out of their hands once they've send it to collections?

Thanks for all the responses, btw!
posted by mingodingo at 5:13 PM on December 1, 2008

So does the cable company have any power to have the collections notation removed from my report, or is it out of their hands once they've send it to collections?

Yes, they do. I'd contest the charges with the reporting agency too. If your cable company is anything like my cable company, there's a fair chance they won't be able to find the supporting documentation for the "debt" anyway.
posted by meta_eli at 7:39 PM on December 1, 2008

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