Derogatory marks on your client’s credit report — like late payments or bankruptcies — can last the better part of a decade. For every year your client’s report has a ‘red mark’ on it, it’s another year of financial difficulty.
As a credit repair specialist, there are several approaches you can take to remove these marks from your client’s credit report, one of which is the pay for delete letter.
Credit Repair Cloud Millionaires Club member and credit repair business owner Derrick Harper shared advanced dispute tactics at this year's Credit Repair Expo in Orlando, FL.
This guide will cover what a pay for delete letter is, and when it’s the best option for you to pursue for your clients.
Can the Client Affordably Pay the Debt?
Before sending a pay for delete letter to the original creditor, perhaps the most important thing to consider is whether your client can afford to pay the debt.
A pay for delete letter is essentially a request, sent to the creditor or a collection agency, to remove the negative item in return for the debt being paid in full. So, before sending the letter you need to ensure your client can do just that.
Here, you should assess your client’s current financial situation — would paying a lump sum to settle the debt improve their financial situation? Or would it require them to incur additional debt?
Another alternative is to send a pay for delete letter to a collection agency and offer to pay less than the full amount. Since the agency likely bought the debt from the original creditor for less than its original value, they may be prepared to accept a lower amount as long as they still turn a profit.
Is Your Client’s Credit Report Awash with Negative Items?
Another factor to consider when sending a pay for delete letter is the number of negative items on your client’s credit report.
If they have quite a few, it may be worth considering a Round one credit dispute letter rather than a pay for delete letter. Round one dispute letters:
- Can include up to five items and is sent directly to credit bureaus
- Points out inaccuracies and requests the removal of these errors
- Can result in the removal of erroneous items by the credit bureau
With strategy, diligence, and a well-crafted template, it’s possible that several of the negative items will be removed. This helps reduce the negative information on your client’s credit report without them having to pay for the deletion.
This way, you can save the pay for delete letters for more heavily weighted items in the report.
What if the Pay for Delete Letter is Rejected?
Pay for delete letters aren’t a magic bullet and they can be rejected. For instance, if the creditor rejects the settlement offer, or sees no reason to comply with your terms, the pay for delete letter may be fruitless.
However, that doesn’t necessarily mean the end of the road.
A good next step is to dispute the rejection with the credit bureau directly. You can send a debt validation letter which demands verification of the debt. With this letter, you are essentially asking the creditor to prove the debt is valid.
If the creditor can’t validate the account in time, it will be removed from the report. You can do this as many times as needed.
Repeating the process is especially seamless with Credit Repair Cloud’s software, which helps credit specialists how to keep track of when to submit again, and when to follow up with clients and bureaus. It also makes it easy to auto populate letters to send back to the bureaus.
How to Write a Pay for Delete Letter
If you decide that a pay for delete letter is the best option for you and your client, putting one together is a straightforward process – especially with the help of Credit Repair Cloud.
There are a few simple steps to keep in mind when drafting the letter:
- Be clear about the negative items you want to be removed
- Clearly state how much you are prepared to offer as payment
- Be specific regarding dates and installment intervals
- Don’t pay anything until you’ve received a signed letter back confirming that the creditor has accepted your terms
A sample pay for delete letter can be a really useful tool when working out how to proceed. For an idea of how to draft a pay for delete letter that works, download our pay for delete letter template here.