Can an Account in Collections Hurt my Credit?
If you have not been able to pay your bills for a long time, an account in collections will decrease your credit score significantly. It generally depends on how high of a credit score you have when the agency reported your debt. However, the higher the scores are, the more credit points you will lose.
It’s essential to know how a bill in collections can hurt your credit. Since having your account in collections is devastating to your credit score, it is extremely important to find out how you can avoid it, or what options you can use to deal with the problem.
UmbrellaDEBT Relief can explain your options to get rid of debt. This certified company is one of the best choices to seek relief from unsecured debts in credit industries. We offer debt settlement programs to reduce debt balances instead of just decreasing interest rates.
If your account is indicating ‘Bill in Collections’ or you are struggling to break your debt cycle, UmbrellaDEBT Relief can help. Many people find that we offer the most appropriate and least expensive debt relief solutions for consumer debt.
What is “Bill in Collections’ and How Does it Affect Your Credit?
As stated above, a bill in collection typically refers to a situation that occurs when an account holder has not been paying his/her bills on time. Whether it is a medical bill or credit card bill, becoming delinquent on debts means the original company owns a right to consider this debt as a loss. As a result, the original creditor or company can sell the account to any collection agency to recover the debt amount.
Know that different lenders work with different debt policies. For many creditors, when your debt goes unpaid for 30 days, your overdue amount may be reported as delinquent. After 180 days, however, the creditor may decide to “give up” trying to collect the money you owe them. It’s at that point that the creditor may sell the debt to a collection agency to recoup some of the money lost. If your debt does get sold to a collection agency, you will begin to get calls or correspondence from the new company. It’s the same debt that you previously owed, but it will be paid to this new company. At this point, either the collection agency or original creditor reports ‘bill in collections’ to the authority or a credit bureau. That is when the bureau marks your account with a ‘collection’ status on the report.
Once marked with a collection status, you need to know that it will remain on your credit report for seven years. And some unpaid collections accounts may actually lead to you being sued. So, in addition to a lower credit score, you could find yourself on the opposite side of a lawsuit.
How UmbrellaDEBT Can Help
Seeking help from a professional debt relief company like UmbrellaDEBT is the best way to deal with unpaid debt. Working with UmbrellaDEBT, our professionals can work with your creditors and negotiate, communicate, and ultimately settle your outstanding debt. Our debt counselors will work to explain your options pay the reduced balance over multiple payments or in a lump sum amount.
We can be your ultimate solution to settle your unsecured debts. Contact UmbrellaDEBT Relief to find out how our relief programs can help you reduce or decrease debt balances and build a secure financial future.
