How to Get Settled Credit Cards Removed From Your Credit Report
Settled credit cards are debts resolved for less than the full balance. Some debtors settle credit card debts for 20 to 70 percent of the balance, according to a 2009 article published in "The New York Times." Settling a debt ends collection efforts on the account, but does not remove it from your credit reports, however. The Federal Trade Commission reports that options for removing settlement information from credit reports is very limited. The FTC reports that it's best to simply forget about settled debts and move forward by paying all current debts on time. Settled credit card accounts will have less of an impact on your credit score over time, according to the FTC.
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Instructions
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Obtain a copy of your credit report from AnnualCreditReport website, which is the only site that works with the three credit bureaus to offer you a free credit report under the terms of the Fair Credit Reporting Act, a federal law. Visit the site to print and read your report.
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Identify the settled credit card accounts you wish to remove. The account should list on the credit report as "settled" or "settled for less than the full balance." That's a negative credit entry that hurts your overall credit rating.
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Write a letter to the credit bureau asking for removal of settled credit cards whose last date of activity is more than seven years old. That's your only option for legally and ethically removing settlements from credit reports under the Fair Credit Reporting Act.
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Tips & Warnings
Negotiate removal of negative credit report information in advance the next time you settle a credit card account. A process called "pay for delete" allows creditors or debt collectors to remove the account entirely from accounts in exchange for payment. However, not all creditors or debt collectors will participate in such arrangements. It is not possible to pay the debt collector for removal of the entry after settling.
Credit repair agencies boast they can remove negative information such as settled credit cards but the FTC maintains they cannot do so without violating the law or committing unethical acts.
