You are negotiating with a debt collection agency or a bank, and would like to use a pay for delete letter template to negotiate that the item is removed from your credit report.

A Pay For Delete letter MAY work if the policies in place by the debt collector provide that service, but not all creditors provide it.

What is Pay For Delete?

A pay for delete is when a financial institution that is reporting to credit agrees to remove their trade line from the credit report if an account is resolved. Pay an amount to address a past due balance and the derogatory trade line of information tied to the account is removed from credit.

Please note that pay for deletes is a negotiation tactic for debt that is yours, but if the account is not yours then a free debt validation/dispute letter may help.

Pay For Delete Letter Template

Before you send a pay for delete letter template, it might be helpful to started to negotiate settlement. We created an entire guide on how to settle a debt for less on your own that may be helpful to read before using this template.

Just a quick note when settling your debt, it’s vital to understand what percentage to offer for the debt settlement as this may be one

When you have an offer, this is when you may want to use the pay for delete letter template. In the template, you can state what has been discussed and then request that if you accept the terms of the settlement then the creditor would be obligated to delete the settlement.

The goal of the pay for delete letter may be that the debt collector will add that it will pay for delete to the settlement agreement. If not, you may want to make sure you get that in verbal commitment.

Without further ado, here’s the Pay for Delete letter template that you can make a copy of by clicking here.

Once settled, you also may want to make sure you know what to look for in a settled: paid in full letter.

Will My Creditors Actually Delete The Credit Line If I Settle the Account?

It really depends on the creditor whether they will delete the credit line when you pay off the settlement.

As such, we built one of the most robust pay for delete creditor databases that provide information such as whether a creditor will say it will delete the credit line when settled, and whether the company actually follows through and deletes the line.

In addition, the database will also provide whether the collection agency will put it in writing, and how exactly it works (i.e. if debt is more than 2 years old, then the collection agency may pay for delete).

6 Crucial Things You Definitely Need to Know About Paying For Delete

At Ascend, our goal is to help people get out of debt cheaper, easier and faster, so we spend quite a bit of time understanding how pay for delete works.

As such, here are 6 crucial things to know about paying for delete.

1. All medical collections that are showing on a credit report are now removed once the credit bureaus receive confirmation the account has been resolved. The reporting can take up to 60 days, but you can be confident your medical collection will be deleted if paid in full or settled.

2. Many large 3rd party collection agencies or debt purchasers (Portfolio, LVNV/Resurgent, Midland) will now negotiate pay for deletes on almost any account in their office. Sometimes settlement percentages can be higher based on the age of the account, but success rates are way up on pay for deletions if a 3rd party has purchased your debt.

3. Charged off accounts that are still owned by a bank and have not been sold to a 3rd party are unlikely to be removed. Most of the time there is still benefit in resolving these accounts even if they are not deleted, but don’t expect a large banking institution to negotiate pay for deletes if they still own the account.

4. Utility bills, cell phone bills, insurance debt are all really 50/50. Some collection agencies will agree to delete, while others will not for the same type of account. Example, Credit Collections LLC in Massachusetts will not delete progressive insurance collections, but Caine and Weiner may. This is just one example of why it’s best to contact the collection agency to find out what their policy is before resolving a collection.

5. With most lending scoring algorithms (auto, credit card, mortgage) it is only beneficial to resolve a collection if the collection agency agrees to remove the account. Just paying a collection without deletion often does not benefit scores or lending potential. Exceptions are resolving collections can benefit DTI or underwriting overlays but won’t benefit credit scores in the long run.

6. Verizon collections may be one of the exceptions to this rule as well. If a Verizon collection is paid but not deleted, there is still benefit within the scoring models. Verizon, T Mobile, Sprint etc. may sometimes still agree to pay for deletion depending on what type of debt is owed. If a past due balance was for a last month of service or disconnection fee, the creditor is more likely to remove. If the past due balance is for a cell phone you still have, they will play hardball.

Summing It All Up

A Pay For Delete letter may be helpful, but it may not be helpful if the creditors policy does not allow that your credit line gets deleted when settled.

As such, it can be helpful to understand whether a creditor will do pay for delete before starting the negotiation process.