When you first received your very first credit card statement, someone close to you should help you to understand that a credit card is a valuable tool to gain credit for the only purpose of being able to borrow money for future investment purposes. Somehow our way of thinking has been mislead to use the card to spend money we don’t have. So, we should only spend what we know we can pay back within the next 30 day billing cycle.

Having good credit is very important. It will determine how much you pay over time for almost all major ticket items. Having the best possible score will get you better rates on credit cards, car loans and/or mortgages. In fact having a good credit score could even affect getting a new job or signing an apartment lease.

When you get a charge off on your credit report it will negatively impact your credit score. This comes about when an account becomes delinquent and no payment is made for 6 months. To delete charge offs from your credit history you have to dispute the charge off. You can do this by sending a credit repair letter to the credit bureaus. Do a google search online and you will find who they are if you are not too sure. They are Equifax, Experian, and TransUnion LLC.

In the credit repair letter you need to include the reason the charge off should be deleted. Reasons often include: the account being paid, never paid laid or it's not your account. Now, the way our credit system works is you are guilty until you prove your innocence.
What I mean is the incorrect information is true until you prove differently. In response to incorrect information being reported, congress passed the Fair Credit Reporting Act. This says that any listing that can not be verified must be removed from your credit report by the credit bureau.

It is also common for one charge off account to become many negative listings and ruin your credit score. Let me explain what happens to an account once it is charged off. The delinquent debt is sold to a collection agency by the original lender. Then the collection agency tries to collect payment from you. If they can not then they will report a new negative listing on your credit report.

Then this collection agency will sell your debt to another collection agency. The new collection agency will also have the authority to create a negative listing if they can not recover payment. This process will continue through any number of collection agencies.
It depends upon the size of the delinquent account. You can see how one account can ruin your credit score and turn into multiple negative listings.

By preparing your credit before a major purchase, you can ensure a smooth financial process and can potentially save thousands of dollars on fees and rates. There are services available such as credit repair companies who can help you remove bad marks if you
have many negative listings it will cause your score to go way down. It will also be difficult to get approved for new lines of credit. In sum, I encourage you to dispute the listing before you make payment. I would do this because making payment does not guarantee the listing will be removed.