Legal Question in Credit and Debt Law in North Carolina

Simple answer: you CANNOT get this removed from your credit. Any company that claims they can do it is possibly doing something shady. You can have inaccurate items removed, but if you signed the lease and your roommate didn't pay, then you are unfortunately liable just as he is unless he pays. This would be legitimate on the credit report. What some companies do (I know nothing of Lexington Law's procedure, but will say that only non profit agencies or licensed NC attorneys can do this work in NC without the possibility of a crime occurring) , they will file a dispute as to the item in question and then send you a report with the item removed...what you don't get is the corrected report when the debt is substantiated and put back on the report.

When you settle with the creditor, they will note the account paid in full, which is helpful, but they lied if they told you they will remove it from the credit report. They have no power to tell the credit bureaus to do so.

Attorney Love is right. You cannot get this legally removed from your credit IF this is a debt for which you are responsible.

However, there is legal and there is .... quasi-illegal. I have heard of cases where a debtor pays in full and the creditor takes off the item. And I have had situations for clients where things just went south and it really wasn't the debtors' fault that the debt went delinquent and I asked nicely and the creditor agreed to take it off but that was because of the special circumstances in that case.

You can hire a lawyer if you want ... me or anyone else but I would not recommend Lexington Law. For one thing, they are not licensed in NC to my knowledge and if they are practicing in NC then its unauthorized practice of law. However, the debt is small and you want to get out of this as cheaply as you can. You can settle this yourself and do the dispute letters if needed if you do it correctly.

First thing - debt collectors LIE! All the time. They can say anything to get you to pay including promises of removing the debt.

Why exactly did this end up on your credit and why did you not pay it before it went into collections? Did you and your roommate both sign the lease? Did the lease provide (if you know) whether you and your roommate were jointly and severally liable? By this I mean that if either one of you did not pay then the landlord can seek recovery of the back rent from either of you. Or did the lease just provide that you would solely be liable for your share of the rent and your roommate for his share? If the former, then why didn't you pay? If the latter, you are not liable at all and in that case this debt can be legitimately disputed. You first have to dispute it with the credit bureaus and then with the debt collector if the credit bureaus refuse to remove the debt. The dispute must be in writing and sent via certified mail. If you have proof that you are not liable and you dispute this properly, then you can sue for damages and recover attorneys fees - which will be a lot more than the debt owed.

To the extent you are liable for the debt but can make a reasonable argument why you were not at fault here (or if you can show how the landlord messed up too), maybe you can get this removed if you pay the creditor. Even if you cannot get the item removed legally, then I still would settle the debt for whatever is a fair sum if you are legally responsible for the debt. However, get a settlement letter in first indicating that the full amount of the debt is $700 but the collector will accept $480 as settlement in full and that after paying this amount there will be no further collection activity on your account and that the debt will be reported as "paid settled" to the credit bureaus. Send the payment via money order or bank certified check and keep a copy of it before you send. Follow up in 30 days to get a closure letter acknowledging receipt of the funds and that you owe nothing more and that your credit report will be updated. Keep the settlement letter, closure letter and copy of the settlement FOREVER. Seriously. Debts have a way of re-surfacing - I call these "zombie" debts. You want proof in case that happens. Send the payment via UPS or FedEx so you can prove that the collector got it too. I have had problems with the USPS and certified mail.

After 7 years, this debt will drop off your credit report. However, unless this is the only black mark on your credit, the more time that passes the less this debt will affect you. There is a score simulator at www.myfico.com somewhere and you can see what your credit score would be if this debt was not on your report. You also can add a 100 word statement to your report - about this debt. I don't know how much weight this will carry with lenders. Car lenders will not care and still loan you the funds. Mortgage lenders are going to want this debt paid off before they lend money.

I am familiar with Lexington Law - from what I know - they play what I call the "credit report dispute" game. By this I mean they take your money and send a dispute letter to the credit bureaus and hope that the creditor does not verify the debt. If that happens, the debt is removed from your credit report. If the debt is not resolved, the debt can be re-added by another debt collector or junk debt buyer though. I would recommend saving your cash rather than spending it on Lexington Law.