Dear Clever Credit,
I had a credit card with a bank that also happened to be a previous employer. Their website was weird, and I thought they had closed my account because I paid the card off and didn’t use it for a while. I vaguely remember getting something in the mail saying that they were switching my account to some other random bank.
I never activated the card or anything, and I kept meaning to call them to make sure to close the account. But I unexpectedly lost my father, and my mental health was not great, so I kind of forgot about it.
Well, all of a sudden, I’m getting calls and letters saying I have a balance on that account/card I never activated. I don’t know if it was a service fee for something because it was only $13, but by ignoring it, they kept tacking on late fees.
After just a few months, they closed the account, and it just recently tanked my credit and says I owe $90. I’ll pay the $90 if I have to, but I wanted advice before that.
Do I have any validity in saying this is not my debt because I never used the account? I’m assuming there must have been something in the contract with the original bank/credit card that said they could transfer my account to a different company.
I know I have to talk to them to get specific information, but I don’t want to own up to anything on a recorded line until I know my options. Should I just ask for a pay-for-delete?
Signed,
Desperate for Delete
Dear Desperate,
Things happen! What’s important is knowing how to bounce back from them. So let’s get into it.
It’s unfortunate you were hit with a $90 bill. You’re right, this was most likely an initial service fee of some kind connected to the credit card, which then started accruing late fees. Not activating your credit card can certainly have unintended consequences. And this is one of them.
[Read: Best Credit Cards.]
In most cases, you have about 45 to 60 days to activate a credit card, depending on the issuer. And normally, if you don’t activate it, the issuer will close the account due to inactivity. But if there are fees associated with the card, that complicates things just a smidge. Because you will still get charged any fees, even if you don’t activate the card. Annoying, I know.
Now, that doesn’t mean you have to just shrug and pay the $90. You can try disputing the item with each of the three credit bureaus first. I’ve done this before, myself, and it’s rather easy, but you do have to be patient. You can do this online, on the phone or through the mail, but online is much easier. Just remember you’ll have to file a dispute with Experian, Equifax and TransUnion. You’ll need to argue your case and provide any evidence (like supporting documents), and then wait. Each credit bureau will review the dispute, and you’ll have its response in about 30 days (sometimes sooner if you’re lucky).
If that doesn’t work, then yes, you will need to pay the $90 and request a pay-for-delete. However, it’s not guaranteed that you’ll get one. A debt collector can refuse to remove the item from your credit report if it’s technically reported accurately. Plus, pay-for-delete only applies to the collection account. It won’t remove the negative information reported by the original creditor, which stays on your credit report for seven years.
[SEE: Best Credit Cards to Build Credit]
It’s important now to keep an eye on your credit report. Get into the habit of checking it once every couple of months, just a quick glance to make sure nothing’s out of the ordinary. Especially if you’ve just applied for a credit product.
I’m sorry you’re having to deal with this during a tough time in your life, but hopefully your credit will be back to normal soon!
More from U.S. News
When Does My Credit Card Report to the Credit Bureaus?
Can I Declare Bankruptcy for Credit Card Debt?
How Often Should I Check My Credit Report?
I Forgot to Activate My Credit Card. What Should I Do? originally appeared on usnews.com