Question: I have a question on settling a debt with a bank from 2008. I ordered a report from Chexsystem and I hadn’t realized that I owed HSBC $130 from 2009 and I have been on the Chexsystem for that long.
I would like to approach HSBC on paying this debt and getting removed from the system but don’t know how to do it. Do I make them write me a letter we are settling this debt and that they will remove me from Chexsystem? Can you please give me advice?
Answer: You certainly may request the bank remove your Chexsystems record in exchange for payment but the bank is under no legal obligation to comply with your request. You cannot make them do anything.
Your situation is not uncommon as many consumers switch or close bank accounts without knowing an amount is owed on the account. The bank should have contacted you about the amount owed on the account. If they did not or you moved and they could not contact you this may be a good reason to request a pay for deletion.
I suggest writing a goodwill letter to the bank requesting in exchange for payment, they remove you from Chexsystems and any other consumer reporting agency they may have reported you to; such as, Early Warning Systems (EWS) or any of the three major credit bureaus.
Any negotiations should be done in writing; therefore, you will have proof. If you conduct negotiations over the telephone and make payment there is no guarantee the bank will remove the listing.
Get everything in writing
A representative of the bank may agree to remove you from Chexsystems in exchange for payment only to have the bank’s loss prevention department make a decision to update the Chexsystems listing as “paid” and continue to report you to Chexsystems.
Another reason to get everything in writing is that once an item is paid in Chexsystems, the bank can report the account as paid for another 5 years in Chexsystems from the date you paid the account. For instance, you were reported to Chexsystems in 2009. This means your record will remain for 5 years and in 2014 the record will be removed.
However, if you do not get the pay for delete in writing, the bank can report you paid the account in 2012 and now the listing can remain for 5 years from the date you paid in 2012. In some instances it is best to let sleeping dogs lie if you are close to the date the item will be removed.
Here is a sample pay for delete letter to the bank
Name of Bank
Address of Bank
Re: Bank Account Number and amount owed $130
According to my recent Chexsystems report an amount of $130 is owed on a closed account. This amount was apparently reported to Chexsystems in 2009 but was unknown to me until I received a copy of my Chexsystems report.
Although I never received notice of an outstanding amount owed to the bank I am willing to pay this account in full in exchange for a deletion from my Chexsystems and any other consumer reporting agency this may have been reported to, including but not limited to Early Warning Services, Telecheck, Transunion, Experian or Equifax.
The reason I am offering a payment in exchange for a full deletion is to get the item removed from my Chexsystems file. This offer should not be interpreted as recognition of the debt as valid or acknowledgment of liability for the debt.
If you accept the terms of the agreement, a cashier’s check in the amount of $130 will be sent to you provided there is complete deletion of any reference to the debt from my Chexsystems file and any other consumer reporting agency mentioned above. The deletion should take place within 10 days from the receipt of payment.
Upon your acceptance of this agreement please prepare a letter on your company letterhead and signed by an authorized signatory as to the terms of the payment for deletion and forward it to me at the address mentioned in this matter.
If I do not hear from you within 30 days of your receipt of this letter, be advised that this offer will be withdrawn.
Thank you for your time and consideration in resolving this matter.
(This is just a sample letter, please revise as needed)