Do collection accounts paid increase your fico?

Question

I was a victim of identity theft and found erroneous charges. They highest one is about 1000. They are all less than 2 years old. I tried to dispute them, but no removable. Should I pay them off to and the current tradelines I have or not? TO PAY OR NOT TO PAY? THAT IS THE QUESTION.

Answer 1

I agree with steven s.

After you file the police report, dispute those TL's with the credit reporting agencies.
Be sure to include a copy of the police report with your dispute to the credit bureaus.

If the accounts are held by the original creditor, send them a debt verification letter.
If they are being held by a collection agency, send them a debt validation letter.

Do not do your disputes by phone, do everything in writing. Create a paper trail. Send everything certified mail return receipt.

You will probably have a fraud alert placed on your files. That will make it difficult, but not impossible, to apply for credit.

If this is truly identity theft, I would not pay. I would be disputing them off of my reports. If the agency's refuse to delete, then speak with a lawyer. This is where your paper trail comes in to play.

Answer 2

File a police report and get a copy. Have your accounts noted at all three credit reporting agencies. You will have to do this separately for each agency. Notify the companies that are reporting the information to the credit bureaus that you have been the victim of identity theft and have filed a police report. Sign up for one of the credit monitoring services (about $10 per month) and they will notify you via email each and every time anything changes on your credit report, including scores. This way should anything else happen that is suspect, you'll know immediately. Do not pay the disputed charges without doing all these things first. They may remove the negative info voluntarily. If they do not, then hire an attorney after you can show a reasonable effort was made on your part to take corrective action.
Paying the accounts off will raise your FICO scores, but it will take 12 to 24 months after the payoffs occur.
Good luck and I am hoping this will help.

Answer 3

You tried to dispute them but they're not removable? That's erroneous - if you can prove identity theft, they must remove them. Have your signature checked against them for starters.

No, don't pay them. Take them to small claims court if you must to prove they are not your debt, but if you pay them off, you're admitting they're yours.

Answer 4

Not really. In fact, even if you pay them, it will still show on your credit report that you had something go to collections. The only way to REALLY fix your credit it to let the 7 years pass and allow it to fall off.

Answer 5

Do not Pay