Paying off old debts?

Question

Hello everyone,
I have debts from the last several years.

But my question is, is it better to settle on a debt if the collector is willing to, or pay off the entire thing?

I know either way it will hurt my credit for a period of time. I also know it will not reage them, as long as I pay it in one sum. It just turns on the current status for so long until they diminish several months later from the for-front.

Answer 1

If they will offer you a settlement, take it.

They are required BY LAW to remove the item from your credit record within 30 days of final payment of any debt, even if it's a settlement amount, instead of full amount. While the item may still show, IT MUST REFLECT the paid in full, or you are entitled to charge them with fraud.

Once you pay a debt, stay on them until that is taken care of.

Answer 2

Settle the debt for a lesser amount, if the creditor is willing. This may keep the debt from being reported to a credit bureau. Many creditors are willing to settle on a lesser amount, if paid off in one lump sum. Many will actually agree to match your payment dollar for dollar. For example you pay 500, they will match that with 500.
Try to settle if you are able to work out an agreement with your collector.
Another thing to keep in mind, there are stringent guidelines that the collector must follow. A debt collector is not allowed to contact you by phone before 8 AM or after 9 PM. They cannot threaten to send you to jail, or threaten to send anyone to collect payment in person. If they tell you that they are sending the police to your house, then you must be served papers within 5 days. They are not authorized to speak with any other member of the household that you reside. These and other rules are contained in the Fair Debt Collection Code. There may be some variations depending on your specific location.
I hope this will help your current situation. Good Luck!

Answer 3

Settling the debts gets your score higher not much but it's a start. But when you talk to them make sure you request a letter from them that the debt has been paid..in case they forget to update your credit info.
By now the debts could be paid off by almost half what you owe.

Answer 4

The collector is correct. Creditors would rather take a chance with ou if you pay back the full amount. If they see "settled for less than full amout" on your credit report they know what to expect. Besides you have 2/3 of the money already. If you were in debt $20k with $1k to put towards it I might have a different answer

Answer 5

It's a good thing to settle a debt for less than you owe. However, the difference between what you owe and what you settle for could be treated as "forgiveness of indebtednes income" and you might receive a 1099 form reporting this to the Internal Revenue Service.

Negotiate for a credit report entry stating "debts satisfied on mutually agreeable terms" or words to that effect.

Answer 6

I would suggest you to join a debt settlement company who will negotiate with your creditors as well as debt collectors too. They will bring down your principal debt by around 30% to 70% depending on your credit cards.

you can make affordable monthly payments and be debt free within 3-36 months. There are hidden costs and upfront fees associated with the monthly payment options.

Check out this debt settlement company who has helped me out with the unsecured debt situation.

http://www.debtfreeafterall.com

Good Luck

Answer 7

You should opt for debt consolidation. When you gets into a debt trap it becomes difficult to get out of it. Taking more loans to repay the debts leads to more stress and financial crisis. Finally, there is no option but to adopt debt consolidation, which leads to a new llease of life. Many people receive abusive calls from debt collectors and are stressed. Hence opting for debt consolidation is the number one solution and helps to overcome abusive calls and be free from mental stress.

Answer 8

Settle
sometimes it is THOUSANDS less!
Negotiate with them as to how they are going to update your credit and tell them that the settlement is contingent upon the update and that you want that in writing BEFORE YOU PAY (so if they dont follow thru you can send a copy of it to the credit agency).
If they dont agree, tell them no thanks on the settlement.
COngrats on moving yourself into a position where you can pay them off!
GOOD LUCK!

Answer 9

If it's in collections, you're wasting your money if you pay it off. It will be recorded as paid...but the collection status will still be on your credit report, so you're pretty much just throwing money away if you do that. If something hasn't gone to collections, that's when you pay...but if you can't prevent that, just let it go. Believe me, it won't improve your credit in any way.

Answer 10

E-mail me [e-mail] and I will email back to you a letter of agreement to pay for less than owed as well as them removing the negative inquiry from your credit. chances are they will agree just to get money.