Credit Help...?

Question

I have been going back and forth with this and have recieved a lot of great help, but at the same time it is confuseing. I have account that are old..3-4 years and not really a lot of money. I'm in a position where i can pay these account off, however i'm not sure that is a good thing. If I do it in writing and pay it in full with part of the deal being that they delete it from my credit, does that improve my credit score? Also, what if they decide against it, does that restart the clock on thr 7 years? I want to improve my credit score fast, as apposed to waiting 3-4 years for things to clear. But I heard that paying or settleing may negatively reflect your score..what can I do?

Answer 1

Well Eric, if you're able to pay them off, and if you really want to, then by all means do it. What you need to understand that even though you pay them off, the only thing it will report is "paid", or something to that effect. The collection account will still remain on your report for the 7 year duration anyway. The only way to get it off your report is to negotiate a deletion payment. And that in itself isn't an easy task to begin with. Collectors are trained to get the full amount. They have no problem whatsoever to play hardball. They bank on the fact that you don't know your credit rights. They also bank on that you won't be resourceful enough to arm yourself with knowledge to give yourself some much needed leverage. Having knowledge of the statute of limitations(SOL) is more important than you could ever think. The SOL varies by state, and can usually expire well before the 7½ year statute of limitations. What this means is that after a certain period of time, they can no longer take you to court over this, although it can still appear on your report for sometime afterwards. Usually by the time the SOL for collecting has expired, the item is so old that it no longer has a direct affect on your report.
Even though the intention is good to pay it, unless you can get it removed it won't really do your score that much justice. If you're fortunate to pay it and get it removed, then it could affect your score either way. When the item is removed, that's shortens the amount you owe (dead debt), which is good, but it also shortens your length of time establishing credit and payment history, which makes up ½ of your score. It's important to have trade lines established to offset the loss of payment and credit history. If you pay it and it doesn't get removed, it will reflect only as paid, but the negative payment history remains until it drops off after the FCRA(Fair Credit Reporting Act) SOL expires for reporting. If you don't pay it at all, it will simply run its course and fall off naturally. Recently delinquent debts (3 years or less) affect your score more than an older debt because the SOLs are already factored into this.

So, to sum it up, you can pay them,but to get your money's worth, have them remove it.

I've posted links to a couple of articles on how to negotiate paying off debts

I hope this helps

Answer 2

Ok. Here is the real answer.
Regardless of what you've heard, you should pay off the debts if you are in a position to do so. The collection agency or original creditor (whoever has the debt) cannot delete that from your report. All negative items will stay on your report 7.5 years from the date of delinquency.
After that, your accounts CANNOT be re-aged. Your 7.5 years will not start over. According to the Fair Credit Reporting Act, "...whether the 7.5 year period has expired or not, the running of the reporting period cannot be adjusted becuse of the following events or actions occur:....You respond to a post-charge off collection effort by making a payment or signing a payment agreement."

The long and short of it is this: go ahead and pay your bills. They cannot be re-aged. Make sure you have a receipt that shows the account (s) are paid. Follow up w/ the credit bureaus to make sure that they are being reported as paid. That's all you have to do. It will not make your score drop.
Good luck!
(email me if you need further detials!)

Answer 3

The first poster is wrong.

If you are talking about collection accounts, if you make a written agreement with the collection company stating that for whatever amount you agree to pay, they agree to remove the collection activity from your credit report, it is legal.

Just make sure to get it in writing first before you pay them a dime and then pay by check, money order or cashiers check so you will have a paper trail.

As far as starting the 7-years over again, that a myth it's not legal but a lot of collection people say that they can do this to scare people. Some actually do get it put on peoples credit, but you can have it removed simply by disputing it if they do.

Answer 4

The firms to which you owe the debt are not in any position to remove any such items from your credit report. That responsibility belongs to the credit reporting firms, and they do not make deals to 'clean up your credit report' because you pay off your debt.

If you pay these debts, they will show up on your credit report as paid but paid four years late, which is a good thing. The downside is that said information will remain there for seven years after you clear the debt.

Answer 5

see if they can agree to PAY FOR DELETE. If they agree in writing that they will delete the item from your credit reports upon payment...do it because it will definately help your score. The 7 years is usually 7yrs from DATE OF 1st MAJOR DELIQUENCY. But dont pay until they agree that they will delete it from your files. Give it a try, doesnt hurt to try. Also, im assuming that this account in question is past due..if its not past due at all, no need to get it deleted.

Answer 6

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Answer 7

1st of all, it isn't deleted from your credit report, it is showed as paid off...usually it is showed as paid as part of a settlement (indicating you didn't pay the full amount that you paid a settlement amount). If they are telling you they will delete it from your credit report they are doing something illegal. It does improve your credit score by paying it regardless of whether it is a settlement or not.

Answer 8

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