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Question By
patrickjune

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Curious about my credit score? Will it go back up if I pay off my collections?
I've got like 5 accounts in collections and I've payed 3 of them off. When will it take effect and will it bring of my credit score?

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Letter of Deletion

Helpful to 11 out of 11 people

If you have accounts in collection and they aren't already close to the 7 year period what you want to do is before paying anything have them come up with a pay off quote and agreement and get it in writing with them also agreeing to write a letter of deletion. Then you are safe to pay so that they will be removed. 

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Worked for us

Helpful to 12 out of 13 people

I paid of my wife's medical collections and she went from 4 derogatory remarks to 0 the follwing month. Her score went up 60 points over 4 months.

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Reply by
zevus

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Helpful to 9 out of 12 people

I guarantee a credit issuer wouldn't remove previous derogatory information, if you paid off a collection agency (they don't see any of that money).

You'd need to negotiate a pay & delete and get something in writing.  

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Reply by
zevus

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Helpful to 6 out of 8 people

Well, I should correct myself....  Sometimes debt is sold to a collection agency, other times a collection agency is hired and gets a certain %.  So, yeah, they will see some of that money... sometimes.

Which is why you need to talk to the collection agency before paying anything off, to make sure this derogatory info is deleted also.

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Reply by
Jamz58

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Helpful to 3 out of 5 people

That's why I said medical.

I talked to them and they would not promise anything other than showing it paid in full.

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Helpful to 8 out of 8 people

Laws vary by state, so it's hard to say.  

If something is in collections, it has most likely been deliquent for something like 6-9 months or longer. In most cases, it's better to not pay it at all, rather than reset the 7-year dropoff period by making a payment (or paying it off).  Both will extend how long this derogatory information appears on your credit report.  

As to your question:  it may raise your score some minimal amount, but it will never be very good as long as the derogatory marks stay on your credit report.  If these accounts have been in collections for over 2-3 years, then you'd be making a serious mistake in paying them at all.  The only exception to this would be if a lawsuit is pending or you feel that you may be sued for the outstanding debt.  Check the statute of limitations in your state.

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Old vrs new collections

Helpful to 1 out of 1 people

I am trying to clean up my credit.  Found through Credit Karma that I had accounts that weren't mine, so have filed disputes.  THANKS CREDIT KARMA!!!!!

my question is that I will be recieving a gift of money to help me with my credit score.  I owe far more than I can pay off.  

First:  I plan on getting a secured credit card to start rebuilding.

With the remainder of the money, should i pay newer collection accounts first?  I have only had a couple in the last 2 years but because of poor health 4-7 years ago I got some pretty substantial debt.  I have 5 or 6 dropping off in the next 9 months so I will leave those alone.

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Reply by
pennstate04

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that's a decent plan. let the old ones fall off, paying them off will only reset their date and make them stay on longer. the most recent ones are hurting your credit the most, i'd pay those first. also, keep in mind collections under 100$ are ignored by the new FICO 8 scores, and under 250 are ignored by vantage 3.0 scores, so if you have some small ones they might not be hurting you if a company is using these models...

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should I pay off my collections

Helpful to 1 out of 2 people

I have 9 items in collection. 6 of those items are hospital related. Most of them are dated 2012-2013 but some as old as 2010 and a few in 2014. In California, I read they stay on my record for 7 years + 180 days for delinquent and up to 10 years for positive reports. I just paid off my car and my credit score when down 30 points. I have $500 in creditcard current debt.

Should I start making payments or pay off my collections accounts (starting with the newest accounts) or would this be more harm to my credit than good? I know if I make any payment to them, it starts the whole 7yr+180d all over again. And would a credit repair company be beneficial in my case?

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This is what i'm seeing on my account when i have paid off my collection "These are the collections accounts that are reported as closed on your credit report."

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Apartment hunting

My credit is nowhere near perfect but I would like to apply for an apartment, about a yeanr and a half ago I had to move in with my grandparents to help take care of my grandfather who passed away a year ago. I am now lookign to get my own place again. I did leave my apartment before my lease was up and now I owe them. Would it be wise to pay them what I owe so that it will not look bad on me when I go to apply for an apartment now?

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Reply by
pennstate04

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yes, that would be wise. an apartment complex surely isn't going to like to see that you owe money to other apartment complex's due to lease default. be sure to get a paid in full letter just in case your report isn't updated, so that you can show the new company the debt is settled. it wouldn't hurt to explain your reasoning behind it either...

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Collection debt cleared

Helpful to 1 out of 5 people

Last year, I paid off a bill that was in collection. However, I can still see it on my credit report with a $0 (zero) balance. Why haven't this been removed from my credit report? Does it still affect my credit score even though it has a zero balance?

Or should I contact the collection company, for a letter showing the debt is now cleared. That way, I could forward to Credit Karma to have it removed. I do not know how all this works, but I thought I would ask for your advice.

Thanks,

Sandra

Reply by
tsadam7013

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Helpful to 4 out of 5 people

Unfortunately, since you did not get a letter from the creditor stating they would remove the item if you paid it, it can stay on your credit report, the zero balance does nothing to negate the item.  I learned this lesson the hard way as well.  :(

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