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How do my scores drop 60 points after paying off an account in collections?
I'm at a loss and very frustrated. Both my scores were at 685 (give or take a couple points). I had a $148 account in collections and I paid that off a couple months ago. TransUnion took longer to clear it than Equifax (actually had to dispute it with TransUnion to get them to drop it).

Inexplicably, my scores plummeted 60-65 points AFTER clearing the account in collections. How does this happen? I figured my score would bump up, hopefully over 700, since I no longer have accounts in collections.

I was looking forward to applying for a debt consolidation loan, but that's going to be a lot more difficult now that my score have nosedived to 620. And the interest rates will be terrible.

tl;dr: My scores were ~685. Paid off the one account I had in collections. Both scores immediately dropped to 620 after doing so.

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Time and time again...

This is the same old question that so many "Newbies" to understanding their credit have.  

ANY Change you make in your credit report will have a negitive effect for a short term, Usually 60 days or less.  Why, Because when the system was set up by the Credit lenders, systems were put in place to protect themselves from making big financial mistakes.  So ANY major change to your credit report will lower your score until enough time has passed to be sure that the change is correct and not a mistake. It used to be that changes were reviewed by humans actually looking at paperwork, now days not so much, but the systems are still there.  

The reality on Credit scores: Credit scoring is a slow moving behemouth that often takes 30 to 60 days to reflect your actions.  The scores you see here and on other sites are "Estimates". You can have as many as 300 different scores on any given day.  Your actual score is a mystery until the moment a lender pulls your credit report.  The same lender can pull your report on the same day and get a differect score for you, depending on the type of loan or credit being extended.  Its better to understand what range your score is in rather than the exact number, Since that is the deciding factor as to what rates and terms you will get.  

Hope that helps 

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