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atchattack

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Is it a good idea to start paying off a loan again that has been in default status for 3 years?
It was originally an 11,000. I paid it down regularly to about 2,400 and then could not pay anymore due to loss of job. Three years later, I am in a much better position and the lender says by starting to pay on the loan again, I will vastly improve my credit score. Is this true or are they just trying to get their money? My credit score is much better than it was a couple years ago and I am trying to fix all of my credit. Would it be better to count this as lost? Or is it not too late to pay the loan off and fix my credit further? Would it be better for me to negotiate a pay off amount? Or would that not be as good for my credit?

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It is, in any way, your responsibility to pay for your debt. I think your loan has not gone into a collection yet when you lost your job, so you have to pay it off to avoid having a collection in case difficult situation arises again. If you did get a collection of this loan, ask your lender for a removal in WRITING before you pay if off. You can negotiate a pay off amount if you believe you can do so. It doesn't hurt to try.

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