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Cjohns1

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Paying a collections account with original creditor or collection company
I have a phone bill that was given to an collections company but the company still owns the debt the collection company is just working for them. Would it be better to pay it thru the collections company or the original creditor? Would the collections still stay on my creditor report what would the best course of action be to keep it off my credit report and have it removed.

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Validate, negotiate, pay, and/or remove

Helpful to 17 out of 18 people

Outstanding debt is always a negative on your credit reports.  And since your credit scores are made of positive factors versus negative factors, paying this debt should improve your score overall.  So if you are ready to negotiate on a debt, you will probably be better off talking to the creditor directly instead of a collection agency. This is because the creditor has more discretion and flexibility in negotiating with you, and may see you as a former and possibly future customer; thus more willing to assist in repairing your credit.

However, finding who OWNS the debt and if it’s current owner has all the required proof that the debt is truly yours will be your first priority. 

If a collection agency bought the debt from the original creditor, rather than the original creditor just assigning the debt to the agency for collection, the collection company owns the debt. And if you negotiate with and make payments to the original creditor after they already SOLD the debt to a collection company, the collector/owner of the debt may refuse to credit you for those payments and continue to pursue the debt through its own collection practices because they actually own the debt.

If the debt was sold to the collection company. You can still call the original creditor and ask if you can negotiate on the debt directly with them or if you must continue to discuss it with the collection company.  Just understand that original creditors that sell a debt to a collection company, might not be able to purchase the debt from the collection company, and you may be forced to work directly with the collection company anyways.

Ideally, the original creditor will immediately negotiate with you, and you’ll be able to work something out. Unfortunately, that’s rare. It’s more likely that the creditor will only take the debt back if you negotiate with the collection agency, establish a repayment plan, and make two or three payments under the plan. If this happens, the creditor may eventually give you a new line of credit, helping you rebuild your credit.

You can negotiate payoff of the debt in one lump sum, or perhaps you can negotiate a better payment plan. These are the same options available if you negotiated directly with the collector, although the creditor may be more flexible and willing to compromise. Also you may want to ask to have the negative credit information on the debt removed from your credit file, or shown as payment in full, if you make the payments under the new agreement.

Most importantly, is that whatever outcome you negotiate, you need to GET IT IN WRITING!!!  Put in writing any agreement you reach with the creditor (preferably in a letter from the creditor to you, although a letter from you to the creditor confirming the agreement and asking the creditor to correct any errors is better than nothing). Part of the written agreement should be an acknowledgement by the original creditor that it owns the debt and is willing to request a deletion of the debt once the balance of the payment arrangement is paid. Send a copy of the letter to the collector.  Once the debt is paid, they original, and any subsequent collection accounts should fall off of your credit, or if they don’t, you now have a letter confirming the arrangement that you can send to the credit bureaus for deletion of all of the associated accounts listed in your credit report.

Hope this helps.  Please humbs up if it does.

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Contact the original creditor and ask them to pull the account back from collections in exchange for your payment in full. Tell them you are only willing to pay if they agree to delete the account from your reports. Do some research on "pay for delete offers".

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