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Paying off a collection to the Vendor vs Debt collector. What are the pros and cons for my credit?
Vendor being the company the account was first with before being sent off to collection.

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If it already in collection, then you need to determine who actually owns and have authority on that debt. Its fair rare now days it's only send to and not been sold to collection. If it's sold? Then original Creditor no longer has authority on that debt, meaning if you paid original creditor, it won't release your liability to the collection or change the status of collection, collection agencies still can come after you or take further action against you. Before you decide to paid original Creditor (if they willing to take your payment) ask if they willing to recall the collection, tho again, it's rare but worth asking.

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More options with original creditor

I was in a situation about six years ago where my accounts were going into default due to a job loss and medical problems soon after.  I really didn't have any guidance about what to do, other than the boiler-plate advice that "eventually you can settle them for less."  This is true, in a sense.  But, had I known better, even though I had no way of paying some of these debts at the time, I would have at least attempted to work some sort of arrangement out with the original creditors, before they were charged-off and/or sold to collection outfits.

It took me a few years to get back some financial stability, but the debts were still overhanging, and thus my credit was in the toilet.  Had I reached out and explained my situation, there was at least a chance something could have been worked out and my credit would have benefited greatly.  Avoiding charge-offs not only helps your credit at the time, but you are then able to maintain an account in good standing and increase your average-age-of-account and payment history; two things that take many years to recover from if they're in bad shape.  Unpaid collections are a major derogatory item for credit, often prohibiting even 700-level credit-seekers from obtaining new lines of credit (I know first-hand, even though I've paid all my past collections, the status of some is still not correct on my report six years later!).

If I were in your shoes, I would do everything in my power to prevent an account from being charged-off.  Many creditors are surprisingly accomodating.  After all, it's in their best interest to retain you (and your money) versus selling off your account for pennies on the dollar.  Both sides win when proactively working with original creditors.  In my case, I wish I had a credit-coach at the time; I would have recovered much quicker from my setback and most likely have never reached the depths of low-credit scores that I reached.

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