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should i pay off closed accounts?
I have balances on my credit report that have been closed or written off by the creditor. Should I pay start paying these off to raise my credit score? Do they still affect my credit if I don't?

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Be VERY careful in paying collections

Helpful to 92 out of 111 people

Here's a story...Just food for thought.

My very first major credit card was a co-branded Bank of America Visa with a credit line of $3500.  I took very good care of it, in the sense that I never had a late payment, for six years. Because I did not have the first clue about utilization rates or the notion of paying it off each month, I did, however, always have a large balance on it. 

At one point, Chase acquired, from Bank of America, the portfolio of accounts that included my card.  I continued making on time payments for another couple of years, though some particulars about my card changed--everything from interest rates to customer service.  

A couple of years into the new credit relationship with Chase, with a balance that was now bumping the top of my credit limit, I found myself struggling to make ends meet.  I was transitioning between school and work, and I got behind on payments for the first time. 

 At sixty days late, I called customer service. I spoke to a CSR who was very kind and told me that as long as I got a payment in by a particular date--just before the 90 day mark, my account would not go into collections, and I would be able to get back on track. 

I scrambled to pull the money together and, when I called to make a payment by phone, a couple of days ahead of the deadline, I spoke to another CSR who told me I was too late. My account had already been sent to collections.  I told her that the previous CSR had told me that, so long as I got my payment in by that particular date, I would be ok.  She said that they could alter that at their discretion since I was already significantly behind. And now, I was responsible for making the balance payment in full.  I was told that I had already been given the option to make payments and had failed. GREAT!

My delinquency began as of November 2005.  Because of my own ignorance of the games that Collection Agencies play, this account continues to wreak havoc on my credit and my life.  

The account went into collections.  It ended up in the hands of a large, aggressive and unsavory debt collection company.  They contacted me in 2008 and told me that if I didn't pay the balance, plus interest, I would be sued. They also told me they were collecting on behalf of Chase.  

That was a lie.  

I didn't know it at the time, but this group, like other junk debt buyers, purchased my Chase debt at pennies on the dollar. Chase had long since written off my debt.  I was in VERY bad financial straits at the time, but I thought I would try to pull something together because they were offering for me to make payments--something I had not been able to negotiate with Chase.  

The collection agency insisted I make payments through Western Union (meaning no record of transactions would be connected to my bank account). I began making payments--which immediately reset the clock on my debt.  It also meant that I was double dinged on my credit report because the Chase delinquency continued to appear, as well as this new collection account--as if it were a new one.  I paid about $1200 on the debt and then was unable to continue, which brought the collection agency's pursuit of me to a whole new level.

The collection agency handed my account over to their partners in crime--and I say that with the full measure of its perceived meaning--a large legal firm who focuses on collections.  That group filed a lawsuit against me--unbeknownst to me, because they NEVER served me.  

In my absence, they won a judgment against me for an amount far greater than my initial debt to Chase, all without my knowledge. There was no record of or indication that I had paid anything of that $1200 to the collection company (an amount, I might add, that was likely MUCH more than they had paid out to Chase to acquire my debt). 

Now, the debt clock was ticking away on an amount far greater than anything I had ever charged, with interest accruing at a legally sanctioned 10%.

I only learned about the judgment after my part-time wages began being garnished--deducting from what was already a meagre amount.  Further, each time they took from my paycheck, a fee for payment processing was also deducted from my paycheck for the sheriff (or marshall)...I got paid twice a month, so I had to pay that processing fee twice a month.

My employment status during this period was thus--I was a single parent trying to go to school to earn a teaching credential.  I had finally earned that credential at the end of 2008 and began looking for full time teaching positions. I landed a temporary contract and had my first salaried position. Unfortunately, because it was only for one school year, it didn't continue. I took a part-time, non-teaching job in the school district for the next school year, hoping that another teaching position would open up. 

Instead, what greeted me that fall, was a judgment against me--a garnishment of wages through the district.  Essentially, I was blacklisted from higher levels of employment. I was never considered for another teaching position. I was laid off at the holidays that year, and have never returned to work for the district again. In the time since, this has made it difficult to pay anything, let alone that judgment, and I have struggled with employment, in general, ever since.  

So,  in review:

By paying the collection company, none of the money was going to my original creditor, so I wasn't making good on the original debt anyway.

The collection company paid Chase pennies on the dollar, in exchange for the right to pursue me for the debt at the full amount, plus interest. Though I did pay them  a substantial portion of my debt, there is no record of those payments, as they were not processed through my bank account.

By resetting the date of my delinquency--by paying the collection agency--I opened myself up to a lawsuit. And I now have a judgment  against me, keeping me from good employment opportunities, home and car purchase options, etc. The amount is at about $7000 and growing. 

Further, the lawfirm who has the judgment against me is entitled to renew the judgment, when it expires, for another ten years--and then another ten years after that. Unless I figure out some way to pay them, my entire financial future is in jeopardy, and I am not getting any younger.  

Had I NOT paid that collection agency, I would not have reset the date of the debt.  Had I NOT paid that collection agency, they likely would not have forwarded the account to their attorneys--but even if they did, the debt would not be appearing on my credit report, as it does now, long past the seven year mark. Had I NOT paid that collection agency, I would likely be several years into a teaching career that I fought hard to have.

That's what I got out of trying to make good on a debt to a collection agency.  

My advice...Be careful. Get everything in writing. And know that, even then, you could be opening yourself up to a whole lot more trouble than you might imagine. I am all for doing what is right.  Just be in charge of what happens to you. Know the rules and hold collection agencies accountable.  Proceed on your terms and protect yourself.

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Helpful to 16 out of 29 people


I'm 100% serious.  Just declare bankruptcy.  It'll cost you about $1000.  But it'll be the best $1000 you ever spent.  7-10 years later everything will be cleared up.  I hated doing it, but it was the best/worst desicisions of my life. It got everything back on track.

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Helpful to 6 out of 14 people

I don't think you can claim bankruptcy on judgements, can you? I always thought that was not possible.

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Helpful to 6 out of 8 people

Enter Your Reply

Did you ever contact Consumer protection, regarding Fair Credit practices? This all sounds very unethical, even criminal 

look into Fair Credit reporting laws. I would sue that *******s that caused all this hardship on you.

Sorry for your troubles.


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You're seriously uneducated about credit and how it works and you're trying to teach kids? Thank God the district pulled your *** outta there. For all we know you probably Western unioned the money to some scammer in india. Who in their right mind Western unions a debt payment!

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15 People Helped

Closed accounts

Helpful to 15 out of 19 people

No one really answered, the questioned. Question being once a closed account is paid off, will the credit score go up? 

I have a closed account on my report, it is still with the orignial creditor, and I am paying down the balance. Once the balanced is paid in full will my credit score go up? 

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24 People Helped
Helpful to 18 out of 21 people

Yes.  And if you have a secured credit card, it'll bump it even quicker than that...but do both.  And get a good secured credit card; one without annual fees.  They're out there.  Just research.  Also, don't pay balance in FULL every month; always keep about a $10 to $15 balance as it shows activity.  However, still don't be late, and still don't use more than 25% to 30% of your credit available each month.  Also, find out when your credit company reports so you don't use your's down to $15...when they report.

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4 People Helped
Helpful to 4 out of 6 people

I have the same scenario as you and the same question as you.

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37 People Helped

Helpful to 37 out of 49 people

there is also the option of credit repair! for $99 a month at lexington law you can get a lot of derogatory items off all three reports. by law once

they are removed they cant be put back on.  they will challenge late payments chargeoffs judgments anything negative. when it comes to dealing

with creditors they have to be able to prove you agreeed to the debt. but when the debt is sold to the creditor there is no paperwork involved.

the creditor cant prove its a valid debt. so when its challenged and either they cant prove it or dont eespond within 30 days it is going to be removed.

this option may be a lot cheaper than bankruptcy.

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Helpful to 20 out of 24 people

In 2012, I began a credit repair relationship with Lexington Law. I have nothing negative whatsoever about them. In fact, after about 6 months I decided to end the relationship. Why? Because I became well informed and educated on the steps a consumer needs to take to begin DIY credit repair. 

They were very helpful in answering any and all questions that I had(I was like the little 4 year old that says, "how come", "why", "how do you do that", "what's that", etc. etc. etc.) lol LL also had a variety of tools, workshops and other resources for s consumer to intake all the knowledge they need to understand why those blemishes appear, how each credit bureau operates, which blemishes to focus on first and why, communication options between you and the bureaus an which one to use and why. 

I can go on and on but to shortcut my 'journey', I will conclude with this... money was funny hence the reason I sought out help. However, since I had all this extra time on my hands(I was injured at work back in 2010), I would keep my pennies in my coin purse and make a go of it myself. 

When I began with LL my score was in the low 300s(my reports were a hot mess and I'm even sure how they got that way when I had filed BK in 2004). Anyway, when I left my score was 397 and I was thrilled. Some were removed, status updates on others. My score was moving on up with all 3 bureaus. The scores werent the same on them but they were climbing... 397, 402, 412, 425... I was able to get an Unsecured CC with a CL of $300. APR was 19.97% which is high, true but my score went from 425 - 562 in four months.

Printing out my reports was using less and less ink and paper. I had to remind myself that between 'Live, Love and Laugh' you need to be able to withstand the rain, snow and the perfect storm. My score has dropped significantly. It was a sad moment seeing the 612 disappear. The one thing I wasnt aware of was the stalking of old debt(statues of limitation on a debt can start over)

If you decide to go with LL or any other company that helps repair a consumers debt, my advice to anyone would be... do your homework and utilize all the 'free' resources for consumers (i.e., Credit Karma, CFPB, FTC, BING, GOOGLE, etc.) or ask your co-worker, neighbor, family, friends, barber, beautician, yogo instructor, baby sister, etc. Just remember a closed mouth doesn't get fed and we live in the age of technology and everything in the world is trending.

You'll be proud that you challenged yourself and was able to successfully tackle this project head on. Not only that you wont have to wonder if those companies employ trustworthy and honest individuals or has someone copied and pasted your life's 'code' to use once they've reset your ROM. lol

I'm currently working on mine as I type. I have finally been able to make those awful sticky, annnoying web of student loans to disappear. Sallie, Fed and USeD(U.S. Dept of Ed thats my nickname for them) are like the spider web that you saw and made sure you avoid it then out of no where you feel it on your eyelash, ear, mouth, cheek and no matter how hard you try and think you've swished or wiped it away.......... there it is floating all over you.

I have my letter templates, envelopes, supporting documents, and printer ready to scan my copies into the clouds before my road trip to the U.S. Post Office for certified mailing.

I rarely comment on these blogs but tonight I felt it was turn to contribute and give back to the online community that has answered my questions or provided feedback on a product I was interested in.

So my fellow CK Community Members, enjoy your weekend, keep your head up, be patient because there are great rewards awaiting at the end tumultuous chapter of credit repair

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3 People Helped

Help charged off

Helpful to 3 out of 3 people

I purchase a car in 2011, havnt paid it for about 6 to 7 years. I been trying to work on my cresit as it is charged off on my credit. I called the auto loan and they try doing a settlement but asking to pay around 400 hundred a month. But it already went to collection stating its a total lost and charged off and closed.. but the bank i called is trying to get payments. Someone please help me with anything. Thank you

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5 People Helped

No it wont

Helpful to 5 out of 6 people

Do not listen to the people saying it will help i had a low score due to collections. I got so tired of being denied for everything so one day i took a lumpsum of money and paid every small collection i had off. Leaving only one thing left to be paid 3 months later no changed in score still being denied. I recently signed up with credit repair hoping this will help.

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7 People Helped

Charge off

Helpful to 7 out of 7 people

I am currently fixing my credit and I have an item that is showing as charged off.  Under the account details to the right of the section there shows a balance and what the monthly payment is, and then to the left in green and bigger numbers to the left hand side it shows a different balance amount that is due. How do I know what I acutally owe on the account?

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Helpful to 8 out of 10 people

OKay. So I am basically an idiot.

I don't really have any family I can talk to these things about or learn from and I think I really screwed myself.  I had gotten a couple credit cards. I had NO credit and I really  needed to raise it.  I was using them and payinghtem and my credit was raising pretty fast I was stoked! But, I fell on the HARDEST of times and i used up my credit line and was unable to pay it off.  One went to a debt collector.  theothers (with capitol one) are closed out and I don't believe have gone to s collector yet, but... i could be wrong. 

WHAT DO I DO?!?!?! 

I thought maybe my best option would be to call them all see how much it would be if I paid it all off at once and try and get a loan to pay off the debt and have one payment but... will that even take it off of my record?  what can I do to help my now comepletely ruined credit. 

I am 27 years old and totally clueless...

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1 Person Helped

closed account / collections

Helpful to 1 out of 1 people

Based on my Experience you can use a credit  repair service or you can do it on your own. I recommend going through the credit reports and dispute first because if the junk buyer or collection company cannot validate the debt within 30 days in most circumstances that it has to come off the report. Now  you can go to FCRA and look at other things to dispute which some credit repairs will do as well. The next thing is if you had a hardship  on why you could nt make the payment and is still with an original creditor as it has better results is a Goodwill letter and explain the situation to the creditor and this works well for late payment statuses on your account as well. The original creditor if they are the one still dealing with your account may send you a settlement offer and will take the negative off your account and update it to a good status or remove from you. Pay for deletion is another tactic to use. Junk buyers and collection agencies buy your stuff usually from .04 on the dollar to .07 on the dollar I have found out had friends in collections. Now if you offer .20 of the dollar in a pay for deletion letter where they send you a letter back with the company letterhead saying they will delete the account if you pay this settlement within 5 days or 10 days. do a certified check to pay them. ok now if you do not see that it came off your report in 30-60days as some will try to mark it paid you have the letter from them you can turn into the bureau  and to dispute it at that time. the credit repair company can do this as well if you send them the letter. The thing is junk buyers and collection agencies want profit the original creditors right it off and want it off their taxes so this where the 2 come in. now the older the debt so say 3-5 years the debt may have went through 3 companies so they may have paid .02  on the dollar  for your debt so lets say a 5,000 dollar debt and they paid .02 cents per dollar they got it for 100.00 now if they could make the 5000 they be estatic but if you offer .15  for the deletion yes you pay out of pocket  now but  that is $750 and they delete it from your credit report well it should increase your credit report as the derogatory is gone but if you are buying a house the DTI ratio is better with that collection gone. It could be a win win for you in that case. now if you are at 6.5 years and you buying a house after the 7 years will hit then I would wait and let it fall off. Collection agencies want the bonus and your money so 750 dollars for a 100 investment is great to them and they delete. DO not talk to them on the phone  send a letter to them. If you call you can get screwed into resetting the statute if you are not paying attention. if you get a settlement without a deletion piece you can call then if you like and say this is what I got in the mail and do not acknowledge the debt and say I want to settle this debt but need a deletion letter on the company letter head. do not i repeat do not acknowledge the debt as yours or say it is yours they will record calls and use it against you. this is what I have done for me and family over the years to help clean up the reports. FHA loans for mortgages will allow letters to the underwriters explaining collections unpaid and they could still give you a loan. it could be figured as 5% of your monthly debt so that $5000 debt could look as a $250 payment monthly which could significanly increase that DTI. I hope this helps some one

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7 People Helped

Closed accts

Helpful to 7 out of 11 people

Hello I see a few ACCTS on my credit report with closed on them. Should pay them if the collection agency call me for them. On the flip side I havee a collection agency is telling me that once I pay the balance owed it will go back to the original owner I do not see that account on the credit report. I don't know what to believe or do please help me!!!!

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Helpful to 8 out of 10 people

Enter Your Reply it's not true I remember not being able to pay my credit cards off because I lost my job, after 7 years everything went back to normal and I started over. Once they go to collections leave it alone. record  the date of each one that is in collections , and keep track of each one so when 7years are up you can get them removed from your credit report. by calling the colection agency and having it removed.

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24 People Helped
Helpful to 5 out of 5 people

Depends.  Are they medical?  IMO, medical shouldn't even be on someone's credit report.  What the heck.  It's not like you bought a car or clothese or jewelry, or went on a vacation and decided not to pay your bills.   You go to the hospital because you're sick, or it's an emergency, etc.  Not to mention these hospitals and medical centers and doctors GET REIMBURSED FORM THE STATE ALL OF THE TIME...sshhhh, that's the dirty secret no one is supposed to know.

As for something that's not medical, are you trying to buy a home?  Seek employement?  Get a car?  If so, find out what you would need to do to acquire the credit BEFORE you pay collections off.  In other words, if you're buying a home, FHA, medical doesn't count, and your debt can be up to $2000 unpaid non-medical.  But you would need a FICO of high 500, minimal, with a good show of income.  So in that case, I'd hesitate on the collection accounts if they're not significant and they're old.  If you're trying to buy a car, get a super cheap one because you'll get raked with a high interest rate.

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6 People Helped

Closed Accounts

Helpful to 6 out of 9 people

Hello I bought a car coming up on two years , and  my loan was bought out by someone else because they said I've been good at paying my notes. But my question is? Why does it show up on my report as a closed account if I'm paying it?

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