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Question By
winnefred

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We are looking to get pre-approval for a home by Fall.
My husband has just over 1k in collection debt with 5 different sources on his credit report. We planned on paying them in full today & clearing his name. Would that help his score raise & is that a recommended step? Thanks in advance.

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Negotiate!

Helpful to 2 out of 2 people

Just paying off the collections will not clean up your credit report!

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When working with the collection agencies, negotiate a deal to have the collection activity and lates completely removed from your credit in exchange for your payment.  If they agree, then the collections will come off of your report in a couple of months.  If not, then they will show paid, but remain on the report, damaging your credit for 7 1/2 years. 

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A strategy that can help is starting the conversation by asking what it would take to settle the debt.  They'll likely start by saying that you have to pay all of it and tell them that you can't afford it right now as you have other bills to pay.  Then offer a deal where you could pay them in full, but only if they can remove the collections from your credit report.  Be firm, but polite that you are willing to fully pay off the debt, but only if they will agree in writing to remove the bad information from your credit report.  If they won't, then tell them that you'll have to think about it and get back to them.  Call back later and get a different agent to talk to and try again. 

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If all else fails, pay up and deal with the 7 1/2 years, but dont' give up without first trying to negotiate the removal.

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Good luck and let us know how it goes!

Reply by
winnefred

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Enter Your ReplyTy so much I'll start making phone calls tomorrow! Praying they work with us, we have every penny to pay them off today we just NEED that score up a little more!

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