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Posted in Student Loans
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Question By
LauRock80

4 Contributions
0 People Helped
Which loan to pay off?
Loan 1 (12 years old)- $4800 - defaulted
Loan 2 (11 years old) - $8800 - defaulted / charged off - Can settle for $5000

I have the $5000, and trying to figure out which loan I should pay off to improve my score now. How much should my credit score improve when a charge off is removed?? I can settle, but I am worried that they won't delete the charge off and will instead say 'settled for less' or worse stay on there for another 7 years. Tempted to pay off the one that is just defaulted since I know it will come off and reduce my overall debt ratio. Trying to determine, which one is best to pay to improve my score now.

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Top Contributor
7370 Contributions
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Student loans don't leave.

Been there!!

Student loans have NO statute of limitations and do NOT fall off the credit report.  If you can settle loan #2 for %5000, go for it!!!  Then get busy paying off loan #1.  Only after these loans are cleared out will you have a chance for an improved credit score.

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