Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Paying Your Bills
Profile Image

Question By
kandyceglenn

0 Contributions
0 People Helped
Will it help my credit score if I pay collection accounts?

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
713 Contributions
2570 People Helped
Most Helpful Response

Helpful to 3 out of 3 people

That depends on a lot of factors.

First of all, once a bill becomes delinquent or goes to collections, you'll carry the record of it for at least seven years whether you pay or not. Generally, people are very disappointed when they expect a big score increase after paying an old debt.

If the debt is quite recent -- within the last year or so -- you might want to repay it or settle it for a lesser amount just to get the credit rebuilding process under way.

BUT if the debt is already a few years old, you're generally best off just to ignore it until it rolls off your record. It's a terrible flaw of the credit system that, once you agree to pay, the collection agency can legally "re-age" the debt, keeping it on your record for YEARS longer than it otherwise would have been.

There are exceptions (e.g. if you think you're about to be sued for the debt). But general rule: you benefit more by ignoring old debt than by paying it.

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.