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 Credit Scores
Profile Image

Question By
blackadonis1914

0 Contributions
0 People Helped
Will paying off items in open collection raise your credit score?

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

View your scores and reports anytime.

SIGN UP NOW
All Responses

Results 1-2 of 2Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
269 Contributions
115 People Helped

Probably not, unless it's a very large collection. Open collections are factored into your total debt, so that would be reduced and that's where the improvement to your score would likely come from. 
Keep in mind that score is not everything. Anyone pulling your credit will not only look at the score but the contents of the report. In that case, open collections look terrible compared to paid collections. It's much harder to obtain any kind of new credit with an open collection, and if you anticipate a change in housing in the next seven years you should know that mortgage lenders will expect it to be paid, and property managers usually won't work with anyone who has an open collection. 

The latest FICO model (FICO 9) gives no weight to paid collections. This model is new and not widely used yet, but sometime before the seven years is up it could be, so there's yet another reason to pay it. If you don't want to pay the full amount, you could see if they will negotiate a settlement. There will be a comment on the account like "Paid--settled for less than full balance." The important word here is PAID.

Top Contributor
5038 Contributions
1136 People Helped

Do some reading on "pay for delete agreements" "statute of limitations" "settling collections for less"

Top Contributor
5038 Contributions
1136 People Helped

and "seven year credit reporting time period" is the debt close to falling off your reports

Results 1-2 of 2Results 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.