WHy is my credit score so low?

Tips and Deals Forums Improving Your Credit Score WHy is my credit score so low?

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    • #223018

      Ok so I just settled an old Sprint collections account for half the cost about a month ago.I got the papers and everything saying that it was paid in full.Now on my credit there is only one credit card that I keep low balances on and an old Verizon account from last year for 900 somethin.I don’t have that kind of money to pay that last bill.And I think it’s too much for a cell phone bill.The creditors have suddenly started calling after about a year of not calling.And they call from different numbers each day.There is no way n hell paying that much for a phone bill so I’m just going to wait until it drops off since it’s the only not unpaid account left on there.However my credit score is 5 something which is really bad.Why is it that low with only one unpaid account.Is there anything I can do to improve my score without paying this?If I open more account again will that help?
      Btw my credit score recently just dropped by 100 n something points.

    • #290318

      Your credit score doesn’t go up just because you paid a bill but remains down because of your poor credit history which remains on your credit report. It takes a long time to age those bad payments off the report. Lenders base their lending on how you paid your bills in the past (were you late, etc.) and not whether you finally paid your bills.

      Paying a collection at half the cost may possibly also cause your credit score to drop since there is a new negative report indicating that you settled for less than the full amount. Even though you have a paper stating that it was paid in full, the report made to the credit bureaus states that you settled for less than the full amount which is another bad mark on your report.

      Lenders work much like any person would. Would you keep lending someone money if they constantly had excuses why they couldn’t pay it back on time? Even though he may eventually pay it back or only pay back 1/2 that was owed after many phone calls, would you continue to lend that person money? The average person would say that they have a bad history with the borrower and quit lending him money.

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