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I have four collections on my credit report. They are for medical bills, a gym mumbership and unpaid cable bills. The last activity ranges from 5 to 1 year ago.
If I pay the debt does the 7 year clock start over from the date they first reported? How much does it improve my score to have the dept show a Paid in Full if it is not removed? If I dispute and it gets taken off, I will still owe. If I pay later after it is removed due to dispute will they reappear on my report? I am looking to buy a home in 6 months..,….. what is my best course of action


4 Thoughts on Paying collections to improve credit score?
  1. Reply
    July 26, 2011 at 1:57 am

    Certain companies pay for just the score from one of the 3 credit reporting agencies. Ex: when you buy furniture.

    But, when you go to buy a house, or a car they get your reports, not your score. They make their own judgements based on every line of those reports. A paid debt is going to look a lot better than an unpaid debt.

    Credit scores are a bit of a scam, because when you make a “big” loan, that fico number will never be used by anyone. They look at your report – so keep it clean expecially if you need to buy a home.
    When I bought my home, they actually made their own score, and they even asked me questions about my report. Like why I didn’t have a loan for a car.

  2. Reply
    Jay S
    July 26, 2011 at 2:04 am

    Yes if you pay they update the date of last activity which will restart the 7 year clock and will actually lower your scores because you are updating a negative account. The best thing you can do to improve your scores in the shortest amount of time is to negotiate with the collection companies to delete the accounts for payment. Prepare a from letter with the agreement that the account be permanently deleted from your credit. Call the company and say you are willing to pay off the collection with certified funds in 24 hours if they will sign the agreement to delete. Do not send any money without having the agreement signed buy the collection company.

  3. Reply
    July 26, 2011 at 2:53 am

    Derogatory items age off your credit report 7-1/2 years from date of first deficiency. This is per the FCRA and nothing restarts the clock.

    The Statute of Limitations (SOL), the timeframe to bring lawsuit, varies from state to state. Typically it starts from the date of last activity or last payment. People often merge and confuse the reporting period and the SOL.

    Paying off derogatory items will not improve your score unless you get the items removed. The damage is already done. However, creditors look at your whole credit report, not just the score. Paid old debt always looks better.

    Since these are single entry items, you should be able to negotiate a delete for pay — you pay $ x and they remove the item. You should be able to settle for less than the balance. If the debt is over 3 years old, offer 25%; 2 or 3 years old, offer 50%; less than 2, offer 75%. Lump sum gets the best deals. Payment plans have to be short term. Get any settlement agreement in writing and keep it, along with your payment proof, forever. Do not give the collector direct access to your bank account.

    Now is the time to settle all derogatory items on your credit file, even if you can’t get the collector to agree to a pay for delete. Mortgage companies will require settlement before approving you.

  4. Reply
    July 26, 2011 at 3:23 am

    I’ve ever met the similar thing — still a little bit annoy,here is the resource tha help me out.

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