2 Thoughts on Which is a better way to improve my credit score? I have 3 accounts closed n in collections. Is it better to ?
  1. Reply
    Bruce K
    July 4, 2011 at 8:21 pm

    Paying them all off, as it will take 7 years for that to be wiped off your cerdit score.

  2. Reply
    bdancer222
    July 4, 2011 at 8:27 pm

    Neither. Paying off derogatory items on your credit report will not improve your score. The damage is done and will remain for the balance of the 7 year reporting period, whether paid, settled, or unpaid.

    You should negotiate a settlement for as little as you can. You can probably settle for 25% ot 50% in lump sum, depending on how old the default. Forget payment plans. It’s better to wait and save up for a lump sum offer. Get any settlement agreement in writing before you pay and do not give the collector direct access to your bank account.

    To improve your score, you need at least 24 months of consistent, on time payment history. If you don’t have an open, active line of credit, get a credit card even if you have to get a secured card. Use the card, wait for the statement, and pay the balance in full every month. This will build your credit and avoid interest.

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