Question about Collection Agency Payment

Anonymous · ‎01-07-2010

Hello,

My husband and I are in the process of shopping around for mortgage loans (we're going to begin looking around on Monday). Today I get a phone call from a collection agency stating they just recieved my account this week. The CA said the account has not been reported to the credit buerus. My question is...should I pay the CA directly in full (will that hurt my score, since it was never even reported?) or try to pay the creditor in full (it appears that I can still make a payment online).

Thanks!

Samantha

Anonymous · ‎01-07-2010

Can anyone offer their advice/experience? Thanks

ProudMomof5 · ‎01-08-2010

If it's not on your credit report then it won't hurt your credit score at all. Before you pay anything get something in writing from them. Also, when collection agencies buy accounts they pay about 2% for them. If I were you I would ask them if their willing to offer a settlement amount. They usually offer settlement amounts and they're usually about 60% of what's owed.

Jazzzy · ‎01-09-2010

Hi Samantha...how old is this debt?

Are you saying that you still see the debt online with the original creditor? Who is the creditor? Is this showing on your reports with the original creditor?

Anonymous · ‎01-09-2010

@ProudMomof5 wrote:
If it's not on your credit report then it won't hurt your credit score at all. Before you pay anything get something in writing from them. Also, when collection agencies buy accounts they pay about 2% for them. If I were you I would ask them if their willing to offer a settlement amount. They usually offer settlement amounts and they're usually about 60% of what's owed.

Right, I know right now nothing is reported but my concern is that if I pay the CA directly it will show on my credit report that I didn't pay the original creditor but instead it went to collection and I paid the CA.

Message Edited by SamanthaHay on 01-09-2010 05:57 PM

Anonymous · ‎01-09-2010

@LynetteM wrote:
Hi Samantha...how old is this debt?

Are you saying that you still see the debt online with the original creditor? Who is the creditor? Is this showing on your reports with the original creditor?

Hi Lynette,

I received a letter from the creditor mid-December saying that my account would be sent to CA within 10 days. When I called the original creditor to make the payment this week, they told me it had already been sent to CA. Yes, I see the debt on the original creditors website with the option to make a payment. When I called the original creditor directly they wouldn't accept a payment over the phone. The creditor is actually University of Phoenix. This debt is not a student loan, it's just a regular balance due.

No, it's not showing (or at least not yet) on my credit reports for the original creditor. Do you know how long it takes for something like that to show on CRs. My husband and I actually got pre-approval yesterday for the mortgage, so I know nothing's showing up right now.

Samantha

Anonymous · ‎01-09-2010

if you can pay the original creditor and fax proof to the CA that should cover it and keep them from filing a new report (and be easy to get removed if they were to do so)... But, you still might take a points ding for paying the old item if it re-ages the date of last activity. Not sure how that works on charge offs.

Anonymous · ‎01-09-2010

@Anonymous wrote:
if you can pay the original creditor and fax proof to the CA that should cover it and keep them from filing a new report (and be easy to get removed if they were to do so)... But, you still might take a points ding for paying the old item if it re-ages the date of last activity. Not sure how that works on charge offs.

I just made a payment directly to the original creditor through my online account I had with them. The payment went through fine and I have receipt that shows that I paid the original creditor directly. Thanks for your input mickie08.

Now I am wondering if the original creditor considers the account "charge off" since I did pay my debt directly with the original creditor..?

Jazzzy · ‎01-10-2010

@Anonymous wrote:

I just made a payment directly to the original creditor through my online account I had with them. The payment went through fine and I have receipt that shows that I paid the original creditor directly. Thanks for your input mickie08.

Now I am wondering if the original creditor considers the account "charge off" since I did pay my debt directly with the original creditor..?

I'm glad your payment went through. As to whether the University of Phoenix considers it a charge-off or not, you may have to wait and see what reports (if anything)...but, at least, making payment to the original creditor should keep the collection agency off your reports.

I assume you're monitoring your reports? If so, if the collection agency shows up, you will immediately need to produce the paid-in-full receipt from the original creditor. That should take care of the collection agency.