29 point drop for paying off bills!! How can that be???

[blackswan22]

Ive been reading different threads for months but now Im just completly lost and discouraged. I would like to purchase a home next year. My score would have to be 640 as of now my scores are 550 Eq. 595 Trans and 608 Exp.

Im so confused because Ive paid off close to 14,000 in debt including all of my collections and rather than my score going up it has decresed!!

I paid off my car and collections and this happened:

-29 point with equifax

-6 point with Experian

-14 with Trans Union

i dont get it. Before the decrease my Equifax score was 597, Experian score was 608 and my Transunion score was 614. In December it will be a year since i have had no late payments. 2 collections accounts popped up in September (this month) and i paid them right away. When i moved i did not forward all my mail. totally my fault but I guess even though they were added and paid in the same month it wouldnt be right to not deduct any points? (sigh)

My credit cards are as follows:

Cap One zero balance credit line of $1,351

Cap One Zero balance credit line of $500

Cap One Zero balance credit line of $6000

Cap One $114.98 balance credit line of 12,500

Amex $81.97 balance credit line of $15,000

I thought by having small balances and a huge amount of avail credit would help my score but instead it dropped.

I also have 68,000 in student loans that are pays as agrees

Im very frustrated and at a lose. can someone help me??

[Anonymous]

Unfortunately, when you simply pay them, and they update, they look like 'fresh' collections to the scoring algorithm. Since they are paid, they will no longer be updated and as they age they will have less effect on your score. How fast that aging will help you out, I have no idea. Some say 2 years. This is why its always recommended to ask for PFD when you pay a CA and get it in writing. BUT the good news is that lenders would much rather see paid collections rather than unpaid collections regardless of score.

Now at this point, you can try sending Goodwill letters asking the creditors to delete the tradelines. Search the forum for examples of this. Generally you need to have a good reason for why you became delinquent and how you have changed.  Keep in mind that you are asking them for a favor.

If any of the collections were medical, Google for "hippa + medical collections" for advice.

[blackswan22]

Thank you, all of my collections were medical. How can HIPPA help me??

[Anonymous]

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@blackswan22 wrote:

Thank you, all of my collections were medical. How can HIPPA help me??

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For medical collections- try calling the collection agency and seeing if they will delete. I made the same mistake and paid of medical collections and it didn't delete them. So I just went back and called them and asked them to remove it. 2 said yes and one deleted it while on the phone, 1 said yes and then couldn't find record of my account so I disputed it with the credit bureau and it came off, and one other said write a letter requesting it and they would then remove it.  I have had good luck with medical collections. Everyone else... no goes :/

[Anonymous]

Its a controversial topic, and not allowed here. Google it. Look for the links to creditboards.com.

[blackswan22]

ok i will google it thank you