Is it possible to improve scores with large collections? Advice please!

[Anonymous]

Hi,

I have about $7000 in collections from Natl Crysis from broken apartment leases due to job cutbacks and job loss in 2014. I've been able to increase my scores out of the 490s now to the low 500s since June. I was able to get an auto loan through Toyota Financial (miraculously!) and payments start on the 15th of this month. I have a secured card through a credit union but it only reports to Experian and Transunion. I've been declined for pretty much every other secured card I've applied for...which I didn't know was possible, but still have a couple options left like OpenSky. Fingerhut is reporting positively as well.

Assuming from here on out I pay my bills timely and maybe open one more secured card, can my scores continue to increase? Or will the huge amount I owe in collections hold me back until they fall off in 5-6 years? I've got some other small collection accounts around $1000 total that I could pay off if that would help but the ones from Natl Crysis I've pretty much decided I can't pay any time soon since it's just such a large chunk of money even if I settle. What do I do?

[Anonymous]

http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/PFD-Q-amp-A-Examples-and-PFD-Success-Stories/...

How to "pay for delete"

as a fellow "dear god I'm in the low bracket" I am testament that scores will rise - the speed varies BUT ITS GONNA HAPPEN.

i can't offer much advice, except that I currently am sending multitudes of Goodwill letters to collection agencies and have successfully deleted one! So…it does work. 

As for another tactics, other wiser people roam this forum and will advise.

[Anonymous]

I had about $6500 in collections within the last year. Some got deleted and some wouldn't. I paid them all off. My score was high 400's to low 500's. After a couple deleted and the rest showing $0 balances. My score started to rise. After having 6 credit cards since Oct 2014 and 1 car loan. My scores are at about 650 as of 8/7/15. I also have a Bankruptcy on my credit from 2011. After keeping my UTL down on my cards below 30. My score has really been skyrocketing the last 2 months. If you can't get the company to PFD, I would setup a payment arrangement with them, I had to do that a couple of times. You tell them what you can afford to pay, don't let them tell you.

[jsantiago102]

I second that. I also sent a DV letter to a CA, Portfolio Recovery, and they deleted from my report! 

[Anonymous]

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@Anonymous wrote:

Hi,

I have about $7000 in collections from Natl Crysis from broken apartment leases due to job cutbacks and job loss in 2014. I've been able to increase my scores out of the 490s now to the low 500s since June. I was able to get an auto loan through Toyota Financial (miraculously!) and payments start on the 15th of this month. I have a secured card through a credit union but it only reports to Experian and Transunion. I've been declined for pretty much every other secured card I've applied for...which I didn't know was possible, but still have a couple options left like OpenSky. Fingerhut is reporting positively as well.

Assuming from here on out I pay my bills timely and maybe open one more secured card, can my scores continue to increase? Or will the huge amount I owe in collections hold me back until they fall off in 5-6 years? I've got some other small collection accounts around $1000 total that I could pay off if that would help but the ones from Natl Crysis I've pretty much decided I can't pay any time soon since it's just such a large chunk of money even if I settle. What do I do?

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i have 1 paid collection and 6 late payments (120+ days) from a Cap 1 card on TU/EX, my scores are 670/686.

6 late payments on EQ with no collection, EQ is at 700.   so yeah, get some revolving credits rolling then ur scores should go up.   the amount of the collection doesnt matter i think, a paid/unpaid collection have the same affect on your scores.  

[Anonymous]

So basically after an account goes into collections it doesn't matter if I pay it or not the damage is already done? I can put that money toward buillding for the future than trying to fix the past huh. I'd rather have a $7000 secured card than pay off months of leases.

[needtodobetter]

Just a warning about ignoring the debt....it's a lot of money. Due to the amount, there may be a good chance the creditor will sue. Then, you may be adding a judgment to your report. It seems like a newer debt, so it is very likely it is within SOL. If you can't afford to make payment arrangements, I would start putting aside some money in case they do decide to sue. Or, once you have a lump sum available, maybe they will settle for less.

It is really a downside of the scoring system that paying the collection itself off won't help improve your scores, bit a judgment will definitely create a scoring drop. Also, if you have any I intentions of purchasing a home while the debt is still on your report, the mortgage company will want it paid.

Just a ccouple of random thoughts. I wish you the best of luck!

[Anonymous]

As the collection ages, it will have less impact your credit score. As the previous poster stated, be cautious of ignoring the debt due to its' amount.

They say that you need 3 credit cards and 1 store card open for maximizing the FICO scoring model. The best way to offset a negative item is by showing lots of positives as payment history and utilization factor highly in your score.

Go to the Capital One pre-qual site and see if you can get a secured card (or maybe even an unsecured card). This company has been more than beneficial to many in the rebuilding process and typically provide an unsecured card after positive payment history with them.

Good Luck to you!

[Anonymous]

Like the posts above, you need to worry about being sued because they won't ignore that much money. Atleast make payment arrangements for $50 a month if you can. That way your showing them that you are wanting to pay. I would say try for a PFD, but who really has that kind of cash in hand lol. Like another post above, Capital One is the best at approving people for unsecured cards. They are good at giving you a chance to prove yourself. The pre qual site is top notch from my experience and friends/family.