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Paying off collections help with future approvals. Especially when a lender does a manual review, they can see that one has taken care of their previous credit obligations. 2021 is a long time to wait to have them drop off your reports.
Getting sued as you have mentioned.
Wage Garnishment/ Having your bank account frozen.
Difficulty to gain/obtain new credit.
Just because a collection company does not offer or willing to do a PFD , does not mean that one should not take care of the debt. Please remember that not all collections companies and OC offer PFD.
I can testify that paying off collections is worth it. You may have luck with deleting them later, although PRA is not known for that. Still, paid collections affect your report, over time, much less negatively than they do if they're unpaid and open. They can also be updated regularly if they're open, thus dragging your score down continually.
As has been said, having active collections can inhibit your ability to get new credit, which is a key part of rebuilding.
Not to mention many CAs report the debt montly, which contirbutes to your "overall" debt, so decreasing that number helps too.
As has also been said ... it's a long game ... not a quick sprint. My credit has gone up 100 points across all three bureaus since February through a combination of new credit and paying off old debt
@hippychic823 wrote:
Just need to vent. I'm about to give up even trying, wondering what's the point. I have 3 accounts in collections with PRA. I called the OC's of all to try to PFD with them but I keep getting the same answer, they just refer me to PRA and tell me they no longer own the account and have no access to my info. When I call PRA to try to PFD they say absolutely not. Then I read that paying collections does nothing to improve your score unless they get dropped or age off. So now I'm just frustrated and wondering what's even the point of trying to pay all this off if it isn't gonna help my scores until they all fall off in 2021. Other than avoiding getting sued what's the benefit in paying off collections if it doesn't even help your score
It may not improve your score, but it improves your PROFILE, and THAT is what credit approvals are based on - the score is only one component of your profile.