Rebuilding Your Credit

[tri3nity]

I'm trying to decide if I should start making payments on some of my debts to lower the balance or if I should just call and negotiate settlements. Does anybody know if when I pay a settlement will it hurt my score or will it start the debts all over again if I PIF or settle? What should I do?

[slyhouse08]

PIF...or settlement...should show no score difference...settlement might be better as far as the money standpoint...but PIF might look better on your report for further lenders...ideally you should want to PFD...some might require 100%...and some may not...try to PFD...before you PIF...or settle...

[guiness56]

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slyhouse08 wrote:
PIF...or settlement...should show no score difference...settlement might be better as far as the money standpoint...but PIF might look better on your report for further lenders...ideally you should want to PFD...some might require 100%...and some may not...try to PFD...before you PIF...or settle...

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Not entirely true. Paying an old debt can update the account to a current status and drop your score. It makes it look like a new collection.

[tri3nity]

This is what I was thinking. I was thinking that the ones that happened "in my irresponsibility again" a couple of years ago, I would settle or pay in full. I dont want the ones that are supposed to fall off next year or 2010 to start over. Is there somewhere on the sight that I can find a standard pfd letter? I'm just gonna let sleeping dogs lay or is it "lie".

[slyhouse08]

In my personal experience...I had an old auto loan...car was stolen...I had to pay if off...it went to collections...I PIF...and it reported as current...and my score increase by almost 10 points...A collection is a collection...nothing can make it look like a new collection...the date opened will always be on the report...by old dedt...do you mean collections...or past due accounts...now paying something on an account can reset the SOL...but I don't think it will make it LOOK like a new collection...

[guiness56]

I am talking about DOLA. It can hurt your score, but does not always. The worst thing you can do is a settlement.

[tri3nity]

They are already charged off. there are 4 of them and they equal about $2200.00. They are not scheduled to fall off until 2013. 4 accounts from my divorce fall off next year and the other 2 in 2010. I have 4 new good accounts and I'm trying to figure out if I should pay the ones that are the most recent

[guiness56]

Depending on your state, paying any payment on an old debt can reset the SOL.

What kind of debts are they and what state are you in?

[tri3nity]

I'm in Texas and they are all credit cards

[ByrdMan]

tri3nity, look under frequently requested threads in GC. There are PFD letters there.

ETA: Frequently requested threads at the top of this board too.

Message Edited by ByrdMan on 04-30-2008 10:07 AM