Paying Charge-offs

[Anonymous]

Hi there. This is my first post and I'm currently rebuilding my credit (560 to 661). I still have two derogatory accounts that remain on my report.

One is an auto loan (installment) with a balance of  approximately $6,000. It was last reported 05/16, and still lists the OC, even though I get contacted about paying it off by another agency? It does not show as a collection. I have a few questions about this account. Will it ever show as a collection with the agency that has contacted me? Also, Is there an advantage to settle with them? If so, is there much difference between settling and paying in full at this point? They have sent an offer for about half of what the full amount is. Worth mentioning may be that I don't have enough to pay the settlement in full at the moment, but could easily manage a payment plan. I could do this for the full amount as well. I don't plan on applying for a mortgage anytime soon, but possibly another auto loan within the next three years. Obviously a PFD would be ideal, but I don't think that is within reach.

The second account is an old credit card (revolving) with a balance of about $1,000 still reporting monthly as a charge-off, initially delinquent 11/15. I believe this amount reflects with my credit utiliuzation on my Experian (634) because it differs from my TU (661) and EQ (661). It's the only difference I've found between the reports. I can pay this in full, and would love a PFD, but it's with Wells Fargo, and I've read there isn't much luck in that department. Is there a best course of action here? I assume pay in full, then send a GW letter asking for removal of some of the delinquency?

For reference, I was able to obtain a CapitalOne QuicksilverOne card in January with a $3,000 limit that I upgraded yesterday to the Quicksilver over chat and increased the CL online to $3,300, as the representaive said I would still be eligible after the six month mark for further CL increase. I also bank with US Bank and have a secured card ($300) that has been open with good standing since 10/16. I have been keeping my total utilization at or below 9%.

I'm attempting to obtain a travel rewards card ASAP since I fly at least three times a month.

I appreciate any and all information. Thanks in advance.

[Anonymous]

I am by far no expert as I have only been paying attention to my credit for about 2 months now.  

However, initially I did have 2 collections,  and I paid them both off last month and all cr reports jumped about 40-50 points after that.   So,  I think it is wise to pay off anything from your past that is under 3 yrs old.   Mine both were.   I did dispute BOTH collections after I paid them off and they were removed within 2 wks. 

Someone with more experience may come in here and tell you otherwise but in my mind, I owed it, they were legit collections and I knew this.   I just personally preferred to pay for what i owed and move forward.   My credit scores all went up so I was "rewarded" for my good behavior  haha

[rmduhon]

For the first one, is the collection agency reporting it? If not, then you can't do a PFD because there is nothing to delete. In that case, you can request an agreement to not report if you pay them. Once an account is charged off if can become a collection at any time which will further damage your scores.
For the second one, if it's being factored into your UTI (and it probably is), updating monthly, and is still a charge of fid take care of it as soon as possible even without a PFD. That way it stops it from becoming a collection, it's removed from UTI calculations, and stops the monthly updating (after the update to paid of course). Your scores will recover faster after the last 2 reasons. Not as fast as getting it removed but faster than waiting to tend to it.

[Anonymous]

Thanks for the response.

The first one is not being reported by the collection agency, and has not been updated since 05/16, but they call me. I found that odd. Is there a reason the collection agency wouldn't be reporting to the credit bureaus? If an agreement to not report if payments are made is possible, I will definitley do that. Is there a best possible way to go about that? Responding in writing to their offer, asking to come to a non-reporting payment agreement, and getting it signed?

Also, thank for the confirmation on the second one. I'm setting up a payment Monday.