Pay off $2000 regular balances or $2000 medical collection?

[Anonymous]

First, thank you for helping out on this Forum... so many things new to me that I never knew.

I Have to increase my Fico Score ASAP to have the biggest impact possible to increase my score 21 to have a 620 with Equifax.  Transunion is 660 but Mortgage refinance says they use score in the middle. 

I have 3 medical Bills in collections in Collection status from Collection Agency which stemmed from fractured foot at Orlando park on 12/25/2007.   The Park is sending me a check and settlement letter for the accident which will allow me to pay off the medical debt. 

Where is the biggest increase on my Fico going to occur?? In paying off 3 Good Standing credit card and loans or Getting the 3 Medical Bills paid and getting the Collection removed? 

I paid a small $42 related amount and the Collection Agency would not remove it from my credit.  But I am hoping for a change of their mind now that I have the Letter from the Orlando Park of a Settlement.  I can only pray on this one.

But regarding the others, if I do pay the Medical rather than accounts in good standing, do I pay Original Doctors or the Collections Agency if I get their written promise to delete it off my credit report?

I just need 21 points ASAP ... so I would soooo appreciate your help with the best strategy to achieve that ...

Again, thx 4 all you do..

[Booner72]

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@Anonymous wrote:

First, thank you for helping out on this Forum... so many things new to me that I never knew.

I Have to increase my Fico Score ASAP to have the biggest impact possible to increase my score 21 to have a 620 with Equifax.  Transunion is 660 but Mortgage refinance says they use score in the middle. 

I have 3 medical Bills in collections in Collection status from Collection Agency which stemmed from fractured foot at Orlando park on 12/25/2007.   The Park is sending me a check and settlement letter for the accident which will allow me to pay off the medical debt. 

Where is the biggest increase on my Fico going to occur?? In paying off 3 Good Standing credit card and loans or Getting the 3 Medical Bills paid and getting the Collection removed? 

I paid a small $42 related amount and the Collection Agency would not remove it from my credit.  But I am hoping for a change of their mind now that I have the Letter from the Orlando Park of a Settlement.  I can only pray on this one.

But regarding the others, if I do pay the Medical rather than accounts in good standing, do I pay Original Doctors or the Collections Agency if I get their written promise to delete it off my credit report?

I just need 21 points ASAP ... so I would soooo appreciate your help with the best strategy to achieve that ...

Again, thx 4 all you do..

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Hi there - You will likely have to do both.  You will have to pay down your revolving to get your score up to get to an underwriter.  (The score is your foot in the door).   Then to get the loan you will likely have to have the collections paid as part of the house approval.   Def. try to get PFD's for the collections.  A paid collection or an unpaid collection is scored the same - but a collection removed is a score boost ONLY IF it is your most recent collection, depends on it's age etc.  I've gotten 4 collections deleted and only one boosted my score.  (15 points) - but it  was the most recent derog.

Good Luck!  I'm also buying a house soon.  I just got 6 points today for paying only 1 of my 4 revolving accounts to zero.  It could be the magic Zero, or it could be that my utilization got to 29% finally.  I'm hoping for just ten more points to get the best mortgage option.

[Anonymous]

Thank You sooo much for the information, especially by providing the actual number of points that were achieved by each action... This really motivates me into action and direction!!  15 + 6 is 21 ... What inspiration!!  With help like this, I can get there!!  Thank You!!!!

A side note ... I thought that I could get the best interest rate for my refinance unless I had a really HIGH Credit score...   I am refinancing but I bet it would be the same with a new home loan, .... Try CitiMortgage as a lender or for pre-Approval.   My current mortgage is with CitiMortgage, They said as long as I have a Middle score of 620 from the 3 bureaus, that my interest rate will be the same as someone with a score of 780... at approximate 3.9% for a 15 year fixed ... a real and wonderful surprize to me .. they said that the only difference would be in the refinance fees which around to maybe, if I remember correctly, about $500 more .. which is nothing .... Phone: (800) 667-8424

Post please when you get that house!  Best of luck to you!

[Anonymous]

Typo -- should say ....  I thought that I couldn't get the best interest rate for my refinance unless I had a really HIGH Credit score

[Booner72]

Stagemother- I know you know this but I wanted to point out that everyone's credit profile is very different and unique.  So the specific score increases I got for what I did would not be the same for someone else. 

But, one thing I have found very helpful here is when people do share their score increases/decreases for actions whenever possible.

Good Luck, that is a great rate!