Mega Contributor
Posts: 17,456
Registered: ‎03-19-2007
Re: will paying off a charge off improve score?

The impact, in my opinion, is far more than your FICO score.   Not paying it, if they do a manual review, may be a show-stopper for any prospective creditor, regardless of your three digit score.


A CO is, in its initial reporting, a posting to all that not only have you been delinquent in your debt, but that your delinquency has reached the stage that, in the creditor's opinion, you are not going to pay.  The accounting term is "uncollectible."


Paying can show them incorrect, and demonstrate that paying your obligated debt is important to you.

Not paying simply reinforces the negative observation made by that creditor.

Being under a payment plan does offset that perception.....