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The chargeoffs alone are 33k and will fall off your reports in a few years. Unless you have gotten an amazing job and are making 300k or more a year, it's hard for me to imagine that paying off all these derogs is worth it. Have you thought about just allowing time to take care of it all?
My understanding is that paying off collections while still having COs on your reports won't help you much -- if at all.
You don't mention how much it would cost you to pay off the collections. Nor do you mention the dates of the collections. Or whether you have any serious lates and if so when these happened.
It may be easier for you to get better advice if you give people all the details.
@Anonymous wrote:My understanding is that paying off collections while still having COs on your reports won't help you much -- if at all.
This seems to be true, at least from my experience. When i first started working on my credit several years back, I paid some collections down before ultimately geting them reoved from my reports or them falling off. Once paid, there appeared to be no change in score. Only maybe an updated status.
Total CL: $321.7k | UTL: 2% | AAoA: 7.0yrs | Baddies: 0 | Other: Lease, Loan, *No Mortgage, All Inq's from Jun '20 Car Shopping |
@Anonymous wrote:
Thanks for the response, CreditGuyInDixie, please see below
Spouses collections
Med Coll- 339.00 - CO 11/16
Med Coll- 285.00- CO 02/15
Med Coll- 228.00- CO 02/18
Med Coll- 70.00 - CO 06/14
Med Coll- 253.00- CO. 04/ 13
Med Coll - 126.00- CO 04/13
Med Coll- 50.00- CO. 07/16
Fingerhut - 124.00. CO. 07/14
Spouses Derogs (closed with balance)
First Premier- 444.00 CO 6/17
Auto - 12,000- CO- 2/15
Self:
Collections
Med Coll- 98.00 CO- 5/18
Auto insurance-399.00 CO 2/16
Fingerhut- 98.00 CO 05/14
Major derogs- (closed accts with balances)
Auto (same as spouse)12,000 balance CO 2/15
Auto 15,000 balance CO 7/18
Boat- 7700 balance CO 2/15
First, I do not know your fianancial situation so I do not want to assume anything here about what you can, or cannot do. So, assuming you both have average income I would personally attack it this way just to get the ball rolling:
Spouses Collections: (8 total = 1475.00), I would try and pay off and/or try and ask for PFD.
Spouses Derogs: First Premier- 444.00 CO - Pay Off and/or ask for PFD
Auto - 12,000: Hold off for now
Your Collections: ( 3 total = 595.00) Pay off and/or ask for PFD
Your Major Derogs: Hold off
For these, you are looking at $2500. That isn't crazy unobtainable. You take care of that and you will have handled 12 of 16 accounts!! That's a big deal if you can do that. Then, the last 4 are some huge ones, but you can come up with a plan for those, but wait until you handle the others. Take it a step at a time. I did not have nearly as many accounts or the balances involved like you do. But I did learn it is easiest to attack what you can handle first. Trust me, as you start seeing things get taken care of and possibly falling off your reports, you will feel a sense of growth and this will push you to keep moving forward. Next thing you know, you are on a roll. The key is to be patient, but persistent.
Total CL: $321.7k | UTL: 2% | AAoA: 7.0yrs | Baddies: 0 | Other: Lease, Loan, *No Mortgage, All Inq's from Jun '20 Car Shopping |
Less dirt (derogs) on your CR is always better, even if your scores stay the same. OP, keep in mind that due to diminishing returns as stated earlier by CGID even if you were to get a bunch of your negatives removed, it's unlikely for your score to improve much if at all until your last major derog is removed. That doesn't mean however it isn't beneficial to remove negative items. Upon a MR, seeing less dirty accounts is always a better thing.
@Anonymous wrote:
@Anonymous for all the responses and given advice. I actually have a plan to clean up all of the collection accounts for now. I know for a fact that 95% of the medical collections can be PIF @Anonymous% and deleted from all CBs. The First Premier CO , not so easy. I had to settle with mine , so a GW campaign will be in order. I do know for a fact that 95% off all the collections will be PIF within the next 3 to 4 months. As far as the large derogs are concerned they will ultimately have to wait for some time before any attempt is made, with the exception of the 12,000 , which I am pretty sure I can settle for next to nothing, which will zero out 1 of my 3 large derogs, and zero out my spouses only derog, leaving her with no collections owed and and no charge offs owed. I understand that the negative tradeline will still be there, but like you said , under a MR ,will look better anyways. My overall issue is whether or not this would really be worth the expense to pay the settled 12k derog given the age of it , or would the money be better spent on obtaining a few Secured cards and adding positive tradelines to both of our files?
The answer to that more depends on your personal preference and situation. Myself, I would rather try and get all of the debt paid off for the reasons that BBS mentioned. Lenders can still see that you at least paid the balance if the item is on the report. Now, if you think that it is likely impossible to pay down the high dollar derogs, then you have a decision to make there. You can put our money towards something else if you choose. Eventually the account itself would fall off the report, but issues about the account could still surface.
Total CL: $321.7k | UTL: 2% | AAoA: 7.0yrs | Baddies: 0 | Other: Lease, Loan, *No Mortgage, All Inq's from Jun '20 Car Shopping |