Paying on bills but still sent to collections

Anonymous · ‎02-13-2010

Hi All,

Thanks in advance for your help. I have been searching the forums but am not finding an answer for my particular problem.

I have 7 different medical bills that I am paying a small monthly amount. Some of them are mine some are my husbands. Six of them I only pay $10.00 a month on because that is all I can afford to pay right now. I have these payment set up through my bank to be automatically paid every month. Total of all bills have been paid down to $1020.00.This amount will be $920. by the end of the week because it is too late to stop the automatic payment. I foolishly thought they wouldn't do this if they were getting something every month. I have been paying on these since Sept. '09. I received collection letters for 3 of them today. Letters are from the same CA for the same Dr.office and hospital. Total for the 3 are a little over $400. which I can't pay off right now. Next month I would be able to increase the payment for 2 of them as I will have 2 of the smaller ones paid off. I want to keep these off of our credit reports because we are trying to buy a house. They are not showing up yet and the letters say I have 30 days to respond.

We were pre-approved to buy a house in Sept. but one thing after another has hindered us from being able to close. Now we are going to have to start the whole process over and can't afford for our credit scores to go down. They have actually gone up since Sept.

So my questions are:

What is the best way to prevent these from showing up on our credit reports other than paying them off?

If I do manage to get the money to pay them off, should I send to the OC?

Do I acknowledge receipt of the collection letters in any way?

If I pay will they still be reported by the CA?

Again, thanks for your help.

Anonymous · ‎02-14-2010

Hi Analytical1! Welcome to the myFICO forums!

You've made it clear that you've been paying these medical balances down every month, but did you work out some 'official' payment plan with the original provider? What I mean is, most medical bills are due upon reciept-- if you didn't work out an alternate payment plan with the OP, then they might consider the lack of payment in full to be 'default'.

If you didn't work out an official payment agreement, the first thing I'd do is call the OP and ask for one. Explain your situation, and ask they they pull it back from collections.

If you did have an official agreement, and you've been paying less than what was previous agreed, again I'd call, explain the hardship, and ask for a more affordable payment plan & to pull it back from collections.

See what the OP says before tackling the CA. If you just received the dunning letter, you've got a little time to respond within the 30 day window. That doesn't mean, however, that they won't report, unfortunately. But, there's still some options if they do. I think you should first see if the OP will pull it back from collections-- I think that's your best bet, since you have been paying.

Jazzzy · ‎02-14-2010

I agree with the above advice. See if you can tackle this with the original creditor. Hopefully they can pull it back from the collection agency.

I congratulate you for trying to get this paid off. Let me just insert the idea here that this may not be the most opportune time for you to be buying a home. Do you have downpayment dollars put away? If you do, I'd use that money with the original creditor and get that $900+ paid off.

Home ownership is VERY expensive. I know there are a lot of people buying right now to get the $8k tax credit. That, in my opinion, is no reason to buy now. In our area, we are seeing home prices artifically supported by the tax credit. If it expires, you may save much more than that $8k in the long run. Don't be premature and make a move that could really hurt you if you're not ready.

GregB · ‎02-14-2010

I strongly agree with LynetteM. However, real estate is very regional in nature and that counts also. I'm in Southern California, east of LA.

I see many people bidding up houses MORE than $8,000 so as not to "miss" the $8,000 credit. The knowledgeable long term real estate investors are NOT buying as prices are still high. The only reasonable deals around here are on the high end.

When the expected spring rush to buy doesn't happen, you will see a bunch of price drops. Unless you are in an area that is very different, have some patience and get your finances worked out......

I also agree that home ownership has many hidden costs.

Anonymous · ‎02-14-2010

LiMirth,

Thanks for your response. I did not have an agreement with them but I have been going to the same Dr. for years and have always been able to pay a little at a time without any problems, however, last year they started using a different billing service. I should have made the arragements with them, but as I said before, I foolishly thought it would be okay. I will not make that mistake again.

I will call the OP in the morning and see if it is possible to get them pulled back from collections. If they say they will and we can agree on the repayment amounts, should I ask for something in writing?

If they won't or can't pull them back from collections, should I try and pay the CA and get something in writing from them to keep it off of my credit report so that it never makes it on my report at all?

Jazzzy · ‎02-14-2010

@Anonymous wrote:
LiMirth,

Thanks for your response. I did not have an agreement with them but I have been going to the same Dr. for years and have always been able to pay a little at a time without any problems, however, last year they started using a different billing service. I should have made the arragements with them, but as I said before, I foolishly thought it would be okay. I will not make that mistake again.

I will call the OP in the morning and see if it is possible to get them pulled back from collections. If they say they will and we can agree on the repayment amounts, should I ask for something in writing?

If they won't or can't pull them back from collections, should I try and pay the CA and get something in writing from them to keep it off of my credit report so that it never makes it on my report at all?

I would ask for something in writing if the OC can take the account back and will agree to take payments. They don't have to give it to you, but it doesn't hurt to ask.

If they won't pull it back, you should request a pay for delete (PFD) from the CA. You are correct that this is done in writing, and it must be done before you pay them anything. If you pay them before you have a written agreement from them, you have no leverage. Also, make sure the agreement does not simply say that they will record that your collection is "paid." A paid collection hurts your FICOs just as badly as does an unpaid collection. You want it deleted upon payment...not just marked as paid. If you do a bit of research in the Rebuilding Your Credit forum, you will find examples of PFD letters.

Anonymous · ‎02-15-2010

Ok, I called them this morning and they told me I needed to call CA, that could not pull them back. So...I have found a way to pay this off if i need to but I need to know do I send a PFD now or wait until it actually hits my report. Or should I do the DV first? If so, do I do it now or wait until the 30 days are up. I also read some where on here to send a cashiers check to OC and see if they would cash it along with a letter. What's the next best step to take.

Thanks for your help.

Jazzzy · ‎02-16-2010

@Anonymous wrote:
Ok, I called them this morning and they told me I needed to call CA, that could not pull them back. So...I have found a way to pay this off if i need to but I need to know do I send a PFD now or wait until it actually hits my report. Or should I do the DV first? If so, do I do it now or wait until the 30 days are up. I also read some where on here to send a cashiers check to OC and see if they would cash it along with a letter. What's the next best step to take.

Thanks for your help.

I am giving this a gentle bump to the top because I want some expert eyes looking at this and giving opinions. I have never done this, but this is what I think...

If you can pay these collections, I would do so before they hit your credit reports. Right now a PFD isn't necessary because they aren't on your credit reports...so, there's nothing to delete.

If I am wrong on this...someone please let me know. I think that time is of the essence because you want these paid so that they don't report.

laz98 · ‎02-16-2010

that was my thinking as well, lynette.

Anonymous · ‎02-23-2010

@Anonymous wrote:
Ok, I called them this morning and they told me I needed to call CA, that could not pull them back.

Who did you talk to when you called? If it was a receptionist who answered, it's possible they just told you that to get you off the phone because they'd rather deal with the people there in the office coughing and hacking.

If you haven't already, call and talk to the business office of the doctor. Tell them you can PIF and offer to bring certified payment to their office.