URGENT: How does a collection of $200 affect my credit score?

[calibu0n]

The airline had this funny cancelling fee that wasn't on the contract charge to my credit card account. I was sucessfully disputed the amount of $200. Now they are coming back to ask for $200 and I tried to negotiate with them that I could only pay $100 to settle this because I'm a poor student. They didn't agree and said if I don't pay $200 by this Wednesday, they'll put me in collection. I'm aware that I have a good credit score (740), so how does this decrease my score? And by how many points?

Thanks in advance. Please give me your inputs.

[apandabear]

It'll probably hurt a lot. People have gone from clean reports (no baddies) to 1 collection and seen 100pt drop.

Any collection over $100 is going to hurt you the same. Doesn't matter if it's $200 or $5,000 for scoring purposes. 

I'd pay that off if possible. Borrow money from family, friends, do what you have to do.

[jamesdwi]

work on PFD,  paying it off does no good if the collection stays on your record for the next 7 years. 

[calibu0n]

Thanks guys.

Hi jamesdwi, what's PFD? I'm not in the collection yet. They said if I don't pay it by this Wed, they'll put me to collection

[Anonymous]

Which airline is this with?  I thought all airlines had cancellation fees (except for within 24 hours of booking).

Also, you mentioned that you successfully disputed the charge.  Who did you dispute it with?

[jamesdwi]

PFD pay for delete. if it hasn't reached your report yet, you may want to pay it if its yours. Since its a small amount, it can effect your credit for the next 7 years, the real damage is in the first  3 years where it can easily cost you in increased interest, lower credit limits, denied cards. 

[calibu0n]

Hi SanFranMatt, it was with China Eastern airline. When I came to the airport, they didn't let me get on board because I didn't have the passport. FYI, my flight was from Los Angeles to China for transfering flight to Vietnam. This airline is the only requiring a passport. I checked on their websites and Orbitz, there was nothing saying that a Passport is a MUST to travel. In the past, I traveled with my Green Card with no problem. I then disputed it with Citibank and it was credited back to my account. I didn't agree to pay because I thought their information was not clear. Now I tried to negotiate and settle with $100 but Orbitz don't agree.

[compassion101]

If they can't convince the crfedit card company that it is a valid charge, then it probably isn't. If they still feel it is then they should fight the dispute with the CCC. That's one of the advantages of using credit cards.

Basically, it sounds like you are correct to not pay within the system. That said, it's a dangerous game to play chicken facing a potential collection that could hurt your credit over a relatively small amount so decide wisely.