Collections and where to go from the score drop ?s

[Anonymous]

Hi All, 

So in cleaning up my credit I have these 2 lingering medical collections that I am just about ready to pay so they can disappear. Everything else is at $0, UTI at 7%, paid off car which had 30 day late (2) which run parallel with the medical (2014 was not my yr), and student loans paid off never late. I know this sounds dumb but I'm leery of what settling will do since my score droppped significantly from paying off the SLs and car. Advice and answers are much appreciated, thanks.

[Anonymous]

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@Anonymous wrote:

Hi All, 

So in cleaning up my credit I have these 2 lingering medical collections that I am just about ready to pay so they can disappear. Everything else is at $0, UTI at 7%, paid off car which had 30 day late (2) which run parallel with the medical (2014 was not my yr), and student loans paid off never late. I know this sounds dumb but I'm leery of what settling will do since my score droppped significantly from paying off the SLs and car. Advice and answers are much appreciated, thanks.

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Your credit score dropped from paying off the student and auto loans because once they are paid off the account goes into a closed status which is similar to closing a line of credit, you lose the age and history of those accounts. Also if you don't have any other current installment loans on your credit then that is also causing the drop in your score. I believe FICO likes when someone's credit profile is reporting current loans being paid and active. When I got my first auto and personal loan they both increased my score 30+ points. 

[Anonymous]

I do still have one more installment loan but once those medical collections are off it'll be my last "reporting" negative item. Out of the blue they started reporting again in June. 

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@Anonymous wrote:

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@Anonymous wrote:

Hi All, 

So in cleaning up my credit I have these 2 lingering medical collections that I am just about ready to pay so they can disappear. Everything else is at $0, UTI at 7%, paid off car which had 30 day late (2) which run parallel with the medical (2014 was not my yr), and student loans paid off never late. I know this sounds dumb but I'm leery of what settling will do since my score droppped significantly from paying off the SLs and car. Advice and answers are much appreciated, thanks.

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Your credit score dropped from paying off the student and auto loans because once they are paid off the account goes into a closed status which is similar to closing a line of credit, you lose the age and history of those accounts. Also if you don't have any other current installment loans on your credit then that is also causing the drop in your score. I believe FICO likes when someone's credit profile is reporting current loans being paid and active. When I got my first auto and personal loan they both increased my score 30+ points. 

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[Anonymous]

I've had great luck with doing PFD when it comes to medical collections, just call them and explain sincerely what medically was wrong, then explain why you couldn't afford to pay it. Depending on the age of the collection and amount they may work out a settlement, even a PFD. I've removed 3 collection accounts this way that were medical. 

[Anonymous]

Oh wow ok I'll try that. Hopefully they are feeling generous tomorrow.

[Anonymous]

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@Anonymous wrote:

Oh wow ok I'll try that. Hopefully they are feeling generous tomorrow.

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It's your best bet honestly, I would also do research on that collection agency to see what their history looks like on doing PFD's for others. If they refuse via phone, try emailing the EO or sending a letter. Once you've exhausted all of those options I would try to reach for a PIF or settlement for less depending on the total, once you zero out the balance dispute it on all three credit bureaus, some collection agency's don't bother responding to disputes which will basically default it to being deleted.

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

Oh wow ok I'll try that. Hopefully they are feeling generous tomorrow.

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It's your best bet honestly, I would also do research on that collection agency to see what their history looks like on doing PFD's for others. If they refuse via phone, try emailing the EO or sending a letter. Once you've exhausted all of those options I would try to reach for a PIF or settlement for less depending on the total, once you zero out the balance dispute it on all three credit bureaus, some collection agency's don't bother responding to disputes which will basically default it to being deleted.

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Yet another great idea. I actually found a good amount of info on Optimum and PFDs just now. Super siked! Well have an awesome night and thanks again 

[rmduhon]

You don't lose the age of the account until it is no longer reporting which is generally around 10 years after closing/paying off the account. Since the collections are still being reported you need to pay/settle them (And start a GW campaign) even if you can't get a PFD because they're keeping your scores depressed.

[Anonymous]

Woohoo!

Well I called and spoke to a rep and got a PFD. It was a "nice" chunk of change but definately worth it in the long run. Thanks again for all the helpful suggestions everyone Now to watch these scores improve  

[medicgrrl]

My sister just dealt with Optimum. They were super friendly and easy to deal with. The lady emailed my sister a letter stating she would delete after payment, and they kept their word and deleted promptly. I would call them and start the process.