Collections vs Charge-Off?

[Anonymous]

I was speaking to a credit repair company whom my local CU deals with. I'll give you a breakdown if you haven't read any other of my threads.

Current Score: 570

Current Open Accounts: Cap1 ($500 limit - $0 bal), Kay ($500 limit - $0 bal), Car Loan (Paid on Time 2 years), Deffered Student Loans until June 2015.

Current Negative Accounts: $1300 CO tution, $600 CO Verizon Wireless, $4000 CO old CU (making payments, this is actually down to $3000), and finally a Collection Account with $500 from medical debt which I just PIF today.

I was told by the repair company that I can attempt a PFD or GW letter on the collection account, but the company already told me they don't do that. I paid it anyways so it shows PIF, and I'll attempt a GW letter in a couple months when it reflects on my reports. My main question is, the credit repair company I was speaking with said since the other 3 are actual Charge-Off accounts and not collection agencies, the chances of PFD are slim to none. Is this true? Also - will the original account owners settle for a less of an amount, or do only collection agencies do that? I want to pay these all down but want to know if it's even worth trying a PFD with CO accounts, or attempting to contact them asking for a settlement for less. Do people who do manual credit reviews actually look for PIF versus Settled for Less than owed? Do they care as long as the debts no longer open? I know aside from removing it my score won't raise, but I'm focused on paying what I owe, and if I can at least settle for less with CO accounts I'd like to.

Thanks..

[RobertEG]

Yes, a creditor can agree to delete their reporting of a charge-off.

Reporting of a charge-off is, for all intents and purposes, the placing in a consumer's file fo the fact that, at a certain point in time, they reached the determination that he consumer was not likely to pay the debt.  That is obviously not a very conducive perception of a consumer, as it represents a stated loss on the debt.

Most COs result from prolonged period of non-oayment, which supports a finding that thet debt is increaslingly unlikely to be paid.

If the consumer eventually pays the debt, that does not result in removal of the prior reporting of their charge-off, but does somewhat negate the earlier perception that the consumer stiffs their debts. 

A settlement for less is better than non payment, but still represents a loss for the creditor.  The fact that a consumer paid only a portion of obligatied debt notifies future creditors that the consumer might seek to pay less than the full future debt they incurr, and if that pattern is repeated, lending to them may result in a loss.

That is a fact of which I suspect most creditors take note in their lending decisions.

Other than $ out of pocket, a PIF is best, as it demonstrates that the consumer ultimately honors their full debt obligation.

[Anonymous]

Alright so I will PIF my final 3 CO accounts since it will look better on a manual review, but this will have no impact on my score, correct? I can attempt a GW letter, or should I do PFD first? thanks-

[Anonymous]

Good news! Checked my actual Experian report and my Experian score is showing as 617 and not Credit Karma/Cap1 tracker (transunion score?) of 570! I need to find out what my EQ score is now to get an actual understanding.