@jarmll wrote:Does it impact your score once you start making payments and the balance owed decreases?
It could, if the account wasn't already updating regularly prior to you starting payments and the CA/OC reporting said payments every month. It could cause a score drop because the FICO algorithm would see the new activity as a "fresh" derogatory (even though it's not, obviously) and hit you with a "catch up" penalty. This would only be temporary, though, and eventually you'd recover those points and more.
If, however, the account has been regularly updating every month to show the derogatory status, then as the balance goes down and it crosses utilization thresholds (88.9%, 68.9%, 48.9%, 28.9%, 8.9%, and finally 0%), you could potentially see some boosts.
Note the above only applies if its a charged off account reporting. If it's a collection, there would be no score bonuses as you pay it down, most likely not even once it's paid down to zero.
Paying collections over time and then paying it off doesnt do anything scoring wise. It will look better that you paid your debts. It appears you already spoke to them. Call again and ask for pay for delete. Only score it helps is Vantage like Credit Karma which doesnt count paid collections.
@Ilinferno wrote:
@FireMedic1 wrote:Paying collections over time and then paying it off doesnt do anything scoring wise. It will look better that you paid your debts. It appears you already spoke to them. Call again and ask for pay for delete. Only score it helps is Vantage like Credit Karma which doesnt count paid collections.
I may be remembering incorrectly but I feel like I read on the forums that paid collections also don't count against you on FICO 9, but I could be wrong. This could help if you were looking at getting in with a lender who pulls FICO 9 such as Navy Fed. Either way your best option is pay for delete.
Your correct on FICO 9 with paid collections.