How to best handling Collection Account

[Anonymous]

Hi, I'm looking for the best way to immediately improve my credit scroe.  I have a collection account which posted to my credit report on January 2017.  I'm unable to pay in full at the time but may be able to in a month or two.  Would paying a minimum amount now and having the account status updated to "PAYING AS AGREED" have a positive or negative affect on my score?  OR should I wait until next month or thereafter to pay in full.   Kindest regards 

[medicgrrl]

A collection is never going to report as "paying as agreed" It will continue to update as a derogatory account until it's paid.  If you can settle it in the near future, I would wait until then to contact them.

[Anonymous]

Big thanks for that advice!!  I was told NOT to settle the account but pay in full.  Does a settlement on a collection account carry the same weight as a Paid in Full??

[medicgrrl]

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@Anonymous wrote:

Big thanks for that advice!!  I was told NOT to settle the account but pay in full.  Does a settlement on a collection account carry the same weight as a Paid in Full??

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The only time it may make a difference is during a manual review of your credit.  As for automated approvals, it shouldn't make any difference because it's still showing as a collection with a $0 balance.

[stargazer25]

Your best bet is to request a Pay For Delete for Paying In Full. Chances of getting it in writing is slim but check the forums for the collection agency name to see if they do PFD.

[RobertEG]

If they accept a settlement for less, that discharges the debt, and is legally the same as paying in full.  The debt is discharged, and the debt collector must update their reporting to show paid, $0 balance. 

However, the CRAs permit the reporting of an additional special comment when a debt is settled for less than its full amount.

That special comment of settled for less advises others that you have a history of not having paid your entire obligated debt.

That means that lending to you can result in a loss if you repeat your prior history of seeking settlemnt for less.

That is never a favorable comment when others are doing a manual review of your credit report.

The best outcome is to secure a PFD agreement, as that removes all reporting.

However, the next best thing is to secure a settlement for less, with the additional agreement on their part not to report any special comment or reference to the fact that they settled for less.  Your credit report will then appear the same as if the debt had been paid in full.

[Anonymous]

Thank you so much!!  I ended up paying in full before I could read your response.  Will make a mental note for the next one.  Thanks again!!  Would love to have this item removed totally but I guess in full is better than settled.

[Anonymous]

Thank you.  I'm fairly new to forums could you tell me what forum in particular I should search?  Is there a forum dedicated to this issue?  

[Adkins]

Search: good will letters - since you've already paid, your goal now is to get them to remove the paid collection from your report.

Search: PFD or pay for delete, on how to do that next time, before you pay in full