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Pay-off Collection account or get below 30% CC utilization?

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New Visitor

Pay-off Collection account or get below 30% CC utilization?

I currently have 1 account in collections and 3 credit cards over 30% utilization.

 

I can pay-off the collections account or make a big dent on my credit utilization.

 

Which one will have the biggest affect on improving my score?

Message 1 of 7
6 REPLIES
Regular Contributor

Re: Pay-off Collection account or get below 30% CC utilization?

How old is the collection account?

 

Message 2 of 7
New Visitor

Re: Pay-off Collection account or get below 30% CC utilization?

June 2017 portfolio recovery $1800
Message 3 of 7
Regular Contributor

Re: Pay-off Collection account or get below 30% CC utilization?

 

Greetings,

 

That's an important data point for anyone that offers advice..

IMHO with a collection that recent, it's hurting you more than the uti.

That said; others may have a different opinion so see what they have to say.

 

CHEERS

Message 4 of 7
New Contributor

Re: Pay-off Collection account or get below 30% CC utilization?

I would say pay the collection. Stop the bleeding and let your credit heal. Are they updating the file every month? I say try to get a PFD that will boost you bigger than the lower utilization.

EX 653 | TU 695 | EQ 695 (06/04/18)
EX 586 | TU 603 | EQ 575 (12/07/17)

Quicksilver - $3250
QuicksilverOne - $400
Discover It Secured - $300
Self Lender Account
American Express BCE - $500
American Express PRG
Message 5 of 7
Community Leader
Legendary Contributor

Re: Pay-off Collection account or get below 30% CC utilization?

Update of a collection that states it remains unpaid essentially results in FICO considering the period of delinquency to have been reported as now being longer, and thus effects scoring.  Is the debt collector updating monthly?

 

Additonally, the debt is likely still within SOL, and thus there is the possibility of filing civil action seeking a judgment.

Paying ends that possibility.

 

Paying down your balance on revolving accounts can be done at any time, and thus obtain a reduction in % util.

 

I would likely, on a recent debt, make a PFD offer, and thus both discharge the debt AND seek removal from scoring if they accept.

Message 6 of 7
Regular Contributor

Re: Pay-off Collection account or get below 30% CC utilization?

Portfolio is a debt buyer, they paid maybe 100 dollars for the account. You can offer 500 to settle. Start there 

 

I’m not sure who original creditor was. But I would look at agreement and see if arbitration is in contract. Then I would send letter electing arbitration. Personally, I would not pay a JDB 

Message 7 of 7