Quick question

[Anonymous]

I’m on the road to rebuilding my credit and I have a quick question.. I had two cards which I stopped paying years ago which was a credit one unsecured and a capital one secured card. The credit one card is in collections for $600 and the capital one card is closed/charged off as bad debt. But still reports 142% ($284) of my limit used. What do i do? Do I pay off the one that’s in collections and leave the closed account alone or?.. not sure what to do here.. any tips will be greatly appreciated

[Anonymous]

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@Anonymous wrote:
I’m on the road to rebuilding my credit and I have a quick question.. I had two cards which I stopped paying years ago which was a credit one unsecured and a capital one secured card. The credit one card is in collections for $600 and the capital one card is closed/charged off as bad debt. But still reports 142% ($284) of my limit used. What do i do? Do I pay off the one that’s in collections and leave the closed account alone or?.. not sure what to do here.. any tips will be greatly appreciated

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What is the Date of First Delinquency on both accounts?  You can find that by looking at your credit reports.  Depending on when that is, you may want to let those fall off naturally (7 to 7.5 years after DOFD).  Let's say the DOFD is from 4 years back, those accounts will haunt your CR's for 3 more years.  It may be best to pay those negative accounts off.  I have seen a few posts on this forum regarding having Credit One remove negative information through Goodwill attempts.  I know for a fact Capital One will not do that, so that will more than likely stay on your CR's for the full 7 years after DOFD.  But it will help your utilization out to have that paid to a $0 balance (either pay in full, or settle for less).  Having the paid charged off / collections account will look better to an underwriter when seeking new credit.

Do you know your FICO scores?

[Anonymous]

I’m looking at this information on credit karma which I know isn’t the best but it’s what I’m working with right now. My FICO score based on a denial letter from maybe 2 weeks ago is 550. I know the first date of delinquency is around December 2016 which was when I broke my ankle.

[Anonymous]

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@Anonymous wrote:
I’m looking at this information on credit karma which I know isn’t the best but it’s what I’m working with right now. My FICO score based on a denial letter from maybe 2 weeks ago is 550. I know the first date of delinquency is around December 2016 which was when I broke my ankle.

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Since these are fairly recent (~2 years) they will stay on your CRs for approx 5+ years. IIWUTM I would pay both of them off ASAP & do the GW attempts with Credit 1. It never hurts to try with Cap 1; the worst they can say is no, & you never know when they may change their policy & honor GW requests.

[Anonymous]

Do you recommend I settle for the offers they’ve already given me or pay in full? Will FICO Score me any differently if I just settle them?

[Anonymous]

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@Anonymous wrote:
Do you recommend I settle for the offers they’ve already given me or pay in full? Will FICO Score me any differently if I just settle them?

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What offers have they given you? You can always send them a counter offer, such as PFD or "Paid as Agreed". If they mark it as "Paid-Settled for less than full amount" it dings you, but not as much of a ding by letting them fester. Anything paid is going to score better than unpaid...

[Anonymous]

I know Cap1 has given me a $115 dollar settlement offer and Credit1 has sent me offers but I can’t recall what they were. I figured I’d just pay the $115 Cap1 offered me and see what I can get from Credit1. What do you think?

[Anonymous]

Pay the Cap 1 & find out what LNLV (Credit 1) is offering. You might have luck getting them to PFD. By paying them you will stop them from updating negatively each month & they can begin to age... GL!

[Anonymous]

Thanks man I appreciate the advice.

[FireMedic1]

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@Anonymous wrote:
I’m on the road to rebuilding my credit and I have a quick question.. I had two cards which I stopped paying years ago which was a credit one unsecured and a capital one secured card. The credit one card is in collections for $600 and the capital one card is closed/charged off as bad debt. But still reports 142% ($284) of my limit used. What do i do? Do I pay off the one that’s in collections and leave the closed account alone or?.. not sure what to do here.. any tips will be greatly appreciated

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Cap1 isnt that high of a balance. Paid is a lot better than setlement. If it were for thousand thats 1 thing. But its not a whole lot of money. For $70 difference your repots will say paid and not settled for lesser amount. Now when things get better and you want better cardfs. The UW will see that you didnt pay it off and settled for less being under $300? Pay it all.  Pay them all off so it will reflect paid in full, not settled for lesser amount. You may lose some $ now. But down the road it will look a whole lot better that you paid your debts.