First Premier is definately not budging on the PFD. So, my two choices for this are: PIF ($460) and have it reflect as a PIF charge off...or settle for $231 and have it reflect so. What would all you fine people of myfico do?
If you can afford it, PAY IN FULL. Certain instances where it may come back to bite you if you settle for less than what is owed, like some government background investigations. If you can't afford it, then settle and be done with them.
I have dealt with them; PIF and have them update it with a zero balance. First Premier does not sell the debt and this amount is most likely factored into your utilization. Paying it in full could possibly increase your score as your utilization will decrease. The CO reporting has done permanant damage to your report. If you pay in full, it will reflect such and show future creditors that you did do your due diligence and pay the debt in full.
In summary, pay in full and allow them to update it as Charged Off/Paid In Full. Afterwards, start goodwilling them some letters; maybe you might just catch the right person and it may be deleted.