I received an offer from a collection agency to pay off a debt "in full" for 50% of the amount owed. I sent them a PFD letter stating I would pay them the 50% for removal of the account from my credit report and that I laid no claim to the debt, but wanted the issue resolved. They called me back and gave me the whole "we don't have to honor the 50% payment option but as a FAVOR to you we'll still accept 50%" but that they couldn't do a PFD because it was against the FCRA. What should I do now?
What to do next depends upon what you are seeking.
They have offered a settlement for less than the full debt. If you accept, you will eliminate any chance of future legal action (assuming the debt is still within SOL), and improve your CR upon manual review by showing satisfaction of the debt. You save money by not paying the entire debt. That may be important to a future creditor. And, of course, you save money by not paying the entire debt, and "do the right thing."
On the negative side, lack of CR deletion will continue to include the collection in your scoring. Additionally, settling for less will permit them to post an additional special comment in your credit report notifying others that you did not fully satisfy the prior debt. That alone is a negative in a manual review.
What you can do? You could, if so inclined, argue their statement that deletion is "against the FCRA," since it is not. However, a PFD offer is a type of GW request, and I doubt that arguing the correctness of their reason will foster much good-will. It is contrary to their credit reporting agreement with the CRA to delete on the basis of payment, but whatever their reason is, it is their decision.
Personally, I would make them an offer to pay at the 50% agreed level, but with the additional condition that they not report a special comment of "paid for less."
The total for the debt is around $400. Not to sound pompus, but I can pay in full with cash if I wanted. I'm only concerned about the impact to my CR at this time since I've been wroking for years to clean it up and this is the last fly in the ointment. If I did decide to pay in full, should I contact the original creditor as opposed to giving the collection agency any money?
If you PIF, it would make no difference. Your CR would arrive at the same point.
OC reporting current status of Paid, current debt balance of $0.
Debt collector reporting collection account closed, $0 debt under collection.
Who you pay will affect the order to that reporting, but one has to notify the other after the debt is satisfied, and ultimately the final reporting will be the same.
How old is this debt? Or do you know the date it will drop off your CR?
Do you know the DoFD (date pf forst default) from the OC account reporting?
DoFD can be found on a EQ CR. Date of removal are on EX and TU CR's.
With this debt only being 4yrs old,if by chance you can get it deleted,you may receive a score increase.
IME with CA's, some do say they will not delete upon payment, but will delete when asked after payment.
Good Luck to you