I'm new to the forums but thought I might see if anyone had any opinions on my situation.
Some information about my: I'm 25, my oldest credit account is 3 years, I have 3 total credit cards, one installment loan (auto), and have never had any late payments of any kind. My utilization is low on my revolving credit lines. Recently, I received notice from a collection agency due to an unpaid ambulance bill for 2012 that I didn't realize was unpaid. Within one month, I paid the full bill ($2000 approx) but my credit score took a huge dive from around 750 to 630. I have low utilization and good payment history and all of my credit accounts are in good standing (aside from the collection).
Do any of you have any experience in this? I read that collections fall off after 7 years and they still negatively affect FICO scoring regardless of the balance of the account since it's a collection although I assume the paid debt is better than the unpaid debt since it won't show as a balance on my total credit.
Will I be able to get my score back up while this collection sits on my credit report? I can't really dispute the debt because it is definitely mine so I figure I'm stuck with the mark on my report. Would the best way to increase my FICO score slowly just be to continue keeping my utilization under 5%? Is there anything else I might be able to do?
You can ask the CA to remove it. Sometimes they will do this. Its often very easy. Sometimes, it takes work.
It will hurt less as it ages. But yes, paid is much better. It is unlikely that lenders will give you new credit with unpaid collections.