Paid Collection Still Appearing |
Get Off My Report!
By Chris Buchheit on July 14, 2010
.jpg.aspx) Owing collection agencies money is a quick way for your credit score to tank. However, once you manage to get your debts paid off, the collection agencies might still report the debt on your credit score, which will stick out like a sore thumb for banks and creditors. Apparently, the creditors have a right to continue to report this debt, even if it has been paid.
Be sure to take care of these debts as quickly as you can. Not only will it save you a lot of money, but it will decrease the chances of the debt badly affecting your credit. The longer you take to pay off the debts, the longer they will obviously appear on your credit score. Once they have been paid off, you may have to do some negotiating with the collection agency to get the debt taken off of your credit score. According to Mel Jensen, the best thing for you to do once you get your debts paid off is to make sure your creditor reports the debt as “paid in full”. This report will help bounce back your credit score. However, the creditors might not bend as easily. If you can manage, you might be able to get the creditors to take the debt off of the credit report altogether, but this will not be likely to occur.
Jensen believes as I do, that it is best to resolve your debts and handle your finances so they do not need to go to collections, but if they do go there, take care of your debts quickly, otherwise you will be in for a longer hassle than you wanted to bargain for.
The good news is that once you do pay off these debts, your credit score will marginally improve, and if you show continued signs of fiscal responsibility, the score will likewise continue to improve. However, the collection account will likely remain on the credit report for up to seven years, but as long as it appears as “paid in full” or “deleted”, your credit score will not necessarily be detracted, but it would not improve as well as it would without the record. This example should provide enough reason as to why you should keep your finances in order – and out of collections.
Note: Once your account goes to collections, you should avoid applying for new credit for the next couple of years. It will take some time for the effects of the collection account to wear off.
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