Questions?

Hi James,

I’d be happy to answer your question. As far as credit scores are concerned, a collection account is as negative as it gets, short of bankruptcy. The status of the collection account, whether it’s unpaid, paid or settled, will have little importance. What’s important initially is that you didn’t pay the original account as agreed. That will have a very serious effect on your ability to get credit.

When you settle a debt, you repay less than agreed under the original contract, which still shows you didn’t meet the terms of the contract. Therefore, a settled account is less positive than a paid account, which shows you repaid the total amount in full. This information is relevant in reference to credit scores, not necessarily as to how lenders view the situation.

If you can come to an agreement with the collection agency to “settle” the debt in full for a lesser amount, see if you can negotiate the deal to have them remove the collection account from your credit report completely after the account has been paid. If you can pay the negotiated amount in full, you have more leverage to ask the collection agency to do this.

One word of caution, whatever negotiation you come up with, GET IT IN WRITING BEFORE YOU PAY A DIME! This way you have documentation to fall back on in case they don’t hold up to their end of the bargain.

Hope this helps and if there is anything else I can answer for you, feel free to ask!

Warmest Regards,
Taylor

Hi Ben,

I’m not sure which letters you’re referring to when you say “DV”, and I’m also not sure who you sent them to, but it sounds as though you sent them certified mail, which is good. You’re also saying that you got back a letter from Equifax saying the account is currently not reporting on Equifax credit file. Whatever it is, if it’s not reporting on their file, that means it’s not showing up on your credit report. Based on your question of “Can I get this removed?”, it sounds like it already has been. If I’m not understanding you correctly, please feel free to elaborate further and I’ll be happy to clarify anything else.

By the way, good job in working on your credit yourself. It sounds as though you accomplished what you set out to do!