Paying down balances -- affect on score

[matlock99]

Hi there. I recently paid off $10,000 on a Mastercard that was maxed out to its $10,800 limit. The reduced balance hit my report the other day, but no affect on scores yet. My only other significant debt is about $12k in student loans that are split up over five different collection/chargeoff accounts, and those are being paid off today.

My question: about how long should these payments take to affect my score? They will bring my debt-to-credit ratio down from 91% to about 10%. I did the Suze Orman FICO kit and it said that paying down my balances was my best course of action, but the projected jump was over a period of two years (I'm assuming they default to that time frame since it would usually take time to pay down such high balances -- believe me, usually would for me! Just got lucky).

Other than that, my credit report shows two judgements and six other chargeofffs (not counting the ISAC student loans; I'm not sure how the status of those will change once they're paid in full). FICO: EQ 572, TU 594, EX 588

As always, thanks so much for the help!

[Yawo64]

Hi,

Its good to know you are making strident efforts to pay off the debts.

I am also just starting credit repair, and one thing i learned here is if you arranged a sort of pay for delete when you paid the debts, or at least negotiate a more favorable reporting such as "Paid As Agreed"...

This is because, a paid collection or charge-off is just as damaging as unpaid one.

It does take some time for improvements to hit the credit reports...hence you might want to keep on checking for changes on the report.

rgds and best of luck - Y

[someonesomewhere]

If you sign up for a 30 day free trial to MyFico ScoreWatch, you can use their FICO Score Simulator to see what effect various actions will have.

On your CO and COLL accounts, did you negotiate a PFD? If not, you're going to have a paid collection, and you're not going to see much improvement in your scores.