Are payments a good idea?

[bobcat.karen]

After trying to search through the posts for answers, I could find nothing that fits my situation. So I'm asking for help...I really need it.

All of my cc's except one are in collections. I am currently dealing with MRS Associates (Capital One), ACB American (Macy's), and Portfolio Recovery (HSBC). Between the three, I owe a little over a thousand dollars. (I know; not a lot, but for a college student who is currently out of a job it's high)

I haven't been with these agencies for long; it's been since August/September, so I am definitely past the 30 day mark. I have been making some payments to these companies in attempt to settle the debt, because it makes me feel a little bit better..I hate having this resting on my shoulders. Should I keep making payments? Since I am young (21) I don't want this to hurt me for ever, and now (since reading this forum) I would like for these 3 accounts to be PFD. Any advice/suggestions/expertise is welcome and appreciated!

Thanks for any and all help in advance

[kevin3344]

I have been making some payments to these companies in attempt to settle the debt, because it makes me feel a little bit better..I hate having this resting on my shoulders.

Personally I wouldn't make payments, I would offer a lump sum and be done with it. However, if that is all you can afford at a minimum you need to get it in writing that X payments for X months satisfies the debt.

[brokeinok]

and you need to get it in writing how they will be reporting it to the CRA's during payment and also once it is paid in full.

[Methuss]

Once a debt collector gets a taste of your money they keep dipping for more and more. Usually for more that you originally owed. Portfolio and MRS are both known for this...they count on you loosing track of how much you have paid so they can keep taking payments. Lump sum settlements are better. These two in particular also regularly refuse PFD because they are large enough that they can absorb such issues. NEVER let a collector direct debit your bank account. I can't emphasize this enough.

As for "following you forever," as you read up in the forums here, you will see that doesn't happen. As a matter of record, a paid collection can only be reported against you for 7 years after the date the account went delinquent. It looks like you about 9 months into that time period. But don't let that get you down. A paid collection has almost no effect on your credit rating after two years.

So your real problem is in making sure these slime-balls don't try to collect more from you than you owe. I suggest a credit counselor. I don't make that recommendation often. But in this case, the amounts are small enough that you are not going to be ruined if the counselor makes a mistake. But you will have a third party recording the details of your payments and the agreement of how much will be paid. They may even be able to get your desired PFD if they are good at what they do. So check into it.