I Don't Understand

[mountainlady]

Do to some family problems i got behind on my accounts and many were turn over to collection agencies. Now I just pulled my experian report and credit score, which was 571. The report said there was 12 "potentially negative" items. This is what I do not understand. Out of the twelve, 6 are related(1 orginal to one collector, with another account to be pd off thru collector not original creditor.

Example Capt one wrote off, but i pd it in full thru a collection agency. both are on the report as negative. i thought if i pay it off it would be a good thing. one cancelling the other out, improving my credit. Can some one explain to me what is going on.

i need to get my credit up as we are getting told to move and we need a mortgage and right now no one will loan to us. Any information or help will be greatly appreciated. i am getting stressed.

Thank you ,

Kami

[NASCAR_Devil]

Do to some family problems i got behind on my accounts and many were turn over to collection agencies. Now I just pulled my experian report and credit score, which was 571. The report said there was 12 "potentially negative" items. This is what I do not understand. Out of the twelve, 6 are related(1 orginal to one collector, with another account to be pd off thru collector not original creditor.

Example Capt one wrote off, but i pd it in full thru a collection agency. both are on the report as negative. i thought if i pay it off it would be a good thing. one cancelling the other out, improving my credit. Can some one explain to me what is going on.

i need to get my credit up as we are getting told to move and we need a mortgage and right now no one will loan to us. Any information or help will be greatly appreciated. i am getting stressed.

Thank you ,

Kami

How are the TL's reported? Does Cap1 show a $0 balance and sold to another lender? Is the CA's TL reported as "paid collection"? That is as bad as an unpaid.

[BTO429]

Before I will pay a CA I always send them a PFD letter(payment for deletion)

Sometimes they will and sometimes they wont.

If they refuse I then try a ND letter(non disclosure) I have had good luck with this.

Never call them get it in writing.

[CleverCynic]

That's the first false assumption people make before doing any research, that paying the debt will do any good. Only do this if you are seeking a mortgage since they will require collections paid, or if you can prevent the debt from appearing on your credit report in the first place. Otherwise as far as improving your credit, you have to dispute the accounts, and if they verify, hopefully they will violate FDCPA that you can get them on as leverage. If you've already paid it, game over and you're stuck with it and the derogatory information, twice.

The OC derog shouldn't hurt as much as the CA derog, since it shows 0 balance and nothing owed.

[Ahntara]

"...pay it off...good thing...improving my credit..."

A common misunderstanding, yes. Fair, no. You did, indeed, improve your 'credit' profile by paying off bad debts. That's always a good thing. Don't let anyone tell you otherwise. But credit reports, credit scores and lending decisions are not made based on this type of assessment.

First and foremost, you are qualified as a borrower by your score. If you need a 620 to get that mortgage loan you crave, a 619 gets you declined, period! (that's only an example) That is one of the reasons we post here, to help consumers understand this strange process and all it's implications.

Once an account goes into default, paying it results in a paid, defaulted account. Very few circumstances take it out of that category. While potential lenders may view your payments as favorable, that will mean nothing if paying resulted in a lower score...you won't make it past that first hurdle.

You've told us your goal, a mortgage loan, but we need additional details to guide you. What else is on your CR? Do you have positive, on-going credit accounts? How soon do you need that mortgage?

Keep your chin up and read up here. You'll find lots of people in the same or worse shape than you and many that have improved their situation immeasurably.