Pay collections debt

[112]

I don't know which forum to post this question in, so I thought this would be the closest one. I have a debt that went to collections a few years ago that I don't remember having/I forgot about. How would I go about paying off this debt? I got a credit report from Experian and it listed a debt that went to collections. I went on Experian's page but there's no email I can contact them at. Is there a different way I can go about this? Thank you.

 

[MercenaryForHire]

1) Contact company that debt originated with
2) Ask for name of collections agency
3) Pay them
4) ...
5) No profit!

- M4H

 

[royaldank]

If you are applying for credit at the moment (home loan, car loan, etc.) you might want to wait to pay that off. It will hurt your score more (for a short period of time) after you pay it off than it is hurting it now.

 

[EagleKeeper]

Originally posted by: MercenaryForHire
1) Contact company that debt originated with
2) Ask for name of collections agency
3) Pay them
4) ...
5) No profit!

- M4H

Most collection agencies have purchase the debt for well below face value.

Attempt to negotiate a reduction in what you owe (if you are able to pay all up front) to the original company.

If they pass you onto some-one else, repeat the process.

If you are given more than a 20-25% reduction in debt, the total reduction is reported to the IRS as income.

 

[sandmanwake]

How long ago is a few years ago? You could be doing yourself more harm than good if you pay it off now. It should drop off your record in 7 years, but if you pay it, the clock resets.

That said, it's good that you're willing pay the debt you owe, but make certain that the party you pay still hold your debt and that you get some sort of written proof that you've paid it off.

Also, since you don't remember it, are you sure it's yours and someone else's debt didn't get put on your record by mistake or it's a fradulant account? It happens.

 

[FoBoT]

be real careful , you might end up paying the debt more than once. go back to the original company that you owe the money to and get info from them

 

[Christoph]

If you don't remember having the debt, how can you be sure the debt is actually yours or that the balance is correct? Request validation from the collection agency before you do anything else.

If you do end up paying them, try and negotiate a pay-for-delete, so they delete the entry from your credit reports in exchange for the payment. As others have mentioned, a paid collection will probably hurt your credit score because it makes the account appear newer.

Read the forums at artofcredit.com or creditboards.com for more info. Creditboards in particular has a good newbie forum.

 

[Mill]

Go here and post before PAYING ANYTHING. If you are going to pay -- pay to settle with a deletion so your credit isn't marred.

 

[MidasKnight]

Originally posted by: EagleKeeper

Originally posted by: MercenaryForHire
1) Contact company that debt originated with
2) Ask for name of collections agency
3) Pay them
4) ...
5) No profit!

- M4H

Most collection agencies have purchase the debt for well below face value.

Attempt to negotiate a reduction in what you owe (if you are able to pay all up front) to the original company.

If they pass you onto some-one else, repeat the process.

If you are given more than a 20-25% reduction in debt, the total reduction is reported to the IRS as income.

Wow. Great info there. Thanks