Before you pay anything, read this. Validation rights, the difference between paid and deleted, and why the newest collections do the most damage.
A new collection can knock a healthy score down dramatically, and the instinct is to pay it immediately to make it go away. Slow down. Paying a collection doesn't remove it — and depending on the scoring model, a paid collection can hurt almost as much as an unpaid one.
First: make them prove it
Under the Fair Debt Collection Practices Act, you can request validation of the debt in writing within 30 days of first contact. The collector must show that the debt is real, the amount is right, and they have the authority to collect it. A surprising number can't.
Check the details
- Is the original creditor listed correctly?
- Is the amount the same on all three bureaus?
- Is the date of first delinquency accurate? (This controls when it falls off.)
- Is it past the statute of limitations in your state?
- Is it reported twice — once by the original creditor and once by the collector?
Paid vs. deleted
If the debt is legitimate and you decide to settle, negotiate for deletion in exchange for payment, and get it in writing before you send money. A deleted collection is gone. A paid collection stays for up to seven years.
Medical collections are different
Paid medical collections no longer appear on reports from the three major bureaus, and medical collections under $500 are excluded. If you see one, it may be reporting in error.
Collections are one of the most frequently mis-reported items we see. Before you pay, find out whether it's accurate — and whether it can be removed.
This article is general information, not legal or financial advice. Results vary by credit profile.
