“Settle Collection Accounts or Pay them in Full?”

“Settle Collection Accounts or Pay them in Full?”



Good morning Joe.

I wanted to make sure that you received my packet. I began paying off debt. You used the term settle in your past email.  Does settling the debt have the same positive effect on my credit, verses paying each debt off completely? Obviously my money will go a lot further if I can just settle.

Thanks Liz



There are many important reasons to get collection accounts resolved that show up on a credit report.


Most collection companies report the negative information to the credit bureaus each and every month which lowers credit scores. The quicker the debts are resolved the sooner scores will start to improve.


Resolving collections can be done a few different ways. Paying them in full, getting the creditor to accept less than full payment or setting up a monthly payment until the debt is paid off.


Understand that if a monthly payment is set up, the creditor will not notify the credit bureaus until the debt is paid off and will continue reporting the debt negatively until paid.


One more consideration is that some creditors will agree to take the debt off the credit reports all together if the obligation is paid in full but that won’t be done unless you ask and that is part of the negotiation.


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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

110 Main St.

Manchester, Ct. 06042

Office: 860 647-7701 x116

Fax: 860 647-8940

Cell: 860 836-9294

Email: joe@righttracfg.com



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Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.

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Comment balloon 3 commentsJoe Petrowsky • March 07 2019 02:04PM


Very useful information for those who need to improve their credit scores.

Posted by Kat Palmiotti, The House Kat (406-270-3667, kat@thehousekat.com, Broker, Blackstone Realty Group - brokered by eXp Realty) about 1 year ago

Good morning Joe. Your advice is priceless with those trying to resolve problems. Enjoy your day!

Posted by Wayne Martin, Real Estate Broker - Retired (Wayne M Martin) about 1 year ago

Morning Joe.

Sage advice from someone who helps people have the American dream.

Posted by James Dray, Exceptional Agents, Outstanding Results (Fathom Realty) about 1 year ago