Should you settle small account balances? 

Paying or settling a collection account on your credit reports should not breathe additional life into the 7 year negative credit reporting limits. If that account is paid or unpaid it still comes off at the same time. Paid tax liens are one of the few exceptions.

You're welcome. Any time.

I would try to settle for less if it were me. When you call Synchrony you may find they have sent your account to another collection company. That is normal, and you can still negotiate your settlement with that other company.

There is sometimes a concern for paying really old collection accounts that are considered negative, but stale after a couple years of just sitting there. Settling brings a "freshness" to the stale negatives, even though you are doing a good thing, and I have seen that drops some (not all) scores temporarily. Overall you did a good thing for your score if the negatives were going to be on there for a while longer, and a necessary thing if you were to try to get a mortgage or refinance one.

There are several good videos with tips for negotiating on this channel, like this one: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-xWV644gSiCQ.html

Thank You

What was this debt about? Who is the collection company? Was this same collection company on your credit before, but no longer? Was there a different collector reporting it on your credit than this one? When did you originally stop paying this?

@@MichaelBovee Good after noon sorry I'm just responding late. So it medical bill. Phoenix Financial service, yes same 3rd party collection that was in my credit but the creditor is Questcare medical svcs pllc date 5/18/2018.. don't remember making any payments to this company🤔 could possibly be something that was left over after my insurance paid off I'm really not for sure hope this helps and thank you again

If it is not on there now, and appeared after you paid the settlement offer, it should only show up again as a paid collection. I am not sure it would go back on their as paid if they took it off already when it was unpaid.

@@MichaelBovee Okay... So is it okay to have a paid debt on your credit report? If they do decide to report it🤔 will that be in favor of my credit report... my credit report is a 719 right now... thank you again for your response...

We would prefer it not be on there at all, but if it goes on there again somehow, it would have to show a zero balance owed if they agreed to resolve it with you. A paid collection looks better than an unpaid one for sure! And you can still accomplish major credit and finance goals with a paid collection on your credit.

Settling can drop a credit score for a month or 2 in some situations, but improves access to credit immediately (if all debts are settled). The score can then often improve faster, and increase higher, from there.

@@MichaelBovee hmm okay does it matter if the accounts have been in collections for 2-3 years? Thank you for replying btw

Just that the accounts are a little stale and would represent what I have often seen where a score drops temporarily like mentioned. It is important to point out that resolving all collections moves you forward. I see instances where someone takes care of 2 out of 3 unpaid collections, but not the third, and that could hinder the desired outcome.

​@@MichaelBovee I figured that was the case however, there's just so many "what-ifs" that I don't know the best way to go about this. I have the income and saving (for now) to probably pay everything off at once, but it would wipe out my savings. I work 2 jobs and close to 80 hours a week so I don't want to end up wasting it. I just want to make sure I wouldn't be throwing money away at this point bc I did that already a few years ago. I wasted $2,000 in one month trying to keep my credit in good standing. Long story short I lost my job and found one after several months and moved across country. I couldn't afford to make any payments until recently but now i'm wondering if it's even worth it? All of my other debts are over 2 years in collections at this point So what if I get a secured credit card? or just went ahead and accept a high interest car loan or something similar, that's still well within my budget? Would it matter that I made consistent payments on a much newer credit line?

Go ahead and schedule a call with me here: calendly.com/debtbytes/15min I will go over your list of creditors and collectors, and ask about your near term goals, and see if just holding tight does not make the most sense. This is not a great time to be without an emergency fund.

Ideally you want the letter before you pay. In the alternative, if it were me, I would record the phone call with them (telling them I am) where we go over the details of the agreement. Did they indicate to you they would send you the agreement? I would take a moment to write down all the details of the calls you had. The dates and times of the calls looking them up on your cell phone. The numbers you called, or that called you. The names of people you spoke with. Basically recreate everything in a summary. Their calls are typically recorded. Identifying all this detail while it is fresh in your memory will make it harder for them to say they cannot locate the details of your interactions if they have to respond to a regulatory complaint or an attorney. I know you do not want it to come to that, but it is ideal to be prepared in these situations. I can tell you from other experiences that Wakefield should not be trusted.

Are the student loans federal or private? Who are the creditors/collection agencies on the other accounts? What are the balances owed today? When did you stop paying on the accounts?

If you are sure to pay them off before the credit reporting cycle hits for each card, I would not expect a problem. Without the payment posting before the credit bureaus get updated, you could see some roller coaster months for your credit scores when it looks like you maxed out your cards.