Can I pay the company instead of the collection agency?

Asked by: Titus O'Connell  |  Last update: September 14, 2022
Score: 4.4/5 (62 votes)

Unfortunately, you're still obligated to pay a debt even if the original creditor sells it to a collection agency. As long as you legally consented to repay your loan in the first place, it doesn't matter who owns it. You may be able to pay less than you actually owe, though.

Can I pay my original creditor instead of collection agency?

Working with the original creditor, rather than dealing with debt collectors, can be beneficial. Often, the original creditor will offer a more reasonable payment option, reduce the balance on your original loan or even stop interest from accruing on the loan balance altogether.

Is it better to pay the collection agency or the company?

In most cases, the original creditor will give you more generous terms for repayment than any debt collector will. The original creditor will also be happy to recoup the debt that they extended to you, at least most of the time. Paying the original creditor can also help your credit score in many cases.

What happens if I pay the creditor and not the collection agency?

The original creditor could keep the money you owe and not inform the collection agency of anything. That will result in a collection agency trying to collect the money for a bill you already paid. The collection agency can legally report this debt to the credit bureaus.

How can I avoid paying a collection agency?

Summary: When a collector contacts you, respond with a debt validation letter. You may not want to pay a collector if you will never have any income or assets, if you don't owe the debt, if you want to settle for less, if the statute of limitations has expired, or if the collector doesn't own the debt.

Do NOT Pay Collections Agencies | Debt Collectors EXPOSED

39 related questions found

Can paying off collections raise your credit score?

Unfortunately, your credit score won't increase if you pay off a collection account because the item won't be taken off your credit report. It will show up as “paid” instead of “unpaid,” which might positively influence a lender's opinion.

What is the lowest a debt collector will settle for?

When you're negotiating with a creditor, try to settle your debt for 50% or less, which is a realistic goal based on creditors' history with debt settlement. If you owe $3,000, shoot for a settlement of up to $1,500.

Can you pay a bill once it's been sent to collections?

Even if a debt has passed into collections, you may still be able to pay your original creditor instead of the agency. Contact the creditor's customer service department. You may be able to explain your situation and negotiate a payment plan.

Can debt collectors refuse payment plan?

Can a Debt Collector Refuse a Payment Plan? It's important to know that collection agencies aren't legally obligated to accept or agree to payment plans. Debt collectors don't have to work with you or agree to any payment schedules based on what you're reasonably able to afford.

What is the 11 word phrase to stop debt collectors?

If you need to take a break, you can use this 11 word phrase to stop debt collectors: “Please cease and desist all calls and contact with me, immediately.” Here is what you should do if you are being contacted by a debt collector.

Do collections go away after paying?

Any collection entries related to the same original debt will disappear from your credit report seven years from the date of the first missed payment that led up to the charge-off.

How long after paying collections will credit score improve?

Any credit score improvements that may occur after you've paid off a collection account will appear when your credit report is updated, usually after 30–45 days. A few benefits of paying off collections include paying less in interest, increasing your likelihood of securing new loans, and avoiding lawsuits.

How do I get a collection removed?

You can ask the current creditor — either the original creditor or a debt collector — for what's called a “goodwill deletion.” Write the collector a letter explaining your circumstances and why you would like the debt removed, such as if you're about to apply for a mortgage.

What debt collectors Cannot do?

A debt collector is not allowed to:

Use force or threaten to use force against you or your family. Physically threaten you or your family. Give, or threaten to give, information to the consumer's employer that may affect their opportunities as an employee. Serve any false legal documents.

What should you not say to debt collectors?

9 Things You Should (And Shouldn't) Say to a Debt Collector
  • Do — Ask to see the collector's credentials. ...
  • Don't — Volunteer information. ...
  • Do — Make a preemptive offer. ...
  • Don't — Make your bank account accessible. ...
  • Maybe — Ask for a payment-for-deletion deal. ...
  • Do — Explain your predicament. ...
  • Don't — Provide ammunition.

Can I negotiate my collections?

Occasionally, when a debt goes to collections you may be able to negotiate with the collector to accept a smaller amount than what you originally owed. An agent may decide it's worthwhile to accept partial payment now rather than go through a prolonged collection process.

What happens when you pay a bill that went to collections?

In general, collections will remain on your credit reports for seven years from the point the account originally became delinquent. The exception is medical bills that go into collections but are later paid by an insurer; those drop off your credit reports upon being paid.

How do I pay off something in collections?

Make your payment

Once you and the debt collector have reached a written agreement for paying off the debt, you'll make your payment. The most secure way to make a payment to a debt collection agency is by sending a check through the mail with a return receipt.

What percentage should I offer to settle a debt?

Offer a specific dollar amount that is roughly 30% of your outstanding account balance. The lender will probably counter with a higher percentage or dollar amount. If anything above 50% is suggested, consider trying to settle with a different creditor or simply put the money in savings to help pay future monthly bills.

What percentage will a collection agency settle for?

Some want 75%–80% of what you owe. Others will take 50%, while others might settle for one-third or less. Proposing a lump-sum settlement is generally the best option—and the one most collectors will readily agree to—if you can afford it.

Will Debt collectors settle for 30%?

Lenders typically agree to a debt settlement of between 30% and 80%. Several factors may influence this amount, such as the debt holder's financial situation and available cash on hand.

Can I have a 700 score with collections?

Yes, it is possible to have a credit score of at least 700 with a collections remark on your credit report, however it is not a common situation. It depends on several contributing factors such as: differences in the scoring models being used.

Should I pay off a 2 year old collection?

If you have a collection account that's less than seven years old, you should still pay it off if it's within the statute of limitations. First, a creditor can bring legal action against you, including garnishing your salary or your bank account, at least until the statute of limitations expires.

Should I pay collections in full?

Paying your debts in full is always the best way to go if you have the money. The debts won't just go away, and collectors can be very persistent trying to collect those debts. Before you make any payments, you need to verify that your debts and debt collectors are legitimate.

How do I ask for goodwill deletion?

If your misstep happened because of unfortunate circumstances like a personal emergency or a technical error, try writing a goodwill letter to ask the creditor to consider removing it. The creditor or collection agency may ask the credit bureaus to remove the negative mark.