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Hi there!
I am new to this.
I have a small school loan that was handed over to a credit collections agency. As far as my credit history is concerned, is it better for me to set up a payment plan with the collections agency, or should I try to pay off their requested amount immediately.
If I were to pay off the amount completely, may I pay with a credit card? But if it helps my credit history, I would rather have the debt on my credit card as opposed to having the collections agency holding it while I make payments.
Thank you!
paying off school loan
Hi Joseph,
If you have the ability to pay off the loan immediately you can do that. Before you can start making the payments, request the collection agency to agree to a "Pay for delete" (PFD) agreement. With a PFD, all the negatives on your account will get removed. However, not all collection agencies agree to a PFD. You will get a sample PFD letter with this community.
Other than this get the payment agreement in writing, and request the collection agency to report this item as "Paid in full" on your credit report.
Rather than making the payments with the credit card, it is safe to forward the payment through certified mail, requesting a return receipt. This will let you retain the proof of your payment.
Thanks,
Aaron
Have you sent a DV letter to the collection agency?
this will give you some time to negotiate the PFD. there are student loan rehabilitation programs too