Does it affect your credit if you are sent to collections?

Question

Does it affect your credit if you are sent to collections?

Answer 1

YES!!!  It will affect your credit rating as well as your FICO score so contact the lender and try to make a payment arrangement as soon as possible.  If you pay it off, ask them to have the corrections notice removed from your credit score.  Don't avoid them or not return their calls - it will make them not willing to work with you for perhaps settling on a lump sum payment much less than the amount you actually owe.  Contact them and be up-front and honest about what you're able to do and stick to it.  If they agree to settle for less than the actual amount, get the agreement IN WRITING before you pay it.

Good luck!

Answer 2

Yes, it is very bad for your credit.

Answer 3

yes

Answer 4

Yes.  If your account is sent to collections, it means you are already past due on payments and most likely, the past due amounts and lateness are being reported to the credit bureaus.  This will lower your credit score and make it more difficult to get new credit (such as car loans, mortgages, etc.), or result in higher interest rates when you can qualify.

Answer 5

Yup...it means you're seriously defaulted on the account with the original creditor so now they're paying someone to collect from you. Contact the collection agency, make arrangments to pay and get  a 'pay for delete' agreement in writing.

Keep your accounts paid and up to date your credit will improve.