How will a paid delinquent account affect my credit score, and how long will it take?

Question

I checked my credit report for the first time in July 2008, and was surprised to find among all positive marks one very delinquent account for a $100.00 medical bill from October 2004. I was unaware that this account even existed, since I had never been notified that I owed money, neither from the hospital nor from the collections agency. This account had seriously been hurting my credit score!

I called the collections agency to settle the debt. I then paid it off over the phone (I called the hospital to verify that the money was really owed, which it was) and thought that all my worries were over. But then some friends suggested that despite having paid the debt off, my credit report and score would still show negative information. So I called the collections agency back and requested that they remove the negative information that was linked to my name. The man I spoke with said that he had already taken care of that for me when we spoke the first time, and that it should be reflected in my credit in about 60 days.

I was just wondering if I can trust his word (because I don't have it in writing). He was very kind and very understanding, and it seemed like he truly wanted to help me, since I'm what he called "still pretty young" (I'm 22 years old). Can the collections agency simply remove this negative information by request, as I had done? Can credit scores really be improved this way? Will the currently paid account still be shown in my credit report? Or do I need to do that "pay for delete" thing? Thanks very much in advance for your help!

Answer 1

The best way is contacting the credit bureau and they normally removed quicker then the collecting agency.But make sure you have a receipt proving you payed it off.

Answer 2

You have to get the pay for delete agreement in advance of paying.  Too late for that now.  Hopefully, the collector will remove the item and you will be fine.  

If not, derogatory items stay on your credit report for 7-1/2 years from the date of first deficiency.  Paying does not automatically get the item removed.   While this derogatory will hurt your score, it won't be too bad, especially if you have a lot of good tradelines.

Answer 3

The collection agency will not remove the negative record from your credit file. Yo will have to get a "paid in full" letter from them, make three copies of it and send one to each major credit reporting agency.