Should i pay the collection if passed 2 years

by Sam
(Arlington, Virginia)

I have a collection account that has been longer than 2 years and i was wondering if i settle for less tha what they are asking for, is it good for my credit. Also i was told that paying for less than what is owe is bad.

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Mar 17, 2010
settling collection account
by: Gerri

Thanks for submitting your debt collection question on our Q&A page.

I am not sure what you've heard about two years, but it probably is not a significant factor here. Since it's already in collections, it doesn't matter if you pay it in full or settle it. Neither will improve your credit scores. So if you can't pay the full amount, then try to work out a settlement. If you can pay the full amount, and you owe the debt, then go ahead and pay it off and put it behind you.

Keep in mind that if the collector forgives $600 or more it must send you a 1099 and you'll need to talk with a tax professional to find out whether you'll have to pay taxes on the forgiven amount.

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