Best Answer

Consistent payments will raise your FICO faster than payoffs. Banks don't like it when you pay off the ballances in full because they are not making any money when you do that. Folks that pay off their credit cards every month are essentially getting a free 30-day float, which does not help their FICO as much as maintaining a balance and making payments on it. The previous answer applies to making payments on a positive, revolving, account like a credit card. It is not a good answer the question posed, namely: Does paying off a collection account or making payments raise your score quicker? Paying off derogatory accounts does nothing to improve your credit score and can, under certain circumstances, lower your score. The reason this happens is that paying off a defaulted account updates the account to NOW. The NOW causes the scoring software to calculate the account as a default that just occurred, instead of something you are trying to "clean up". This hits the score in the History category, which accounts for up to 35% of the total. Once any account goes into default, the entire balance is due and payable in full. If a creditor chooses to take payments, they do so at their own discretion. Payments at this point does nothing to improve the situation, except make the outlay of funds easier to bear. So, neither action improves your score. If you want to raise your credit score, you need to look to other activities.

User Avatar

Wiki User

โˆ™ 2006-02-19 02:25:35
This answer is:
User Avatar

Add your answer:

Earn +20 pts
Q: Does paying off collection balances in full or making consistent payments raise your FICO score quicker?
Write your answer...
Related questions

Why paying bills online is better than mail in payments?

It is quicker, and you can also check the status on the internet. Main reason is quicker, more efficent, also it saves paper.

Is it better to pay original creditor who still owns account or debt collection agency who is collecting for original creditor?

Paying the collection agency will clear up your account much quicker and some creditors will return the payment to you if you send it directly to them. Most creditors sign a contract with a collection agency and cannot discuss the debt with the debtor once they place it with the agency, they must refer all correspondence, communications and payments to the agency for the life of that contract.

Is a lighter weight good for trap shooting?

Yes and no, some like a lighter gun so that they can get the gun gun on the target quicker but i like a heavier one so that my follow through is consistent

If a double principal is paid on a mortgage will it be paid off quicker?

If you plan to stay in the home for a long time extra payments toward the principal can reduce the payback time by years depending on how much you pay.

What are the benefits of refinancing your home?

Refinancing your home may give the advantage of lowering your current mortgage or reducing your monthly mortgage payments allowing you to pay off your existing mortgage quicker than anticipated.

How can one lower your interest rates?

Some tips for lowering interest rates are these: pay the credit cards off in increments. By using payments on time it should lower the bill and interest rates quicker.

How do you spell quicker?

That is the correct spelling of "quicker" (faster).

How could you type quicker?

you can type quicker if you practice more

On Wii job island how do you get the transformawatch quicker?

There is no way to get it quicker

What evaporates quicker water or diesel?

Water evaporates quicker :)

What is a sentence using the quicker?

The word 'quicker' is the comparative form of the adjective 'quick' (quicker, quickest). Example sentence: The quicker bird grabbed the bread crust while the other squawked in protest.

Why does your body have a quicker recovery time after exefcise?

if your recovery time is quicker and your friend then your fitter than him the quicker the recovery time the fitter

How do flowers grow quicker in a green house?

Greenhouse gardening offers warmth, consistent water, fertilized soil which is ideal for the flower, and human supervision. In the greenhouse, there is no pelting rain, pests are managed and the climate can be controlled to the ideal level for the flowers being grown. This idealized climate may afford the flower more protection and less stress, thus resulting in a quicker-growing cycle.

How can you make your period come quicker?

you can not make your period come quicker.

When does diffusion occur quicker?

Diffusion is quicker at high temperatures and pressures.

Is it quicker to fly to the moon than to the sun?

Yes, much quicker.

How can I speed up paying off my student loans?

You can speed up paying off student loans by paying as much as you can every month or whenever. The quicker you pay it off the better. It's never good to delay the payments.

How long after balances been paid down score goes back up?

Depending on how you paid your balance . If you paid a collection agency be sure to get a letter immediately .If you used a check it usually takes 30-45 days after the check clears for them to be able to issue a letter .Credit card payments almost immediate after card is approved .They then have to send to all 3 credit bureaus showing balance is paid .And the credit bureaus can take up to 9 months sometimes to fix these credit reports and scores . Best bet is to get those letters and take it upon yourself to puth the credit bureaus a little quicker . If for some reason you are trying to get a mortgage, loan etc. These letters come in handy showing debts are pd .

Do seeds grow quicker in water or soil?

seeds grow quicker in soil.

What did cotton gin and interchangeable parts accomplish?

quicker fixing and quicker cleaning.

Is it quicker to New York than by bus?

What is quicker to NY than by bus.

What are the benefits of a monogastric digestive system?

they can get energy quicker and the digestion process is quicker

Does Ice melt quicker in salt water?

Yes, but even quicker in hot water.

What can make a salt dissolve quicker?

To make salt dissolve quicker: * Heat it * Stir it

What cools quicker hot air or warm air?

warm air cools quicker