Credit score?

I have just paid off all my credit cards ( about $3,000) .They all have zero balances now.Also I paid off something that I had monthly payments on , which I paid off early the balance was $1,200 .How much can I expect my credit score to go up with these changes? Also when i pulled my credit report there was a new collection on there , that just came on there 10 days ago . But is for a really old bill that I didnt know I had , the collection is $26 .Should I dispute it as I was never informed of the debt , therefore i was not given the opportunity to pay before it went to collections. If I dispute it how much points can I expect to lose on my credit score? I am trying to get preapproved for a mortgage , so trying to up my score for a better rate . This debt is over six years old , i have contacted the original creditor and they have no info regarding the account . All they have is the account number and my name . It is for an old telephone bill , when we moved we could not connect our new phone untill we settled all charges with the old phone .We paid all of the existing charges and now 6 years later they have sent us to collections for $26 we didnt know we owed them .

Public Comments

1. If your credit score is very important to you, pay the $26 - it's too small of an amount to screw up your credit over. But I don't think disputing it changes your credit score. Pulling your credit report too much makes your credit score go down, I don't know why, but limit the number of times you pull it or have any company pull it. I
2. The credit score just isn't that important. For more info on that go to www.daveramsey.com Dave Ramsey teaches people to win with money. If I owed it the 26 dollars I would pay it. But, I would ask them to mail me in writing that this takes care of the debt in full. I have paid a bill for my grandfather who had passed away. I requested the total amount and paid what they told me it was. Then, they send me another bill for double that!
3. Well, it sounds like you knew it was a collection they just re-reported it. You need to zero out all your collections as well. For $26, pay it off - but get EVERYTHING in writing from ANY AND ALL collections agencies. That NEW report or trade line on your credit report is a derogatory trade line and will greatly impact your credit. Having zero balance is good, but keep the credit cards open, even if you only buy a stick of gum every 3 months. You need to show you manage credit well to have a good credit score. Disputing, if it works, should IMPROVE your credit score by removing that trade line. If it is a legitimate claim, it won't impact it at all. Again, for $26 - just get it paid off - via cashiers check - never give them access to your bank accounts and get it in writing that this satisfies all their claims, etc, etc. Best of luck. Joe...
4. I mean u can try and dispute that one or just pay if off and your score will jump but i could not tell u how much.. You should wait 6 month to try to get a house, that will give score time to go up.. and good luck
5. you can never been sure of how many points you will recover/lose on your FICO based on a particular debt. various debts report to different bureaus. I can give you a few pointers that will help you along the way: 1. do not close those credit cards, keep them open... used one or two of them once a month and pay it off right away to show an active, good standing credit 2. dispute that collection. if it is over 3 years old, a lot of times the record of that particular debt has been lost during its transition. 3. contact all three of the bureaus and make sure your collection is eliminated from each one. The collection company will not dispute this item for you... do not depend on them to do so. I hope this helped.
6. The collections I would dispute. It's hard to say how much your score will increase with out actually looking at your credit report. Paying off your credit cards is good unless you closed the accounts. There is a lot of weight on a score about length of time you have had an account with such and such credit card. Here are the weight factors in a score determination: 1-Payment history 35% 2-Amounts Owed 30% 3-Length of Credit History 15% 4-Types of Credit Used 10% 5-Inquiries 10% Hope that helps!
7. Paying off your credit cards really has little to do with your credit score. UNLESS you were maxxed out on your cards. People assume simply having less debt means having a better score. Not true at all, in fact often its the exact opposite. Keeping your cards at 50% or less of their limit, paying all bills on time, and not letting things ever go to collection, and long standing relationships with credit accounts is what helps your score over time.
8. it really shouldn't be a problem, we had a couple really old bills that we knew nothing of and it didn't hurt our application. However, if you are really concerned, pay the bill and have the collection agency mark it as paid in full. A good payment history of two years, low debt to income ratio, and funds on hand will help you get your mortgage.
9. pay the $26 bill to the collection agency-- however, this will effect the rate of interest u may qualify for for he mortgage...get a credit report at least 1x a year so u can always be aware of what is on your report...so many people don't know anything until applying for a mortgage and then it is too late cause these things take time to fix... www.annualcreditreport.com and get a free copy of your credit report