What to pay off first?

Hi

Have these collectors hit your credit file? If not, you can avoid dealing with them. If you make a payment to them, they will report in your credit and this will hurt your scores.

Try to work out arrangements with the original company. They will accept payments from you and update your file with the bureaus. Propose your payment plans and they will work out arrangements with you. I will suggest staying away from the collectors as far as possible.

As for how to pay off larger debts, pay what you can to each of them, when the smallest one is paid off, apply that payment to the next smallest debt you have, this way your focus fire payment will gang up and sooner than you think you'll be out of that ugly debt.

I would say pay the child support off first. I would think that would really look bad on a credit report. Plus it would be great for the kid(s).

Dear Guest,
My children live with me, the debt is from several yrs ago.
So to me it sounds more sensible to pay off the other debts first thus eliminating some interest (no interest on the child support),and other possible charges.

Thanks for the help, I have started with the smallest debt as suggested.

I might add for "Guest's" benefit I paid off over 5000. of that child support last year, and plan to finish it off next tax season, the children will never see a penny, Mommy done already smoked it up!

Take care...John

You sound like a good guy, but I would also think that the back child support would look bad on a credit report. There would be no way for someone checking your credit to know what your circumstances are or that the children live with you. Do you know if the child support will stay on your credit report for 7 years or once it's paid will it be removed?

[quote name="Kathryn"]You sound like a good guy, but I would also think that the back child support would look bad on a credit report.[/quote]

Thanks Kathryn,
By today's standards I am a great guy, I managed to raise the deficit less than 400 Billion $'s ;)

I read somewhere in my latest credit report where the child support was referred to as a 138 month old installment account and was current.
I imagine once it is paid it will linger for seven yrs, as I have been paying monthly payments for over 8 yrs, however I am not sure if this will/could be a positive attribute later.

Fact is I don't have the financial resources to just pay this off now, or I would have long ago.

The monthly rate was 1200.00, and at the time I was only earning 2000. per month if I was lucky,
fortunately after several yrs of this the State Attorney General stepped up and was able to reduce the payments (no effect on the debt),so I was then able to crawl out of the hole (able to keep a job, able to support family and have gas to drive to job,etc...).
I could write a book, but not here ;)

I filled out my W-4 as single with no dependants this yr, I will be paying the off the remainder of the child support with my tax/EIC rebate.

I'm sure there are better answers, I could probably be drawing interest on this money, BUT I have a hard time budgeting my (our) money and thought this would be the sure way of dealing with it (government gets the interest).

At the present time I am paying down my credit cards (approx 1400.) from a friends advice (reduce balances to 25% of available credit).

Per "phonguy" advice, I am paying the smallest debts first, and thank you for that advice!

"GunsNroses" These are old debts (6+ yrs) both on my credit report, the largest being a 629. from AT&T to which I was charged long distance on a phone with a contract including free long distance (I was a long haul trucker for 16 yrs), after arguing with them a few times I canceled all 3 phones and went with Verizon (much better company), this debt was sold to a collection agency.

I have been receiving letters from this collection agency offering settlement prices, but I'm afraid if I "settle" it will have more of a negative effect on my credit record.
I plan to save up the money and pay in full, if anyone has any more advice it would be appreciated.
Thanks...John

Some creditors will report a settlement as "paid as agreed" if you request it, but not all. Surely a paid off account, even if settled would be better than an account in collections. The quicker an account is paid off, even if settled, the quicker it will roll off your credit report. Be sure to get documentation of your settlement agreement. I have had a company sell the balance they call charged off to a debt buyer after they agreed to a settlement amount that I paid in full. Good Luck!!