need help : difference between paid in full and settled in full

[kit600ana]

i am in the process of paying off several debts i have.

 

i would like help understanding what the difference is between the two terms paying a debt in full ( the full fee stated by the collector ) and settling in full ( for less then the amount they want ) more specifically : once the debt is paid off and they report this to the original creditor, and they in turn report to the credit reporting agencies.... how is this debt payment viewed and recorded on my credit history? how much worse is just paying the settlement vs. paying off the full amount? is there much difference at all?

 

thank you much in advance for any help.

[radi8]

Settled in full is somewhat more negative as it indicates you didn't repay the full balance. If it's tied to an account that is reporting chargeoff, it's a minor consideration as the CO is the larger negative.

 

Ideally you'll get the collector to remove their reporting entirely as part of your settlement.

[kit600ana]

Settled in full is somewhat more negative as it indicates you didn't repay the full balance. If it's tied to an account that is reporting chargeoff, it's a minor consideration as the CO is the larger negative.

 

Ideally you'll get the collector to remove their reporting entirely as part of your settlement.

 

i obviously have already done damage by getting the CO in the first place. the main goal is to stop the delinquent reporting and get rid of the debt. in the overall picture will it do any more significant " damage" to get the settled in full vs paying off the whole balance.... will it be seen later on as well hey he paid it off and thats whats important?

[radi8]

Settled in full is somewhat more negative as it indicates you didn't repay the full balance. If it's tied to an account that is reporting chargeoff, it's a minor consideration as the CO is the larger negative.

 

Ideally you'll get the collector to remove their reporting entirely as part of your settlement.

 

i obviously have already done damage by getting the CO in the first place. the main goal is to stop the delinquent reporting and get rid of the debt. in the overall picture will it do any more significant " damage" to get the settled in full vs paying off the whole balance.... will it be seen later on as well hey he paid it off and thats whats important?

 

Like I said, "settled" is somewhat more negative than paid in full, because you didn't "pay it off"- you only paid PART of it off.

FICO doesn't make a big distinction from what I gather, but sometimes individual creditors do.