How is my credit score impacted by paying a charge off?
A collection agency will often offer a settlement for 20-40% of the original balance as a typical agreement; however, a “PFD” (Pay for Deletion) settlement will come at a much higher cost.
Collection agencies will typically demand between 60-100% of the debt to negotiate deletion of an account. This is a major benefit for the collection agency because they have not incurred any additional costs for this type of negotiation.
Finally, under no circumstances should you ever expect that a creditor or collection agency will agree to anything less than 100% payment in full if they know that you are in the process or planning to buy a home. Therefore, prudence suggests that you keep this little tidbit to yourself otherwise you may not like the outcome.