A collection case will almost certainly damage a consumer’s credit score, which is why so many people attempt to avoid collections at all costs. The goal is to settle the matter as soon as possible to fix the damage done. But paying off an account in collections does not necessarily mean that the consumer’s credit score will immediately improve.
A collection account shows up as an entry on a consumer’s credit report. Essentially, the collection shows anyone who checks a consumer’s credit report before offering any type of lending that the consumer defaulted on a previous liability. Many times, a collection account will start once the original creditor sells the debt to a third-party debt collection agency or to a debt buyer.