lostjake wrote:I wouldn't pay the full amont to the collections people. If you owe 200 offer them half, they'll probably take it. Don't tell them what situation you're in or they'll bend you over.
This could actually backfire. If they take a settlement for $100 they can still record the other $100 as a "charge-off" on the credit report, which sucks too.
My advice is to simply pay it off and request a proof of payment letter. Provide that to the student loan "folks" and you should be fine. Either they will reconsider your current application or make you re-apply after the collection agency clears the payment. The collection agency is supposed to report the payment to the credit bureaus but it can take between 30 and 90 days for the bureaus to begin reporting it. FWIW, I work in lending and underwriting.