Pay for delete is when a debt collector removes a collection account from your credit reports in exchange for payment.
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“Pay for delete” is a practice in which a debt collector erases a collection account off your credit reports in exchange for a payment on the account. Credit reports provide the data that goes into your credit scores, so having negative information such as a debt collection could harm your ability to get new credit.
However, success is not guaranteed, and the latest credit scoring models are beginning to make pay for delete irrelevant.
Pay for delete is a controversial tactic used by some consumers to try to improve their credit scores. The basic idea is that you offer to pay off a debt that has gone to collections in exchange for the collection agency removing any record of that debt from your credit report. This can seem appealing, since having a debt in collections drags down your credit score. But is pay for delete actually legal? What are the potential pros and cons? And are there better alternatives you should consider first? This article will examine those questions in detail.
What Is Pay For Delete?
When an unpaid debt gets turned over to collections, it shows up as a negative mark on your credit reports. Pay for delete offers a way to potentially remove that harmful collection account.
Here’s how it works
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You contact the collection agency and offer to pay off the debt in exchange for them deleting it from your credit reports with Equifax, Experian and TransUnion.
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If the agency agrees, you pay the agreed upon amount.
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The collection agency will then ask the credit bureaus to take the account off of your credit report.
This can seem like a quick fix to raise your credit score by erasing a damaging debt collection. But it also raises some legal and ethical questions.
Is Pay For Delete Legal?
Pay for delete exists in a legal gray area. The Fair Credit Reporting Act (FCRA) requires that credit reporting agencies like Equifax and collection agencies provide accurate information. Removing a paid collection could be seen as violating the spirit of accurate credit reporting.
However, the FCRA doesn’t specifically prohibit pay for delete agreements. Collection agencies aren’t required to report debts to the credit bureaus at all. So if they choose not to report a collection account after you pay it, that doesn’t directly violate the FCRA.
The Consumer Financial Protection Bureau notes that pay for delete agreements are “not prohibited specifically” under current laws. But they also caution that the practice “may violate the prohibition against inaccurate reporting” found in the FCRA.
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Pay for delete is not outright illegal.
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But it exists in an ethical gray area because it can undermine accurate credit reporting.
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Many consumer advocates view it as a questionable practice overall.
Now let’s examine the potential pros and cons of pay for delete offers.
Potential Pros of Pay For Delete Agreements
The potential benefits of pay for delete include:
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Immediate increase in credit score: Removing a paid collection could raise your credit score right away since you’ve erased a negative item. A FICO score could potentially go up by 50 points or more.
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Improved loan terms: With a higher credit score, you may qualify for better loan terms from lenders when you apply for mortgages, auto loans, or credit cards. This could save you money on interest.
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Motivating yourself to pay off debts: The thought of getting collections taken off your credit report can push you to settle old debts and improve your finances.
If a person has good credit in general, getting rid of one collection could raise their score just above 750, which is the mark for excellent credit. In that case, the best case benefits of pay for delete are shown.
Potential Cons of Pay For Delete
However, there are also a number of drawbacks to be aware of:
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Collection agencies don’t have to accept pay-to-delete requests, so they don’t always work. And even if they do at first, they might not actually change your credit report.
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Multiple collections: If you have several unpaid collections dragging down your credit, paying off just one likely won’t make much difference in your score.
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Original missed payments: Pay for delete only erases the collection account itself. But any late payments or other negative marks reported by the original creditor will still show up.
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May be unethical: As discussed earlier, pay for delete can contradict the spirit of truthful credit reporting under the FCRA.
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New credit models: FICO 9, FICO 10, and VantageScore 3.0 and 4.0 ignore paid collections when calculating credit scores. So pay for delete is becoming less relevant.
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Temporary benefit: Collection accounts fall off your report after 7 years anyway. Paying to remove it early may only give a temporary boost to your credit score.
As you can see, pay for delete often sounds better in theory than it works out in reality. Next let’s examine alternatives you may want to consider first.
Alternatives to Pay For Delete Agreements
Rather than pursuing pay for delete, you may want to explore some of these options instead:
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Negotiate regular settlement: Contact the collection agency and negotiate to pay off the debt at a reduced lump sum. While this won’t remove it from your credit reports, paid debts have less of an impact than unpaid ones.
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Dispute errors: If the collection account is inaccurate or fraudulent, file disputes with the credit bureaus to get it removed on those grounds.
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Improve credit habits: Focus on improving your credit habits moving forward – paying all bills on time, lowering credit utilization, etc. This can gradually raise your scores.
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Wait for expiration: Collection accounts fall off your credit reports after 7 years. Letting it naturally expire avoids paying for delete.
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Credit counseling: Meet with a non-profit credit counseling agency to go over your overall finances and credit. They can offer customized debt management advice.
Key Takeaways – Is Pay For Delete Worth It?
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Pay for delete exists in a legal gray area but is not outright illegal. Still, many have ethical concerns about it.
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The pros are it can immediately increase your credit score by removing a collection. But it’s not guaranteed to work.
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Multiple unpaid collections and new credit scoring models reduce the potential benefits.
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Negotiating a regular settlement or waiting 7 years for it to expire may be better options.
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Overall, pay for delete is risky, often ineffective, and not the magic credit cure-all that some portray it to be. Proceed with caution.
Why ‘pay for delete’ is becoming outdated
The account is still on your credit reports, but it’s doing less damage to your score than if you hadnt paid the account. And FICO 8, an earlier version widely used in credit decisions, ignores even unpaid collections with an original balance under $100.
There’s a catch, however: When you apply for credit, the creditor might not use one of the newer scoring models. If it uses an older model, the collection account could still be affecting your score. The FICO versions used by mortgage lenders, for example, still count all collection accounts.
If you decide to attempt a pay for delete agreement, you will need to draft a letter asking the collection agency to remove the debt from your account in exchange for payment.
Before writing the letter, ensure the debt is yours. If you have a debt collection on your credit report thats incorrect or not yours, you can dispute the debt with the three credit bureaus.
The Consumer Financial Protection Bureau notes that debt collectors are required under the Fair Debt Collection Practices Act to provide you with validation information, often in the form of a debt validation letter. If you have not received a debt validation letter, do not pay anything until you do.
How long do collection accounts stay on your credit reports?
Most collection accounts stay on credit reports for up to seven years. If you pay off an account in collections, it will still appear on your credit reports as a paid collection. Paid collections generally affect your credit score less than unpaid collectionsExperian . How Do I Get a Paid Collection off My Credit Report?. Accessed May 7, 2025.View all sources.
Keep in mind that pay for delete applies only to the collection account. It won’t remove the negative information reported by the original creditor, such as late payments, which also linger for seven years.
What Is Pay-for-delete And Can It Remove Old Debt? – Consumer Laws For You
FAQ
Is pay for deletion legit?
A “pay-for-delete” is essentially a bribe to get the collection agency to falsely report your debt as invalid to the credit bureau. If the agency knows that the debt is valid, then this is basically fraud. If the agency knows that the debt is invalid, then they are required by law to do this for free.
Can you do a pay for delete?
Calling or writing to the debt collector is the first step in Pay for Delete. You offer a deal: you pay off the debt, and the collector will remove the account from your credit report. You might not need to pay the full amount being requested.
What is the 777 rule with debt collectors?
The 7×7 rule, which is also called the 777 rule, is a rule in debt collection that limits how many times a debt collector can call someone about a certain debt. Specifically, it means a collector cannot call a consumer more than seven times within a seven-day period about the same debt.
How common is a pay to delete?
While removing collection accounts in exchange for payment was once common, the practice has become increasingly rare. That’s because all major credit reporting agencies — Equifax, Experian and TransUnion — require accurate and complete reporting of all credit information.