I've wittled away a $2700 hospital bill to $700....but

**purpleybutterfly** · 11-08-2011, 07:28 PM

I love Dave Ramsey, and his message. I have 700 bucks on a hospital bill. Orig bill was $2700, but I made a $100 a month deal with the hospital, and always paid it more when I could. Saying that, I could transfer money out of my savings and get this off my back, but it seems silly to do when there is 0% interest on it.

What are your thoughts on that?

**Palooka** · 11-08-2011, 08:48 PM

Eh, if you have a lot in savings and this is your only debt, I would do it. But otherwise I would keep making payments.

**frugalwarrior2** · 11-08-2011, 09:39 PM

1. I would want it off my mind
2. slow pay medical can effect your fico score too
3. Got the money,get rid of it. what if you lose your job?
but thats just me?

**Palooka** · 11-08-2011, 09:48 PM

How can paying your medical debt(which was agreed on monthly) on time effect your FICO?? Who cares if it's slow, it's getting paid and as long as it's an agreement, it won't hurt your credit.

It will only hurt your credit if turned in collections and not payed...but this is not the case with the OP.

**frugalwarrior2** · 11-08-2011, 09:55 PM

chill palooka,chill, lol
the length of time you have a debt is just another measure on how you get scored on FICO.

**Palooka** · 11-08-2011, 10:02 PM

Actually it's paying on time that matters most. And medical debt doesn't always act like consumer debt.

**Anna43** · 11-08-2011, 10:28 PM

Make sure you understand the hospital's policy. Our local hospital will send any unpaid bill that is over 1 year to collection. That definitely will hurt your credit score.

**khaski** · 11-09-2011, 07:11 AM

It is hard to say without knowing what's in your savings account and what your monthly bills are.....but assuming (as this is under Dave Ramsey) yuo have a roughly $1k EF then NO. You take out $700 to get rid of this debt, leaving you with $300, 'Murphy' will smell you a mile away! NEVER deplete your savings to pay off a debt, it only invites a disaster that'll force you back into debt.

You've already paid off $2k....either follow the $100 monthly plan or if it makes sense 'snowball' what you can towards it to get it done faster. any items you can put on craigslist/ebay to get a cash boost towards it?

**Greebo** · 11-09-2011, 08:44 AM

Originally Posted by Palooka

How can paying your medical debt(which was agreed on monthly) on time effect your FICO??

Debt is debt, so it's reportable on your credit report. The fact that it is settled for less than the original mount is already likely to hurt the FICO, in that regard, IF the Hospital reports it, which they might not.

Who cares if it's slow, it's getting paid and as long as it's an agreement, it won't hurt your credit.

Incorrect - paying less than originally owed with a settlement is a negative.

It will only hurt your credit if turned in collections and not payed...but this is not the case with the OP.

Incorrect.

**Nishu** · 11-09-2011, 11:48 AM

I would go ahead and pay it off if you're able. Whether it hurts your credit or not is really hard for us to say. Just because they're taking payments doesn't mean it's not hurting your credit report. They may still mark it as late, report it and then just mark it as paid when it's paid off. Since technically the debt is still probably late, they'd be within their rights to report it.

The length of time on your accounts matters, but usually that's in regards to checking accounts and credit cards. Having old accounts in good standing helps your credit. If the debt has already been reported as late on your credit report (which it might be) then it's going to be there until 7 years from the last activity. If you pay it off now rather than later, you'll start that ticker off sooner so it will fall off your credit report a couple months earlier. Probably not a huge deal in the grand scheme of things.

If you haven't already got your credit report, I'd go ahead and order one from annualcreditreport.com to see if it's on your credit report. If it's not there already, it probably won't show up on your credit report as long as you're making payments. If it is on there, paying it off will take a "late, unpaid" mark to a "late, paid in full" mark, and I'd pay it off as soon as possible and start that 7 year ticker.

**Greebo** · 11-09-2011, 12:14 PM

Re-reading the original question - you're not settling this bill at all, you're paying it over time. I misunderstood that at first.

So the question Dave would ask - would you BORROW $700 at 0% in order to put it in savings?

**purpleybutterfly** · 11-14-2011, 10:11 AM

Originally Posted by Greebo

Re-reading the original question - you're not settling this bill at all, you're paying it over time. I misunderstood that at first.

So the question Dave would ask - would you BORROW $700 at 0% in order to put it in savings?

Oy, when you put it that way!!! And I've heard Dave say this question multiple times as well. It just hurts to take out a chunch like that. I would be able to though and not let it hurt me.

And yes, I did not settle the bill, just paid it over time from Nov 2010. Would be nice to say I got it completely paid off in a years time.