Settling with a collection agency will hurt your credit by dropping your score. This happens because it updates the Date of Last Activity (or DOLA). And paying will re-start the clock on the Statute Of Limitations (or SOL). This is the period of time the collector has to take legal action against you.
Wondering why anyone would settle with a collection agency when it doesn't help their credit? Good question. There's not always a good reason to. There is the moral issue of paying your debts back. But this is questionable as the original creditor will no longer take your money.
Get Your Collections Removed Professionally
In some cases, we recommend speaking with a Credit Repair professional to analyze your credit report. It's so much less stress, hassle, and time to let professionals identify the reasons for your score drop.
If you're looking for a reputable company to increase your credit score, we recommend Credit Glory. Call them on (866-529-4304) or setup a consultation with them. They also happen to have incredible customer service.