<p>If you are unable to pay an outstanding bill, how does a debt collection agency work? </p>
<p>How badly does it damage your credit score?</p>
<p>This might help.</p>
<p>[myFICO</a> - FICO Credit Scores | Get a Free Credit Report Online](<a href=“http://www.myfico.com/Default.aspx]myFICO”>Your FICO Score, from FICO | myFICO)</p>
<p>From what I know, the agency will set up a payment plan you can afford, but before it gets to an agency, try if you can work out a deal with the initial entity.</p>
<p>Good luck!</p>
<p>From the point of view of a company that is trying to collect, there really is very little a collection agency can do. We sent six accounts to collections in the fall. One of those called us asking for more service which we refused to do until they paid so they did. The other five still haven’t paid and I’m guessing by this time, never will. We could take them to small claims court, but the fees for these small accounts are excessive. In order to take them to court, we either have to send them a certified letter which they refuse to accept, or have them served which costs money.</p>
<p>After sending them to collections, the agency can only call and write them a limited number of times and then they have to stop. They agency claims they will only report large amounts to a credit reporting agency.</p>