In the business of credit repair something we come across often is the confusion between credit vs. debt. How are they related, and what happens to the debt when a collection trade line is deleted from your credit reports?Credit represents your ability to borrow money. Debt represents money you have already borrowed. If you owe a debt and the respective trade line is deleted from your credit reports, you still owe the debt. Removing a trade line does not delete the debt owed on the account, it simply removes it from your credit report, so it is no longer a factor in your credit score.On the other side of the fence, if you pay off a collection account, it does not remove it from your credit reports. In fact, it may only serve to worsen your credit scores. The reason for this is that paying off an old collection will make it a new paid collection and a new paid collection has more negative weight than an older collection. We hear from clients frequently that they were instructed by their mortgage professional to pay off some old collections to qualify for a home loan. However, once they do it, they are surprised by a drop in their credit scores.