Do collection accounts age off your credit report after 7 years?
So I have debt from store lines of credit to a bank credit card. I haven't paid on them since at LATEST December 2007. Chase, citi financial (store line of credit) and Sears line of credit all have it showing closed but I am getting reporting from some debt collector companies.
I live in Arizona and just ordered my actual credit report today. I viewed the information online through a credit score tracking website. I read a lot of comments and researched online somethings. My questions are can any of them take me to court still because from what I read some debts are 3 years and some are 6 here in Arizona, I am not sure what they fall under, also at 7 years they have to stop reporting to my credit so I am told. Does this mean that it will show the old reports but they cant continue to report and since the original lenders have the accounts closed can the debt collector who purchased the debt also show up as a closed account or do they just disappear forever?
Any information to better understand when or if this will ever not be an issue for me would be helpful, as these debts were ran up by my ex and are thousands of dollars I cant and haven't been able to afford to even attempt to fix.
Do collection accounts get removed from my credit reports after 7 years?
—Jennifer
Short answer
Yes, but the clock is not the one most people count from. Negative items stay on your credit report for up to 7 years measured from the first missed payment to the original lender, and every entry tied to that same debt should age off on that same date.
Key points on this page
- Original lenders and creditors show payment default for up to 7 years from when you stopped paying.
- The 7 years starts at the first missed payment to your lender, not at the date a collection agency or debt buyer picked up the account.
- All negative trade lines related to the same collection account should age off at that same 7 year mark.
- Only one entry for a bill should show an unpaid balance. If a debt buyer reports a balance owed, check that the original lender no longer shows one.
- A collection account reporting a newer date of last activity prolongs the credit damage, so compare that date against the original lender’s.
- If the debt is still inside the statute of limitations to sue, a dispute can wake a collector who was not bothering you. Weigh that before sending one.
Original lenders and creditors show payment default on your credit reports for up to 7 years from when you stopped paying on the account.
When you first miss payments to a creditor or lender, you will see late pays show up in 30 day blocks of time on your credit report. If the accounts remain unpaid long enough, those 30 day incremental late pays turn into a charge off reporting on your credit. With credit cards, charge offs normally occur within 180 days of consecutively missed payments (they can happen sooner than 180 days).
The 7 years the negative item stays on your credit report starts from the first missed payment to your lender.
When your accounts get this far behind, it is standard to have the account placed with outside collection agencies, and often repeatedly. Many creditors have a practice of selling off debts that remain unpaid long enough to debt buyers. They are legally transferring the rights to the debt to someone else, as is often laid out in your original contract with them.
Collection Agencies and Debt Buyers Showing Up on Your Credit Report
When an additional entry from a collection agency shows up on your credit report it is important to look for some key items:
- Is the new entry showing a balance due? A debt buyer who reports a collection account to the credit bureaus with a balance owed should be matched with the original lenders negative credit reporting to be certain that the original lender no longer shows a balance is owed to them. You should not have more than one credit entry showing an unpaid and due amount on your report for the same bill.
- Does the collection account show a date of last activity on your report that is different than the date your original lender is showing? Collection accounts that are reporting separate from, but related to an existing negative item on your report, should not show a newer date. If a newer date is used by a collection agency reporting, it prolongs the credit damage and will take longer for you to improve your credit.
All negative trade lines related to the same collection account should age off of your credit report at the same 7 year mark you use to calculate your first missed payment to your original lender. The exception used to be when people got sued for collection and ended up with a judgment over one or more of the debts – which would show in the public records section of your credit report for 7 years from the date judgment was entered in the court.
Most judgments obtained in state courts were taken off our credit reports with Equifax, Experian, and TransUnion as of July 2017
What to Do If You Need to Dispute a Collection Account on Your Report
I will have an upcoming article about disputing incorrect information on your credit report, but for now, it is important to consider the following:
If your debt is within the SOL (statute of limitations), to legitimately sue you for collection, you should carefully consider whether or not to send a dispute about a collection account on your credit report, even if it is showing incorrect information. When there is still room on the clock to sue you, sending a dispute may wake the collector to the fact that you are:
- Still an unpaid account.
- Care enough to start cleaning up your credit report (usually for some credit goals, which means you are more collectible).
If your debts are beyond the SOL to sue you legitimately, you should have less concern about waking a sleepy debt collector who may not have been bothering you, with disputes about getting your credit reports corrected.
Legislation was passed in 2011 that changed the SOL from 3 to 6 years in Arizona. Given the information you shared about 2007 being the earliest date of last payment, your debts may/may not be off of the current debt owner’s radar. You would need to be certain about the date each of account was last paid. Any of them you know were paid last in 2006 would be clear of the SOL.
Reviewing your credit reports for accuracy when you know you have old collection items is important. Staying on top of when and how to get your credit reports corrected will help you plan for future access to credit at fair prices.
If you have a particular issue or question you can post in the comments below for feedback.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry. He is available to speak with you about your financial struggle and helps people resolve their debt problems daily.
Hi Michael,
I am in such a mess and would love if you could offer me some advice. When I was 24 I went back to college to become a teacher. In addition to federal student loans, I took out private student loans to supplement my income. I also had some credit cards that I used to help pay for my living expenses. I didn’t realize at the time that my salary as a teacher would never cover my loans and additional bills. I did work a part-time job after my school day was over but became super overwhelmed, quit my part-time job and stopped paying my bills. I have not paid them in about 3 years. I recently went to a bankruptcy attorney who recommended I try to file for a chapter 7. I paid him $2000 and after a few months of waiting for his secretary to do the paperwork I am told that I make too much money to meet the “means’ to file. He is charging me $750 and refunding the rest. He told me that my student loan debt is $103K and my credit card debt (dischargeable) is $17K. I have recently started paying my federal student loans, but not the private ones. I know the private student loans are now with an attorney and they have sent me a few letters. I am not sure where to go from here, as I certainly cannot afford to pay all of this off with my salary and my current living expenses. I do not own a home or have a car loan. I live in Rhode Island. I am trying to make some positive changes in my life, however I do not want to make the mistake of contacting these creditors and screwing myself even more. Should I just sit and wait for them to take action and hope 7 years goes by before they do? I am now 38, do not have any credit cards and feel like I cannot do anything (such as purchase a home/car/or get my own lease). Please help…
Thank you,
Kimberlee
Give me a call at 800-939-8357 = and choose option 2. I have a healthy amount of questions to ask you in order to get to a place I can offer actionable feedback about where to go from here in your situation.
Dear Michael,
I have been in debt since started college. Well I was not very smart about spending and such. I stopped making payment since either 2006 or 2007. It’s been a really long time and I’m not too sure what’s going on anymore. I also moved from New York to California since (not because I was running away from making payments but due to moving and other personal reasons). I never used the credit report service or anything because I didn’t want to pay for it. Now I got a chance to look and I’m not really sure how it works. I recently looked and it said a legal item was filed for me to go to court in 2010. What kind of action should I take at this point?
I am going to need more details about that legal item if I am going to offer much feedback. Is it a judgment? If so, for how much, and who is the judgment creditor?
Here are some resources that relate to your issue:
How to settle judgment debts.
Judgments on credit reports.
I want to apply for law school.
My debt was from Louisiana.
I have about a year and 1/2 for the collection accounts to fall off.
They say they will use my Present credit report (if I apply now) three years fom now to be admitted to the bar in the future.
My question is … Is there anything I can do to get the collection accounts off now before they age off, so I can have a cleaner credit report to apply for law school. Or…
Do I need to wait til they age off then apply?
I’m 51, and wanted to apply as soon as possible. However, if the collections are on the report I use to apply and it is used then (3 years from now) to be admitted to the bar I know I need to wait. However, im so close to them aging off, I am wondering if I can get them removed this year so the cleaner report (without the collection accounts) will be possible.
Shalom,
Sam
Are these debts still unpaid?
Hi Michael,
Can you tell me what a debt collector is required to have as validation of a debt? Portfolio Recovery Associates mailed me documentation of their purchase, but that doesn’t show a breakdown of why I would be responsible for that debt. Is this required in order to have the alleged debt removed from my credit report?
General debt validation requirements are so low that debt collectors can trip over them. I really like the explanation given by Jared Strauss about this element of debt collection.
PRA does not generally owe an explanation for why a debt will remain on your credit reports (assuming the debt is legitimate, and showing accurate, complete, and current information).
Hello Michael,
question…. I just checked my reports I had one collections account and it was removed ( happy dance) from 2 agencies after the 7 year mark ( lost job couldn’t find employment for 6 months,yada yada I’m sure you have heard it all ) but the orignal account is still showing on Transunion .. Do I need to do anything? Thank you in advance.
If it has been more than 7 and one half years since you fell behind paying the account, send a written dispute to Trans Union and get it removed. If that amount have time has not lapsed yet, is it really close?
Thank you Michael, looks like I have another 4 months to reach the 7 1/2 year mark. 2016 will be a good year! If it doesn’t fall I will be taking your advice. Thank you for being available and answering my question! Take care!
Dear Michael,
Please remove my last comment as it has my last name printed and I don’t want the comment “searchable” by the internet. Thanks very much!!! I’m sorry I posted my last name.
I removed your last name. If you would still like the comment removed let me know and I will delete it.
Hello Michael,
I have a derogatory mark on my TU report for a $23,000 student loan with Nelnet, that I opened in 2001, in Florida. It shows the account was closed in 2013, which I guess is the time First Mark collection agency took over the loan. I never made a payment on this loan since 2003, but for some reason it remains on my TU report. Shouldn’t this have dropped off my CR by now? Please help???
I’m sorry, I made a payment to the debt collector in March 2014. This was done in order to attain a loan to purchase a home last year. However, I don’t think this should’ve affected the drop off date. What are your thoughts?
Nothing you shared suggest that the the account should remain on your credit reports, regardless of whether you made a payment last year or not.
I would file a dispute with the credit bureaus that are showing the account, and send a copy to the First Mark collection agency and/or Nelnet (whoever is providing the out of date negative credit reporting).
Send your disputes in writing certified mail. Keep copies of all that you send. Post an update with what develops and lets go from there.
Thank you for the advice, Michael. I will keep you posted.
Hello Michael,
I spoke with Transunion and Experian before filing a dispute. I was informed by both companies that this account was first reported delinquent and sent to collections in Sept 2009, therefore the drop off date will be May 2016 (a few months early due to some exception). As I stated before, this loan was opened and distributed in Florida, for a school I attended in Florida, and I have not made a payment on this account since 2003, which by Florida’s statue of limitations the drop off date would have been in 2010. I’ve resided in New York for the past 10 years, and it seems for some reason this account is being held under New York’s statue of limitations (which I believe is seven and one half years from the time the account is first reported to a collection agency, determines the drop off date). Do you think I should file the dispute or wait the nine months until it drops off? I don’t plan on making any major purchases until buying a car next summer and a home in three to five years, but I do want to get my credit as strong as possible by the time I’m ready to purchase the vehicle next year. Again, thank you very much for the advice!
And the loan(s) were 100% private student loans, and not federal? You never consolidated the loans?
Yes this loan is 100% private. I’ve consolidated other private loans from Nelnet and have since paid them off, but I never consolidated this one.
I would file a credit reporting complaint with the CFPB. Review that link in its entirety before you file.
The student loan should not be reporting for this long after no payments had been made on it.
Could this have a negative effect on my credit if the dispute isn’t settled in my favor? The folks at the credit bureaus suggested I wait the nine months. I also spoke with the folks at Nelnet, who couldn’t tell me anything besides the fact that I filed for and was denied forbearance on this loan and that there is no payment history shown. Just trying to get all of my ducks in a row before disputing, so I am not caught off guard. Thanks, Michael!
Credit reporting disputes do not necessarily result in additional damage. The impairment to your credit reports from a derogatory item are not able to go up or down in severity levels. I do see people have trouble with disputed accounts when they are going for a mortgage from time to time (pretty rare really). But any dispute is removed along with the entry itself when it is too old to remain. I cannot see any impact to you from your filing a dispute with the CFPB based on what you have shared.
I am in the process of filing the dispute with the credit bureaus and the CFPB. However, while waiting for the history of the account to be mailed to me, I began doing some more research. Now a major concern of mine is the possibility of being sued. I’ve read that the statute of limitations (depending on the State) restarts after certain instances, making it possible for creditors or collection agencies to pursue legal action. Do you have any knowledge/advice on this (given the information in my previous posts)?
There are some pretty rare instances where you would reset the SOL to sue by reaching out to a debt collector or creditor. Disputing inaccurate credit reporting is not one of them.
Are you still in Florida?
Im not worried that disputing will reset he SOL. I am wondering if making a payment on the loan last year or the fact that I now live in another state possibly reset the SOL, and am I at risk of being sued. I am currently living in New York. I made an uninformed decision to pay the collections agency last year. I have not signed any paperwork from them stating I agree to pay, I just had them collect a payment directly from my bank account.
Making a payment to a debt collector is often going to be construed to have reset the SOL to legitimately be sued for collection.
Moving to another state, and once residency established, can often result in the new state controlling the SOL that could be applied by the court.
You should consult with an experienced debt collection defense attorney in New York about these concerns.
The payment to the debt collector does not reset the SOL for credit reporting purposes.
The risk of being sued is real enough with a reset SOL. Have you considered settling the account for less than the full balance owed?
I have a question. I have an account that went into collection 10 years ago. I am in the state of Florida. Recently, beginning this year, I had a sudden new item for an old account pop up in my credit report, to which I started finally paying off. The original creditor is a bank, but the current creditor is a collection agency, the report claiming that the debt started as of 2015.
If my understanding is correct on this, this is unlawful re-aging of a collection account is it not?
Furthermore as I mentioned, I started paying the creditor directly, then just today I get a letter in the mail from another company that just does the collecting, are NOT the creditor, meaning they contracted someone else to collect on the money, however on this document claiming the new money taker, they claimed the current creditor is yet /another/ completely different creditor. The creditor’s in question are Jefferson Capitol Systems (the one I started paying), and the new one is RJM Acquisitions.
I understand creditors can hire collectors to take money for them, but why would they do such a thing if I was directly paying them? Is it just to bug the heck out of people intentionally?
It sounds like the account was already sold. Did you arbitrarily start making payments to Jefferson Capital or did you call and set that all up in advance?
Why did you decide to start making payments on a 10 year old debt?
Which debt collector is it that started showing on your credit reports?
Hi MIchael,
The SOL for debt collectors in PA is four years, right? The date that the original accounts were opened that I am trying to dispute were in 2010 and 2007. Does it matter when they were sold to the collection accounts?
The collection accounts in question are scheduled to remain on my credit report until November, 2017 and Dec, 2017. I don’t see anything listing the date they were from the original creditor.
Yes, the SOL for legitimate lawsuit on credit cards is 4 years in PA. The SOL appears to have passed given the information you shared. Sending in dispute and validation requests now that you cannot be sued is somewhat more advisable.
Who are the debt collectors you are dealing with?
Can you point to anything inaccurate on your credit reports from them?
It matters that the debts were sold to collectors in so much that the original creditor should then report a zero balance owed them (but still as a charge off), and also that the debt collector reporting should drop off at the same time the original creditor drops off.
Hi Michael,
Do you recommend asking for validation with the creditors or credit bureaus first, or contacting both simultaneously?
Is the SOL to legitimately be sued for collection passed in your state?
Are the debts showing at least some type of error on your credit reports?
Hi Michael.
What advice do you have if a dispute with the credit bureaus was updated, but not deleted? What is the best way to appeal? Should I try appealing again with the credit bureaus or is there a higher agency that I should appeal to?
Thank You!
Kim
Can you be more specific with the nature of your dispute, the outcome, and what your goals are?
Hi Michael,
The only outcome of the initial dispute was that it was “updated”. I disputed it online and wasn’t very specific at the time. I know more now and I have a better idea about the things that I need to focus on in the letter.
My goal is to buy a house within the next 1-2 years. Everything in collections will fall off of my report by 2018, but the sooner they come off, the better…
If you were not specific with your dispute, I would try that again. If there are items showing on your credit report that are incorrect or incomplete, but not getting addressed with your disputes, file a credit reporting complaint with the CFPB.
You can get a decent rate on a home loan with paid collections still on your credit reports.
Hi Michael,
I have a secured credit card with Capital One that I got for the sole purpose of increasing my credit score. I pay the card off completely every single month and it reflects a $0 balance. It’s being reported as a negative account on my credit report because it’s being listed as inactive, even though I make purchases with it every month. Am I wrong to pay it off completely every month? Should I keep $5 on it every month to show that it is being used?
I’m currently disputing this with Capital One, but I’d like to know the best approach for the future.
Every negative item on my credit report is scheduled to fall off by 2018, so I’m thinking that I will just wait those out. However, one of the things that is bringing my score down is the ratio of negative to positive accounts. Should I open another credit card or two to increase the ratio of “good” credit?
Thank you so much!
-Kim
The account should not report as a negative just because you pay it off. Let me know how the dispute works out.
I do often suggest having to open revolving accounts like credit cards. Perhaps you can wait to open one that is unsecured to add to the secured one you have with Capital One already.
Hello, According to my credit report, I owe approximately $4,000 to Apothaker. The account was sold to them by LVNV, and they claim that the original debt belonged to Spring Leaf Financial. I have been making $50 payments to Apothaker for a year. Unfortunately, I didn’t know at the time that this could reactivate the debt. The only information that they could provide me with when I called is that the original debt belongs to LVNV, who purchased it from Springleaf Fianancial. I live in PA. If it is close to 7 years, will all of the corresponding debt be removed from my acct.? Apothaker doesn’t show up on my credit report, but LVNV and SpringLeaf Financial do. If it’s been 7 years and the account with SpringLeaf is due to be removed, will the acct with LVNV also he removed from my credit report? I spoke with Apothaker today and stated that I wanted the automatic deductions to stop. Will this reactivate my account?
I disputed multiple items on my credit report online about 2 weeks ago. I have not received a response yet about this dispute. I’ve written a letter that I’ve prepared for the Credit Bureaus that contains more detailed information.. Should I submit the letter via certified postal mail, or should I wait the remaining two weeks?
Thank You!
The Spring leaf and LVNV entries should drop off your credit reports at the same time, and as much as 7 and one half years since you first missed a payment to Spring Leaf.
Be sure to watch that LVNV drops at the same time. There has been a tendency for the collection company to remain longer than the original creditor in the past.
You appear to still be on the hook for your states SOL to sue you in order to collect. That is because you have been paying, so be aware that the the account not appearing on your credit can still come back to bite.
I would not send any additional disputes to the credit bureaus until I know the outcome of the recent ones you submitted.
Michael, seems like every time I check on credit karma I find something else I need your help with! I don’t know how credit reporting works or the ins and outs of reading a report so I do apologize if my questions seem foolish!
I noticed there is a tab on credit karma that shows collections accounts that have been removed. On my TransUnion report an account was removed on 04/03/2015 with a balance of $249. The collection agency is listed as CR SYST INTR and the original creditor is Green Mountain Energy. The thing is this account is still listed on my Equifax report? With a balance of $229 and high balance of $249. I don’t even know what my question is here but does this seem strange at all? I’m not sure why a collector would remove it from one CRA but not the other(s)? Perhaps the strangest thing of all is that this account hadn’t reached the age of removal, I believe I last paid on this account in early 2011. I’m definitely not complaining about it no longer showing on my TU report! I’m just not sure why they bothered removing it from one and not the other? Is this a normal thing for a collection agency to do?
All three of the major credit bureaus tend to have mostly the same items on them. But there are times where some accounts appear on one, and not the others, or like what you have seen, an account deleted inexplicably.
I do see anomalies like what you describe all the time. I am not much for making anything of it when it can be viewed as favorable to you.
It likely was not the debt collection agency that caused the deletion. It sounds like TransUnion is the reason for the deletion.
Ok that was just a little confusing, thank you for clearing it up! Have a good day 🙂
Thank you for the advice (and the hand holding!). I don’t have any plans as far as buying a home or another vehicle for at least 3 yrs or so, but I am in the process of consolidating my student loans that are in default (only $761 thankfully) so I can then be eligible to apply for a new federal loan to go back to school and finish this time; I was a hot mess when I was younger and I kick myself for it daily!! The consolidation will be complete in about 10 days. I realize that the original loan will stay a negative, but paid in full, but will it still fall off after the 7.5 yrs like any other account or is there a different set of rules for fed. student loans? Also I will most likely have to apply for an additional private loan. I’m hoping to get my disputed accounts resolved by the time I need to apply for the private loans so that maybe I’ll have a shot at being approved for the amount I’m aiming for which would be about $5-6k. My score is low, embarrassingly low, so any improvement, however small the bump in score would be, is extremely needed!
There are some differences for some federal student loans when they remain unpaid. That will not be the case here, as yours will be paid.
I live in Texas. In May 2008 I was issued a credit card through Bank of America with a limit of 3200. I was 19 at the time; I had no business having a credit card to say the least! I ended up using that card to put a down payment on a vehicle and honestly once I did that I never thought about the card again. I never made any payments on this card. As far as I’m aware it was never placed in collections, or at least as of today it isn’t. The account however is still on my credit listed under Bank of America. It is listed as closed-derogatory with a balance of zero with no payment history reported. Status is collection/charge off. Remarks: charged off as bad debt. acct. closed by consumer. The problem I’m having is Bank of America has reported that the last payment date was Jan 15, 2010. This is false and as a result it will stay negative on my account for two years longer than expected.
Is this situation something I’m able to dispute? I was expecting to see this removed as of this year and now I see it will remain for two more years. Should I contact BOA to see what their records say first?
The 7 and one half year credit reporting time frame will not have run it’s course until sometime at the end of this year. You can dispute it now proactively in order to establish the correct drop off date. The account should get corrected, perhaps even removed early. Based on the May 2008 dates, it can stay up for a bit longer.
The zero balance reporting suggests to me that BofA sold the debt to an investor.
thanks for responding Michael! I did forget to mention that I found this info on credit karma and from I can see they do not have removal dates listed for any of my trade lines so I went ahead and ordered the free annual report from two companies, leaving the third available so I can check later if the issue has been resolved (if needed), but I think I will wait to see what the actual removal date is before I send the dispute. I have another couple of questions unrelated to that account.
1. If I have accounts placed with collection agencies shouldn’t I still see those accounts listed with the original creditors only with a balance of zero? If i don’t see the original creditors does it mean that the debt has fallen off already and they are reporting on old debt or is this totally normal and correct to not see them listed with the original creditors?
2. I also have an auto loan in collections with ACCL FIN SOL with a balance of 4840, status is open. The account is also listed with the original creditor (NMAC) status is closed, derogatory. They too show a current balance, but of 4740. I thought after the collections agency took over NMAC would have to zero out that balance? And why is the balance between the two slightly different? Is any of this normal? Also not sure if it’s important for your response, but the remarks from NMAC are: charged off as bad debt, profit and loss write off.
any info helps, thank you!
If you see an original creditor reporting with a balance still owed to them, that would generally mean they did not sell the account. But you will often find the creditor has your account placed with a third party for collection.
Not all unpaid debts are sold. Not even close. And some banks do not sell any debt. But if your original creditor is showing with a zero balance owed on your credit reports, they likely sold legal rights to collect the balance to a debt buyer.
If you do not see the original creditor on your credit reports it is not an automatic that the debt is passed the 7 and one half year limits for most derogatory credit reporting. It could be missing for a myriad of reasons (system bug, account anomaly, etc).
There should not be a balance being reported as owed for the same account twice. That would be erroneous because it incorrectly skews your DTI. It is not normal to see these days, but it does happen. You can dispute that as well.
The charge off remark is normal. It is an accounting function that has turned into a credit reporting notation. You can read more about that here: https://consumerrecoverynetwork.com/question/settling-charged-off-credit-card-debts-with-collection-company/
Ok just so I’m 100% clear, for the auto loan, does paragraph one or four apply? I guess paragraph one confused me a little, does this mean that an original creditor can still own a debt while that debt is placed with a third party for collections? And how would I know if this is the case or if it is a legit error like stated in paragraph four? sorry I’m really new to all of this!
Yes, it does mean the original creditor can still own the loan and rights to collect, but have it out with a debt collector to see if that gets you to pay. The third party generally gets paid only when they get you to pay. This is common place.
What isn’t common place is to have the creditor and the debt collector reporting balances due at the same time. That means there is an error and it should be corrected. If it were me I would call the original creditor and ask them if they still own the account, and if not, who they sold it to.
Ok great I will do that now! I cannot begin to thank you enough for this information! I’m sure I will have many more questions for you in the future! thank you!!!!!
Hi Michael, I called NMAC and they have sold it to Credigy, however its being reported under ACCL FIN SOL. I assume this is bc Credigy also sold the acct? So I asked the representative why they’re still reporting a balance even after it’s been sold and she said it’s bc I didn’t zero out the balance with them?? I’m so incredibly confused at the moment! Does the comment you made about both the OC and CA carrying a balance at the same time apply to my situation and is something I now need to dispute?
Yes, you do need to dispute it. The person from NMAC either misspoke or did not know the correct response to give you. You could dispute that with the credit reporting agencies as inaccurate and perhaps even take a shot at disputing the entry from Accelerated Financial Solutions as not having a debt of yours.
Regardless, the entry from NMAC should show a zero balance, and both NMAC and Accelerated Financial should both fall off the credit reports at the same time.
Alright I will send the
dispute(s) then. I’ve never disputed anything before, for the NMAC dispute do I say, “they’ve sold this account and the balance they’re reporting is inaccurate”? Or simply, “this information is inaccurate” and the CRA’s will figure out which part is incorrect?
I would indicate what is wrong with the credit report entry on this one. There are times I would send a more ambiguous “this is incorrect, please remove the account” type of dispute. Doing so here with it so close to the account dropping off from it’s legitimate age may result it just being deleted.
I would argue either way. Do you have a specific credit goal you want to accomplish between now and December?
Michael, When we were denied credit a few months ago they told us that our FICO was 655. I couldnt understand this because I subscribe to Equifax and we had seen it recover over the past 2 years to recently 685, which is the magic number to open a lot of lending doors. But this 655 keeps coming up in denials. Well I found out that they were using Experian and I pulled our Experian to confirm it saying 655 FICO. All aspects of the credit report appear to be simialar EXCEPT AMERICAN EXPRESS.
Unlike the Equifax report that simply says CO and then ends in OCT 2011, With no further reporting ……the Experian Report has AMERICAN EXPRESS continually being reported as CO every 5 months since that date. The most recent entry says CO June of 2015. They are doing this on two small AM EX accounts. that were long charged off in 2010 for 1900$. and $1200 Back then I tried to negotiate a settlement but they were the only ones that would not. We had a third AM EX account with a larger balance which an attorney negotiated a settlement with them. For that account that was negotiated settlement it stopped reporting in 2011 and does NOT show this continual CO every 5 months as the other two do.
The accounts do say “Closed at grantors request” but keeps getting reported as a fresh CO every 5 months. I got alerted to this as an “account change” notification on my Equifax monitoring.
Is this continual reporting lowering my Experian score and would this explain why the dependency of the FICO score between Equifax and Experian? If so how can I stop this?
Thanks
Just to clarify the EXPERIAN REPORT looks like this:
2015 2014 2013
CO ND ND ND ND ND CO ND ND ND ND ND CO ND ND ND ND ND CO ND ND ND ND ND CO
2012 2011
ND ND ND ND ND CO ND ND ND ND ND ND CO ND ND ND ND ND ND CO ND ND ND CL
If it were me I would file a dispute with the credit bureau about any charge off being reported every 5 months. Charge off only happens once, and typically 180 days after payments stopped, so many years ago in this case.
I would send my dispute in writing via certified mail.
Depending on the outcome I may look to escalate this as a complaint to the CFPB. I may even skip the bureau complaint and file with the CFPB instead.
Thank you Michael, I just wanted to make sure this was not acceptable practice before I tool it any further. I found out they are also doing it on Trans Union. We have been turned down several times on loans because of the 650 FICO score. This appears to be where it is coming from. I will let you know the results.
If the loan you are seeking is mortgage related you will want to resolve any unpaid collection accounts too. There are not many resources for home loans today when you have unpaid collections. A 620 credit score or higher is only part of the equation.
Michael, I wrote to the CFPB but they have not been very helpful. Basically all they did was send my complaint on to the credit bureau and they responded that they updated the file. To my horror all Experian did was UPDATE the file to say CO again and saying that the account will be deleted in June of 2018.
So I am a bit confused still. It is looking like they are ALLOWED to keep reporting the balance owing and place the CODE “CO” in the current month for as long as the 7.5 years since the first delinquency. It seemed to me that you thought this was not allowed but I am not getting that feedback from CFPB nor the Credit Bureau.
Also now it is worse, my EQUIFAX has started reporting the same data. Our score went from a 685 to a 650 after American Express started to do the same thing on Equifax.
Just to be clear, even though the original CO was done in January 2012, they continue to update the Closed Account with a NEW “CO” code every few months, and they are listing the BALANCE OWING as the full amount that was charged off.
Would you mind giving me your opinion on this again? I am prepared to obtain an attorney if I have a case here.
Here is what appears on the file:
AMERICAN EXPRESS
Account Date Opened Balance Date Reported Past Due Status
XXXXXXXXXXXX 11/24/2000 $1,744 08/04/2015 $1,744 CHARGE-OFF
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2015 NR NR NR NR NR CO NR
2014 NR NR NR NR CO NR NR NR NR NR CO NR
2013 NR NR NR NR NR NR NR NR NR NR CO NR
2012 CO NR NR NR NR NR NR NR NR NR NR NR
2011 NR NR NR NR NR 120 NR NR CA NR NR
Account Number: -XXXXXXXXXXX Status: CHARGE-OFF
Account Owner: Individual Account. High Credit: $2344
Type of Account : Open Credit Limit:
Term Duration: Terms Frequency: Monthly (due every month)
Date Opened: 11/24/2000 Balance: $1,744
Date Reported: 08/04/2015 Amount Past Due: $1,744
Date of Last Payment: Actual Payment Amount:
Scheduled Payment Amount: Date of Last Activity: N/A
Date Major Delinquency First Reported: 01/2012 Months Reviewed: 44
Creditor Classification: Activity Designator: N/A
Charge Off Amount: Deferred Payment Start Date:
Balloon Payment Amount: Balloon Payment Date:
Date Closed: Type of Loan: Credit Card
Date of First Delinquency: 06/2011
Comments: Charged off account,
Account closed by credit grantor
This is so upsetting, we were just about to do a loan and now this on equifax has dropped the score to 653
I think there is a misunderstanding of what you have going on. If American Express is reporting you as a freshly charged off debt every month, or every few months, that would be inaccurate. If there is a charge off showing on your credit reports for the account once, that should be the only charge off that impacts your scores. Future charge off reporting of that already charged off account should not impact your scores further, but other elements of reporting combined with an unresolved charge off can.
I would definitely encourage you to speak with an experienced FCRA consumer law attorney. What is the name of a nearby larger city? I can help you locate someone with the experience you need.
What type of loan was it you were going to do? If you were looking to get a home loan approved with unpaid collections you should hold off and negotiate a settlement on the AMEX account before hand. Home loans are regularly denied with unresolved debts on your credit reports.
Hi Michael, We already have the loan approval for a HELOC. when they pulled the credit we had a FICO 685. Hopefully they will not pull it again before closing, or they will see the 653.
I too am a bit confused about the terminology. As you can see from what I posted, they are entering a “CO” code every few months for the current month. It seems that the entering of this CODE on the current month seems to have altered the credit report score. There is nothing else that would have impacted Equifax to lower the score to 653.
No other account gets updated with a new “CO” code in the current month…only the AM EX accounts.
I contacted an attorney today, and have a phone meeting setup for tomorrow. Perhaps I am misunderstanding the entire issue? Are they able to enter a CO code every couple of months? Does this lower the Credit Score when this happens? This is what I dont understand, but it appears that when they do this, our score goes down 30 points which is devastating!
I will be a little surprised if your HELOC goes through with an unpaid collection account on your credit reports.
A charge off continues to have a credit score impact. The freshness of a charge off does hurt more than an existing stale one. I cannot tell that is what is happening here. I can assemble a narrative that suggests it is not, and also one that suggests that is what is happening.
Post an update after the attorney consult. There may be something like this he/she has litigated before that could shed some light.
Hi, I just saw a collection on my credit report las month, june 2015, from tmobile for the amount of 57. I never recieved a letter from them and the debt was sent to a collection agency. I didnt know about that debt and never be late on anything, they just had a wrong address and send the mail there. The account shows the date 2009. The collection will stays on my report 7 years from 2009 or the posted date 2015? Can I sue them for the mistake they did? As soon I saw the debt I paid it but tmobile and the collection agency said they cant take it out from my credit report. Its frustrating that due a operator mistake now my credit is suffering. I live in Puerto Rico. Thanks
A paid collection account that is 6 years old will not harm your credit scores much it at all. What are your current credit scores? How recent was the payment you made to the collector (recency of the settlement can bring the credit score down temporarily)?
My Equifax score was753 before june, now is 707 after they post the collection. As soon I saw the collection posted I paid it. In the report said the last date of payment aug 01 2007 and but they reported on june 2015 the collection
That update of the paid collection being so new dropped your credit score. The account is old enough to be deleted so dispute it as too old to appear on your credit reports with the bureaus (send in writing using certified mail).
Hi, I’ve been repairing my credit for the past few years, started with a Equifax report and pretty much paying every collection off seen on it without knowing that stuff could just fall off which many of them were probably close to. I got 1 card, pay off in full at closing every month and watched my score rise using the free TU credit tracker that Capital One offers along with a auto CLI of a few thousand of responsible usage. I was sent a pre approval notice for a credit card from my bank and decided to go for it to get a larger available credit amount to help keep my utilization percentage down from already having another card. Once I got the card though I was shocked to see a low score from Equifax where my TU score was much higher. I looked into it using one of those free sites that pulled from Equifax (Quizzle) to see a 6+ year old collection of $484 that didn’t show on the complete credit report which was done only a year prior. Should I pay off this debt that is 1 month away from being 7 years old or should I just wait and see what happens? Will my score rise higher paying it off in full rather than letting it fall off? I’m in Florida since sometimes you seem to ask which state.
Are you looking to accomplish a specific credit goal in the next 1 to 6 months? If so, post what your credit goals are.
If it were me, and I were not going for a home loan between now and the collection account falling off, I would wait it out.
Hello,
I was in a car crash Dec of 2010 I didnt have insurance at the time and i have bills that add up to $46,000. In 2011 my lawyer told me he stopped them from getting any higher and from people trying to contact me about this. Ive never had a single person try to contact me about his and i only got 1 bill for each service done to me that night. Ive never paid anything to them. I guess im just confused on when and if they will ever be off my record?
We tried to fight it since i was still living at home, i was 18, but my parents were taking care of me. My dads insurance had passed that i was able to get back on his insurance a few months before the crash but wouldnt take on new dependents till the 1st of the year and this happened mid Dec so i got screwed.
What state are you in?