FICO 2008 and paying charge offs

Anonymous · ‎08-06-2008

I know this has been discussed a gazillion times, but, I keep hearing about all the supposed changes of FICO08 and want to bring this question back up & ask about recent experiences. Anyhow, I have just ONE thorn in my side, and I badly want it out ASAP! I have an alleged charge-off of ~$3300 showing on my credit file, dating back to 04. It's showing up as a regular credit card account (not collection), maxed out. I've been through hell and high water with the alleged OC, and the person in charge of this file (the only person who will work on it), is 100% firm on an $800 settlement WITHOUT deletion. My FICO with EQ is now 650 on the dot. With the new FICO08, if I just pay the darn $800 to show it settled, do you guys think my score will still go down, or, will that be fine? As well, if it goes down, how much, and for how long do you all think? I know about all the previous bad experiences with settling old charge-off's, but, does anyone have any recent experience? I'd greatly appreciate as much info as possible.

Anonymous · ‎08-06-2008

Anyone?

fused · ‎08-06-2008

FICO 2008 is not in use by lenders...not yet that is. I don't beleive there will changes to FICO 2008 with regards to COs and settling them. The current scoring models will treat a CO that has been settled as a serious derog. In your other thread, your plan is better...PIF and lower your revolving util.

Anonymous · ‎08-06-2008

So, are you saying it's going to be a significant difference in my situation if PIF, versus Settled, at this point in time? I was thinking of settling...

fused · ‎08-07-2008

A paid CO and a CO reporting as settled are equally bad. The point I'm trying to make is getting rid of the over-the-limit balance will help you.

Anonymous · ‎08-07-2008

Ok, gotcha...

jbh · ‎08-07-2008

Am I to assume no major changes exist regarding collections (such as utilities)?

In other words, will they weight old vs new or 'paid vs unpaid' differently in the '08 Version?

Anonymous · ‎08-07-2008

jbh wrote:
Am I to assume no major changes exist regarding collections (such as utilities)?

In other words, will they weight old vs new or 'paid vs unpaid' differently in the '08 Version?

Recently read an article in which FICO is reportedly saying a CO of less than $100 will not be counted in scoring. That would imply a CO of less than $100 wouldn't either.

Sounds like a major twist to me. Hmmm, what if you have 12 CO of $99 vs someone that has one CO of $102. Which person presents more risk??

Anonymous · ‎08-07-2008

gordonbs wrote:

Hmmm, what if you have 12 CO of $99 vs someone that has one CO of $102. Which person presents more risk??

A person's FICO score should be used as an aide in assisting a decision maker, not a sole decision factor.

This is why manual reviews are so important.

fused · ‎08-07-2008

gordonbs wrote:

jbh wrote:
Am I to assume no major changes exist regarding collections (such as utilities)?

In other words, will they weight old vs new or 'paid vs unpaid' differently in the '08 Version?

Recently read an article in which FICO is reportedly saying a CO of less than $100 will not be counted in scoring. That would imply a CO of less than $100 wouldn't either.

Sounds like a major twist to me. Hmmm, what if you have 12 CO of $99 vs someone that has one CO of $102. Which person presents more risk??

This will be true for collections only, not COs.