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Question, past collections account that says $0 balance, but its current status is..

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Anonymous
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Question, past collections account that says $0 balance, but its current status is..

First timer here, hope I'm posting this in the correct forum!

 

So I was looking over my CR (Equifax) and in my credit at-a-glance page I saw two "negative idicators". But my total past due shows "No accounts past due".  So I go to my accounts page to check out the 2 negative indicators.  They were both old collections from 2008 and I had paid both of them off within 30 days of being sent to collections.  So here is where I got confused.

 

Both accounts show a $0 balance, but they differ in their "current status".  One shows "Pays account as agreed" while the other shows "120+ days past due".  But how can it be past due when it has a $0 balance, and shows that I was 30 days late 1 time only in Jun 2008.  Worst Delinquency is "30 days past due".  But the current status of the account maintains that it is 120+ days past due!  Is this something that I should be concerned with? contact someone? Or is this just a glitch in the system since all of the other indicators show that I had paid in full and was no more than 30 days late at my latest payment?  BTW this was a short term school loan that I had taken out only for 3 months.  Date of last activity was Jun 2008 as well.  In the descriptions it says "- paid collection".  Its just that current status bar that shows that ugly "120+ days past due" .  Anybody experienced something like this before?

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2 REPLIES 2
HoldingOntoHope
Valued Contributor

Re: Question, past collections account that says $0 balance, but its current status is..

The comment line can still show the greatest delinquency prior to the payoff. I'm a little confused when you say collection. Do you mean that these were assigned to a collection agency or is the account still with the original creditor? If it is still with the original creditor and it was in fact never later than 30 days past due then you can attempt to correct the reporting in the comments. Remember that FICO reports only show the last two years of history on an account and not the full term of what is contained in your credit bureau report. Credit reporting extends back seven years for delinquencies.

 

If these accounts are with the original creditors they will also revert to good accounts at seven years after the last delinquency and may remain on your reports for some period after that as positive accounts. The norm seems to be that they drop at ten years after the account is closed but in some cases people have had them remain for longer. I have a friend who has a positive closed account on her reports that was closed 15+ years ago.

 

If you are going to dispute the validity of the information in the comment field you will want to take advantage of the Direct Dispute process versus disputing through the credit bureau. Do a search in the forums for the information, or hope that RobertEG chimes in as he is the resident expert on the process. Good luck in whatever you decide and welcome to the forums.

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Message 2 of 3
RobertEG
Legendary Contributor

Re: Question, past collections account that says $0 balance, but its current status is..

Commericial credit reports are notorious for mixing reporting code titles.  It does not necessarily mean the actual reporting was inaccurate.

It is often difficult to tell.

 

The reporting codes work like this.....

There are two basic codes that are relevant.... Current Status, and Payment Rating.

 

Current Status is always just a snapshot of the last reported status of the account.  It has no historical memory.

When an account is open or closed and unpaid, the Current Status will report the current delinquency status of the account.  However, Current Status is a mix of both current delinquency status and payment status codes.  When a payment event occurs, such as satisfying the debt, the prior Current Status showing its level of delinquency is over-written by a new code showing paid.  The prior level of delinquency is then shifted over to and saved in the Payment Rating code.

 

Thus, an account showing a Current Status of 120-late when paid would be updated to show Paid as its new Current Status, and the 120-late would be retained in the Payment Rating code.  The two codes together tell credtiors whether the account is paid, and the prior delinquency status when it was paid.

 

Commercial credit reports rarely, if ever, provide the Payment Rating code, and often even report it as "Current Status."  Technically incorrect, leading to confusion.

You can dispute, but may find the error to be with the formatting of your CR rather than actual inaccuracy in reporting by the creditor.

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