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I need an answer from the experts please...I called my lender and asked if a paid lien on my CR still affects my score, she told me no as long as it has been paid, is this true someone please help?
I have a lien from the IRS that I paid in full in 2009 and it was released. I just got my first credit card in 11 years in September, no other tradelines and no collections on my credit since 2007 which was one medical bill for $350 that they neglected to bill to my insurance. Before that, no collections since 2005 which were also medical and a defaulted student loan that has been paid in full, as well. I was pre-approved and my scores as of Feb 6th are listed below in my signature.
Thank you for that information, My Lender said it shouldnt change my score since it has been paid, but i thought I read in the forum that it does.
Unpaid liens hit your credit hard initially... released liens shouldn't decrease your score.
To add to that... paying old delinquencies on your credit can hurt your score because it reactivates it BUT a lien is different than a collection.
@K_J wrote:I need an answer from the experts please...I called my lender and asked if a paid lien on my CR still affects my score, she told me no as long as it has been paid, is this true someone please help?
Hi, K_J. In answer to your question, you may find this link helpful.
Hope this helps. Good luck, and enjoy your new higher score.
Paid and Withdrawn IRS Tax Liens to be Removed From Credit Files
http://www.smartcredit.com/blog/2011/02/25/paid-irs-tax-liens-to-be-removed-from-credit-files/
@LondonMassey wrote:To add to that... paying old delinquencies on your credit can hurt your score because it reactivates it BUT a lien is different than a collection.
This is not true. Once a deliquency hits your report, the damage is already done. A paid/unpaid collection, a paid/unpaid tax lien, a paid/unpaid judgment, all impact your score the moment it hits, and the damage lessens as it ages. Paying a tax lien will not impact your score in any way shape or form.
Paying off deliquent accounts will never result in a point loss, or a point gain. Only changing this information (ie deleting from your file, recoding something from a neg to a pos) will change your score.
Removing the lien (if its IRS) is fairly easy now, but if its state it really depends on the state.
I paid of a state tax lien last month, and it had no impact on my score (as I expected)
-scott
Veracious,
Thank you for the link, it is informative and helpful.
My LO told me since I have paid the lien it shouldnt hurt my scores. But what your saying rckstrscott is if I have the state remove the negative (ie lien) from my CR my scores should go up? correct?
@K_J wrote:My LO told me since I have paid the lien it shouldnt hurt my scores. But what your saying rckstrscott is if I have the state remove the negative (ie lien) from my CR my scores should go up? correct?
Hands down it will go up, probably by at least 20 points, if you remove a tax lien.
-scott