10 Year Old Debt

[Anonymous]

Yes I am referring to the credit reporting time period. My source of information comes from Clark Howard.

[Anonymous]

I think that change scoring to ingoing debts under $100

[drkaje]

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@basseterre wrote:

Ok, since I'm new here, I'll ask the dumb question;  Why not just pay the old and relatively small debt in full?  I understand that there is no legal obligation and that the money would be going to a collection agency rather than the original service provider.  But a clear conscience might mean something to some people.  So I guess the adjunct to my original question is, would it be more trouble than it's worth to just pay it off?  Could paying the old debt in any way show up on a credit report and negatively affect someone, for example, applying for a mortgage?  Could it also be an invitation to an unscrupulous collection agency to pursue additional shenanigans against an honest (but somewhat foolish) person?

Thanks for any insights.

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I think people can rationalize pretty much anything.

[clumsymoon]

If it is not showing up on your credit report, I would ignore it. If it does show up on your report, you can just dispute it through the credit report companies. I heard that for a mortgage loan, many mortgage loan companies want any open collections taken care of, no matter how old. I don't remember where I heard that though so that could be false. Also not sure if they could have access to anything older than what is on your report now.

[Anonymous]

That's incorrect.

If you make a payment, they can report as paid greater than 90 days late.

The DOFD refers to the first default that has not been cured.

Anytime you are even one day late in a payment, that is technically a payment in default. Cure the default, and the 7.5 year clock starts re-ticking.

Paying on an account that has fallen off your CRs is a way to bring the scores down.

Just as importantly, it is a way to reset the SOL clock. 

You need to check the wording of your state law to determine if a verbal acknowledgement of the debt resets SOL. I'm unaware of any state where it does, but there are states that are a little squishy in their definitions. On the other hand, there are two states, WI and, I believe, MS, where even trying to collect on an out of SOL debt is illegal. The laws there say that the debt is extinguished on the day it falls out of SOL. 

If you want them to stop contacting you, then send them a debt verification letter, simply stating that the debt is in dispute, that all phone calls are inconvenient (that's the wording in the FDCPA to get calls stopped) and that you believe that SOL in your state is X years from the last payment. 

Bottom line, even if you believe that you owe the debt, you probably don't owe it to whatever entity is trying to collect, because they don't have the legal right to collect: they don't have the documentation to show it.

If you feel guilty about the money, find a charity that you support, and give it to them. I promise that they can use it more than a national collection agency.

[pizzadude]

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@Anonymous wrote:

That's incorrect.

If you make a payment, they can report as paid greater than 90 days late.

The DOFD refers to the first default that has not been cured.

Anytime you are even one day late in a payment, that is technically a payment in default. Cure the default, and the 7.5 year clock starts re-ticking.

Paying on an account that has fallen off your CRs is a way to bring the scores down.

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This only applies to original creditor ( OC ) accounts that haven't been charged off and sent to collections.    Almost all creditors charge~off bad debt after 90 or 120 days, and once they do that the DOFD is established and can't be changed.    The DOFD is what determines the credit reporting time period for Collections.

[prm300]

I have had both of these scenarios occur on the same debt. 

My OC had a DOFD of somewhere in 2002 on my reports even though I was making small payments.  This was due to my being in a consolidation plan.  The account was never brought back to "current" or, as stated, "has not been cured" after I made late payments.   In 2006, after I stopped paying all together, the debt was officially sent to a CA for collection.  The CA was then on the reports as well as the OC for the same debt.  In 2009 the original debt fell off my reports.  The CA remains and lists a DOFD of 8/2006 even after my disputing the date.

I'm having a hard time proving that the real DOFD was in 2002 since the OC will not verify anything for me because they are not on the reports.

I could use some advice.

By the way, the SOL is 4 yrs.

Thanks