I recently pulled my Experian credit report and was surprised to find two collections items listed. I've figured out what they are though. And the two items are related.
Here is my "woe is me" story, followed by some questions.
I had a Home Depot credit card (through CBNA) with a CL of $5001 that I never used. One day, I bought a $2.55 drawer pull and put it on the card. Because it was such a small item, I forgot that I had charged it and not paid cash. So I ignored the electronic statements I was getting. (Why would I look at a statement for a card I don't use and had a $0 balance? Oops!) Through late charges and interest, that $2.55 became $127 over time. That's one expensive drawer pull! The account went delinquent and was passed to Midland collection agency. Home Depot closed my credit card.
I paid the Midland collections bill about a month or so ago. I'll have to check the exact date the payment posted.
My credit report is currently showing both the original account (the Home Depot card) AND the related Midland collections account:
- The Midland tradeline is listed as a "potentially negative closed", with a balance of $127. It was opened 9/1/2013 and account status is listed as closed.
- The Home Depot/CBNA tradeline is also listed as a "potentially negative closed", account status is closed, payment status is charge off, and comments read, "transferred to another lender or claim purchased."
I'm assuming that the Midland collections tradeline will be removed from my credit report shortly, i.e. the next time they report, and that it is only on my report to begin with because my payment to them was fairly recent. I mean, they're not allowed to report an account with amount owing once it's been paid, right? So I'll be watching for that to come off and look into the proper way to do a dispute if it doesn't come off in a reasonable amount of time.
Now, the original Home Depot card. If the original account is, in the end, paid off through the collections agency, can they still be reporting that? I'm confused by the charge off notation here. I thought a charge off was when a creditor/bill issuer determined they were likely never going to collect on the obligation and were essentially "writing it off" their books (no longer an asset). Since the obligation is actually paid now, do they also have to reverse/delete/remove the charge off from my report? Is there some way, on the up and up, for me to get the item removed from my report? I'm not sure if this is something where "wait and see" is an ok strategy or if I need to take action to get it resolved. Or if my stupid oversight re the original $2.55 charge is a mistake I need to live with.
I'd like to clear my report of these two items since I've resolved the collections item. Any advice on how to correctly do that would be MOST appreciated.
