For my efforts in cleaning up my credit, I found starting on a credit card first was very helpful. I didn't know about the boards or even how FICO worked, just figured I'd get a cc to establish good history. What it also ended up doing was establishing recent history. After my first small cc was seven months old, I found these boards and started cleaning up my credit- GW's, PFD's, disputes for not mine stuff, etc. Having the two things work at the same time has thrown my score around quite a bit, but when all is said and done, hopefully by the fall here, what bad stuff may still be on my report will be aged considerably, and my recent on time payments will have aged in a good way.
I know I need to be more patient, but it does help in my scenario to have two things going at once.
I agree with marinevietvet; almost all those baddies will be gone off the report forever in a year or so. There were some big balances there, and any activity you may start on one may wake the whole lot of them up. One idea is to wait till they fall off your report- they can never return, and pay them off after they are off the reports. That way you feel better about paying off a creditor, in full or whatever, and they can't hurt you. I am going to do that on a couple of mine. If they aren't hounding, then to me it's safer to avoid the possible SOL reset, possible judgements, possible whatever they want to try and just pay them off after they are off the reports.
Best of luck!
EQ. Starting Score 08/19/12: 545
@RobertEG wrote:We are talking about multiple accounts, with a combined $20,000 in unpaid debt, and the effects on potential future action both by the creditor, and in FICO scoring.
Legal action looms....
If not paying is even an option under consideration, my FIRST step would be to know my state statute of limitations on debt before doing anything else. If they sue, do you have a detense.
First, know what date under your state SOL statute triggers the initial setting of running of your state SOL. In most states, it is the date of first "cause of action," which is the first date you went delinquent on OC account terms, and thus provided them the first opportunity to seek legal recovery. This is almost always the same as the DOFD on the OC account. But some states provide for reset of the running of the SOL based on prior payments of the debt, some on just offers to pay, and others on date of last activity on the account. That date is critical
Once you know the effective date of commencement of your state SOL statute, you have to then know the term of SOL period for your state, then add that to the SOL commencement date, to arrive at the SOL expiration date. Most state SOL statutes set expiration from 3-7 years from the efffective date.
Dont EVER rely on projected drop off dates provided in any credit report as the date for running, or termination, or SOL. They are totally unrelated.
Why am I going through all of this SOL stuff when you are asking about credit reporting? Simply because CRA drop off dates have nothing to do with their ability to sue at any time, and SOL expiration is only relevant, should they bring legal action, as your legal defense, during trial. It is not a bar to them bringing legal action.
Now, shifting to credit reporting. Focus first on the OC account records, and clearly deterimine the DOFD on each OC account, and the date of each subsequent deliiquency. OC account records determine FICO scoring. The set the date of DOFD on each OC and CA account, which sets the 7 1/2 year "falloff" date set forth in FCRA 605(c).
Contrary to what has been posted, there is NO absolute drop off of prior derogs from ones CR.
FCRA 605(a) sets various NORMAL dates after which a prior drog in a CR can no longer be included in a CR issued by a CRA. But this does not requrie deletion of the derog from your credit file. FCRA 605(b) provides for a total exemption from all of the "drop off dates" restirctions specified in FCRA 605(a) in the event of any future application for insurance or credit that involves a principal amount of $150,000 or more. Not gone, if requeste by a high-principal request for credit, such as a mortgage loan.
Which state? State you live in now or state in which the account was first opened ?