04-18-2014 01:44 PM
I recently disputed an account that appeared in collections as charged off that was showing a balance. I received an update on my report and now it is not showing as a collections account but a regular account that is closed with a 0 balance that was purchased by another lender. Will this impact my credit score? It is not current, and the closed date was in 2012. I was just curious of this being a closed account with a 0 balance and purchased by another lender is better than it being a collections account that was charged off with a $390 balance. Also if it would impact my credit store. Please advise, and info would be appreciated.
04-18-2014 05:11 PM
Was the dispute directed at the reporting by the OC, or of the reporting by the debt collector?
While the collection was still reporting, the reference to a charge-off was almost certainly reference to the OC having taken that action, and thus was representing the status of the OC account for which they were collecting.
Thus, if the collection has now been deleted, the showing of a prior CO would not be present in the file unless it was also reported by the OC.
The OC did not report having taken a charge-off?
The reporting of a CO is a serious derog, in that it represents a statement that you are expected to stiff the debt. Highly unfavorable in both scoring and a manual review o your CR.
However, with or without reference to a charge-off, once a collection is reported, it becomes its own major derog.
The scoring difference between having only one or the other reporting vs having both reporting is not something I have seen specifically discussed by Fair Isaac.
Whether they are scored separately and their impact added or whether their combined effect is about the same is unanswered, at least to my knowledge.
More significant to a potential creditor may be the status of the debt as unpaid, regardless of score impact.
04-18-2014 06:37 PM
Robert, thanks for the response.
The debt was with the original creditor. I disputed because it was reporting as a CO under the collections column of my report with a $390 balance. I disputed because I payed a CA for the same debt already and they removed their CA line from my report. (PFD) The report was then updated to show that the original creditor was a closed account, with a 0 balance and showing 'purchased by another lender'. I was just wondering if this would bring my score down any with it being a closed account now.
04-18-2014 08:01 PM
nope fico sees it the same so score shouldnt go down.
04-18-2014 08:37 PM
Now that it's paid, I'd send a GW to the OP.