Just received Credit Report from TU. How should I approach these NEW collections?

[Anonymous]

I recently ordered a free credit report after being denied an increase on one of my credit cards. Even though I already knew about some negative information on my report, as expected, there were new adverse items on my updated credit report from TU. I currently have a collection from my local medical department for an ambulance trip I took 5 years ago. The TU report says it is set to fall off my report December of 2011. The total unpaid balance is $87. Do I pay it or let it ride until December? If I let it ride, will the EMS(Ambulance) renew it? I heard paying it can be bad because it reinstates another 7 years. The other new collection is for an old bank account that was overdrawn and I never paid it off. I had owed Bank of America $131 during a tight financial pitch and I let it close and switched to a new bank and new checking account. That is in collections and they are will to settle with payment arrangements or a total payoff, however, the agency is some place I have never heard of called NCO Financial Systems, INC. They claim you can pay the balance off on their website. What do I do? Do I pay them or pay BOA? If I pay BOA will they notify the credit bureaus? Thanks for any and all help. I know more than most about credit for my age(mid 20's), but want the proper actions here so that it betters my credit report. Thanks so much!

[RobertEG]

Anyone who tells you that anythying a debt collector does or reports can delay or reset the continued inclusion of a CA in your credit report simply does not know the law that has evolved since 1998.

That is the precise issue that resulted in Congress amending the FCRA back in 1998 by the addition of section 605(c).

That section of statute explicitly sets one, single, date-certain for the continued inclusion in your CR of any CO or CA.

It is simple.  You have a date of first delinquency DOFD) with the original creditor under your OC account.  That date has nothing to do with anythihng reported by the debt collector under their CA account with the CRA.  From that date-certain DOFD, you just add 180-days, and then 7 years.  That is the date of required exclusion of any CO or CA reported on that debt.  Period.

Dont ever rely on "estimated drop off dates" spurioulsy included in any credit report you receive.  Those are NOT dates reported by anyone.  They are only CRA estimates.  Rely only on the DOFD on the OC account, plus 180-days, plus 7 years.

Whether or not to pay an old debt is totally separate issue.  First of all, it is against the terms of agreement of this site to ever advise someone not to pay a legitimate debt.

So I restrict my comments only to potential repercussions if you dont.

If contemplating a "wait it out for CR deletion" strategy, the very first thing you need to consider is your state statute of limitations on the debt.

Expiration of your SOL never eliminates the debt, but it does provide you with affirmative defense in court should they bring legal action.

If you are still within SOL, threat of legal action remains.  If the SOL has expired, then you have no remaing threat of a court judgment being obtaines.

Payment will never,in and of itself, improve your FICO score.  Payment never mandates any removal of prior reported delinquencies, unless you obtain a prior PFD agreement.

It does not matter, if you just PIF, whether you pay the OC or CA.  No CR deletion by either is required.  Just an update of status to paid.

If the OC still owns the debt, you can offer a PFD to either the OC or CA.  IF offered and accepted by one, they can only agree to deletion of their own reporting, and not to any deletion by the other.

[MarineVietVet]

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@RobertEG wrote:

Anyone who tells you that anythying a debt collector does or reports can delay or reset the continued inclusion of a CA in your credit report simply does not know the law that has evolved since 1998.

That is the precise issue that resulted in Congress amending the FCRA back in 1998 by the addition of section 605(c).

That section of statute explicitly sets one, single, date-certain for the continued inclusion in your CR of any CO or CA.

It is simple.  You have a date of first delinquency DOFD) with the original creditor under your OC account.  That date has nothing to do with anythihng reported by the debt collector under their CA account with the CRA.  From that date-certain DOFD, you just add 180-days, and then 7 years.  That is the date of required exclusion of any CO or CA reported on that debt.  Period.

Dont ever rely on "estimated drop off dates" spurioulsy included in any credit report you receive.  Those are NOT dates reported by anyone.  They are only CRA estimates.  Rely only on the DOFD on the OC account, plus 180-days, plus 7 years.

Whether or not to pay an old debt is totally separate issue.  First of all, it is against the terms of agreement of this site to ever advise someone not to pay a legitimate debt.

So I restrict my comments only to potential repercussions if you dont.

If contemplating a "wait it out for CR deletion" strategy, the very first thing you need to consider is your state statute of limitations on the debt.

Expiration of your SOL never eliminates the debt, but it does provide you with affirmative defense in court should they bring legal action.

If you are still within SOL, threat of legal action remains.  If the SOL has expired, then you have no remaing threat of a court judgment being obtaines.

Payment will never,in and of itself, improve your FICO score.  Payment never mandates any removal of prior reported delinquencies, unless you obtain a prior PFD agreement.

It does not matter, if you just PIF, whether you pay the OC or CA.  No CR deletion by either is required.  Just an update of status to paid.

If the OC still owns the debt, you can offer a PFD to either the OC or CA.  IF offered and accepted by one, they can only agree to deletion of their own reporting, and not to any deletion by the other.

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I know this is about collections and it's true that simply paying a collection will not improve your score but there is an exception to this in regards to other derogatories. If a credit card is CO'ed with a balance and you pay it off your utilization should go down if everything else is the same and that will help your score. I just wanted to add that to anyone reading this thread.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 10/10-813, TU - 10/10-774

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".