Lates/Collections and their effects over time

[CS800]

NOt sure if this has been discussed before but I have read a lot that with time the effect of lates fade away. But collection affect your score until they are removed or untill they pass the 7.5 year mark.

But I have also read that collections effect fade with time.

Can someone debunk the mystery behind the effect of those two as years go by? Maybe that's the secret formula no on knows about.

For me I have a collection that's due to get off my report on Dec 2012. That's the only collection i have left. At least my CR's states 'Scheduled to stay on the report until Dec 2012' . I really dont even want to touch if for fear of updating the SOL. But at this point, what effect is it having on my score if any?

[llecs]

If a CA hits 7.5 years, it is removed anyway. The damage fades over time as mentioned, but I've seen some examples on here of folks gaining 50-70+ when their last CA is removed due to CRTP. Maybe they took a 100+ point hit in the beginning and gained back some points over time.

It's certainly a YMMV too. There's no way to quantify it without knowing the formula. If you have two people w/ their last CA hitting and deleting at 7-7.5 yrs, one can easily gain 20 and the other 70. It all depends on their scoring bucket, how it reports, when it last updated, and so on. Likewise, someone with 20 CAs reporting and one falls off due to CRTP, then they might not see any gain. There are many, many variables outside the collection itself that can impact the points gained as it falls off.

SOL is the time frame a creditor has to sue. If you have the $$$ set aside to PIF, then go fo it if you are still inside SOL (which ranges anywhere from 3-15 yrs depending on the debt type and state). And there are only a couple of things than can restart the SOL like making a written promise to pay, acknowledging the debt, etc. The DV and PFD examples in here (well, most of them) are safe from restarting the SOL. I've gone after all of my debts while inside SOL. None tried to sue, though collections increased. Most of them naturally fell off at the 7-7.5 yr CRTP.

[CS800]

I'm in MA, how can i find the SOL? My CR's say the this collection will stay on my report until Dec 2012 ( i believe that's the CRTP). This collection is also only on my EX credit report.

Seems like it's only been 6 years since the account was opened in Jan 2006.

This collection reports as follows and it's confusing since there are two charged off dates:

Date Opened:
01/2006

Reported Since:
01/2006

Status Details:  This account is scheduled to continue on record until Dec 2012.
This item was verified on Mar 2008 and remained unchanged.

Account History:
Charge Off as of May 2008, May 2006
60 days past due as of Apr 2006
30 days past due as of Mar 2006

[llecs]

If it is scheduled to stay on until 12/2012, then EX is reading your DOFD to be about 12/2005. Based on the account history, the first 30 day late was 3/2006 which would place that DOFD at that time. So, I'd assume your DOFD is around 3/006 (since it is newer) to be safe. Now SOL can restart in some situations. Did you ever pay on it after 3/2006? Did you ever make a written promise to pay after 3/2006? Did you ever acknowledge the debt in writing after 3/2006? You'd have to look up your state's laws, but in some states, doing any of the above can reset SOL. If none applies, then it is safe to assume that you are 5 years and two months into your SOL for this debt.

http://www.bankrate.com/finance/credit-cards/state-statutes-of-limitations-for-old-debts-2.aspx

The link above lists SOLs by state. Now state laws change all the time and I had found errors in their chart in the past. It says, for MA, that the SOL for all debt types is 6 years. Looks like you have 10 months to go. If you don't have the $$$ set aside to PIF if you had to to avoid a judgment, then I'd wait 10 months. However, I'd save anyway just in case they appeared out of the blue. I'd also verify by reading into your state's laws:

http://www.malegislature.gov/Laws/GeneralLaws/PartI/TitleXV/Chapter106

They jumbled it all up and each debt type is split up in various places, but they can all be found in Chp. 106. I glanced at written and open (e.g. CCs) and saw it as 6 yrs.

The "charged-off" date is meaningless per repair. It's their own internal comment.

[CS800]

I was making some payments to it until end of 2008 but then since I was had to deal with some family hardship, i stopped paying.

In the MA Law about collection I saw this section:

Statute of Limitations:

Section 4-111. An action to enforce an obligation, duty, or right arising under this Article must be commenced within three years after the cause of action accrues.

http://www.malegislature.gov/Laws/GeneralLaws/PartIII/TitleV/Chapter260/Section2

It states within 6 years. So since I made some payments until late 2008, where does that leave me?

Status: 

Account charged off. $4,851 written off. $2,691 past due as of May 2008.

Account History:
Charge Off as of May 2008, May 2006
60 days past due as of Apr 2006
30 days past due as of Mar 2006

How can I have two charged offs? This info is directly from my EX CR

[CS800]

llecs:

To answer your questions:

Did you ever pay on it after 3/2006?

Yes I paid for about 14 months up till late 2008

Did you ever make a written promise to pay after 3/2006?

No

Did you ever acknowledge the debt in writing after 3/2006?

As in making payments? Yes

As in signing anything on paper = No 

[CS800]

I also found this info dated May 2011:

Does a partial payment restart the SOL?

Depending on what state you live in, if you make a partial payment, you could be postponing the Statute of Limitations' taking effect on your collection account or charge-off. A collector might call you one day and say you waived your rights when you made a deal with the collection agency. Do not take anything a collector tells you for granted. Make them prove it to you, in or out of court. For about half the population, the Statute of Limitations started ticking the day they made the last payment for their account.

Some states have laws which specify that a partial payment does not restart the clock on the SOL, unless there is a new written promise to pay. What that means is that you actually write out a new agreement with the orginal creditor and/or collection agency. If you live in one of these states, simply sending in a check doesn't restart the clock. The statute of limitations is only extended by new written promise to pay in these states:

Arizona, California, Florida, Iowa, Kansas, Maine, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New York, Texas, Virginia, West Virgina, Wisconsin.