Letting a Collection Account run its course

[CluelessJohn]

A baddie hit my CRs last month.  Listed as an open collection with the remark "placed for collection".  Reported by the collection agency and not the original creditor.  I "always" pay my debts but not this one for reasons I wont go go into, but I will say its heallthcare/medical related.  My plan is to ride it out for the 7 years it will be on my CRs.  My FICO took a 100pt hit (TU from Discover and Citi CCs) and Vantage 3.0 from Credit Karma took a much lesser hit.  My only need for additional debt would be auto related in a 2 or 3 year time frame.

My strategy is predicated upon this collection will go away after 7 years and that my FICO score will gradually recover during thise 7 years as the original reporting ages.  Are those valid assumptions?  Is there anything that can happen (not of my doing) that restarts the 7 year clock?  I don't think the amount is big enough for a CA to chase.

Thanks.

[Anonymous]

Yes, your score will recover some over the years, but not fully as it will still be on your record.  Also, you could be sued any time within the SOL.  If its not big enough that you are concerned about the CA chasing, why wouldn't you do a DV/PFD and not have to worry about all of this? 

[Rebuilding69]

I could be wrong, but I believe the only thing that can restart the clock is entering an agreement to make payments, then reniging on the payments?

[Anonymous]

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@Rebuilding69 wrote:
I could be wrong, but I believe the only thing that can restart the clock is entering an agreement to make payments, then reniging on the payments?

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That only restarts SOL, for which you can be sued. The 7 year reporting clock cannot be restarted legally.

[Anonymous]

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@cluessJohn wrote:

A baddie hit my CRs last month.  Listed as an open collection with the remark "placed for collection".  Reported by the collection agency and not the original creditor.  I "always" pay my debts but not this one for reasons I wont go go into, but I will say its heallthcare/medical related.  My plan is to ride it out for the 7 years it will be on my CRs.  My FICO took a 100pt hit (TU from Discover and Citi CCs) and Vantage 3.0 from Credit Karma took a much lesser hit.  My only need for additional debt would be auto related in a 2 or 3 year time frame.

My strategy is predicated upon this collection will go away after 7 years and that my FICO score will gradually recover during thise 7 years as the original reporting ages.  Are those valid assumptions?  Is there anything that can happen (not of my doing) that restarts the 7 year clock?  I don't think the amount is big enough for a CA to chase.

Thanks.

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I would be careful with that assumption, unless its a very small amount.

[CluelessJohn]

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@Anonymous wrote:

Yes, your score will recover some over the years, but not fully as it will still be on your record.  Also, you could be sued any time within the SOL.  If its not big enough that you are concerned about the CA chasing, why wouldn't you do a DV/PFD and not have to worry about all of this? 

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I'm not really worrying about it; just trying to confirm with folks with more knowledge than myself that my "do nothing" strategy doesn't have obvious flaws.

The number is big enough to me, but not big enough for a CA to spend effort on (in my opinion).

[Anonymous]

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@cluessJohn wrote:

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@Anonymous wrote:

Yes, your score will recover some over the years, but not fully as it will still be on your record.  Also, you could be sued any time within the SOL.  If its not big enough that you are concerned about the CA chasing, why wouldn't you do a DV/PFD and not have to worry about all of this? 

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I'm not really worrying about it; just trying to confirm with folks with more knowledge than myself that my "do nothing" strategy doesn't have obvious flaws.

The number is big enough to me, but not big enough for a CA to spend effort on (in my opinion).

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Well, like I said, I would be careful with that assumption. I was sued by a CA last year for a medical debt that was a little over $500.

[CluelessJohn]

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@Anonymous wrote:

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@cluessJohn wrote:

My strategy is predicated upon this collection will go away after 7 years and that my FICO score will gradually recover during thise 7 years as the original reporting ages.  Are those valid assumptions?  Is there anything that can happen (not of my doing) that restarts the 7 year clock?  I don't think the amount is big enough for a CA to chase.

Thanks.

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I would be careful with that assumption, unless its a very small amount.

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Yes, I appreciate that could be a wild card.

[Anonymous]

just keep in mind that this could effect your interest rate on a loan and depending on the numbers could cost a few thousand extra over the term.

[2b2rich]

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@CluelessJohn wrote:

A baddie hit my CRs last month.  Listed as an open collection with the remark "placed for collection".  Reported by the collection agency and not the original creditor.  I "always" pay my debts but not this one for reasons I wont go go into, but I will say its heallthcare/medical related.  My plan is to ride it out for the 7 years it will be on my CRs.  My FICO took a 100pt hit (TU from Discover and Citi CCs) and Vantage 3.0 from Credit Karma took a much lesser hit.  My only need for additional debt would be auto related in a 2 or 3 year time frame.

My strategy is predicated upon this collection will go away after 7 years and that my FICO score will gradually recover during thise 7 years as the original reporting ages.  Are those valid assumptions?  Is there anything that can happen (not of my doing) that restarts the 7 year clock?  I don't think the amount is big enough for a CA to chase.

Thanks.

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As others have pointed out, there is always the chance you could be sued.  They usually like to do this right before the SOL runs out so that they can add it to your CR for another 7 years at the start of a judgement's date entered.  So, if for example the SOL in your state is 4 years, this could actually haunt your CR for 11 years +-.

When is the date of service for this?  Usually the 7 year reporting begans the date of service on medical collections.  If it's already in collections, you're probably looking at less than 7.

Is there no insurance involved?  I'm not sure about the details, but pretty soon, medical collections are expected to be removed asap they're paid by insurance, I'm not sure if comsumer payment qualifies, but it will be interesting to see how it works.