Paying off a closed cc

Anonymous · ‎11-05-2014

Is it wise to pay off a closed cc and hope for an increase of my credit score? I've been struggling with finding the answer to this question! I've paid off a few accounts in collections and have less than 6 to go. Has anyone been in this situation and improved their score??? Someone please help!!!

ravaage · ‎11-05-2014

I am pretty sure it will not affect your credit score, however it will look better on your credit report during a manual review.

Can someone please confrim this?

Current FICOs: (10-27-14) EQ- 655 / EX- 659 / TU- 653

Chase Sapphire Preferred $5,000 / CapitalOne Quicksilver $3,000 / Barclaycard Rewards $2,500 / Barclaycard Apple $1,200 / CapitalOne Platinum $750 / Macy's $600 / Chase Freedom $500

In the garden as of 11/04/2014

Anonymous · ‎11-05-2014

Thank you, what are your suggestions for attempting to raise your socre?

Anonymous · ‎11-05-2014

Generally paying a closed account will cause you to take an initial hit on your score but it eventually rebounds. You may want to try PFD if possible. I would also suggest posting up your accounts you currently have, good and bad, minus any personal info of course. There are a lot of people on here that can give great suggestions. good luck.

Anonymous · ‎11-05-2014

Thanks again! I will try this!

Anonymous · ‎11-05-2014

A closed CC account balance goes against your UTI%. So yes, paying it off *should* increase your score. However when paying something, its best to try to negotiate a PFD (pay for deletion). That will remove other associated derogs - late payments, CO, etc.

Anonymous · ‎11-05-2014

It's from NFCU, I asked them once and they told me no b/c it was my fault that it was late. I think it was b/c i wanted to make payment arrangemets and not the full amount due.

MarineVietVet · ‎11-05-2014

@Anonymous wrote:
Is it wise to pay off a closed cc and hope for an increase of my credit score? I've been struggling with finding the answer to this question! I've paid off a few accounts in collections and have less than 6 to go. Has anyone been in this situation and improved their score??? Someone please help!!!

How is the CC reporting?

- If a closed CC account with a balance continues to report the original credit limit, then both the balance and the CL of the closed account will be used in the utilization calculations.

- If a closed CC account is reporting a zero CL, even if there is a balance on the CC, the card will not be included in the calculations.

- If a closed CC account is reporting a non-zero CL but has a zero balance, the card will not be included in the calculations.

- If a closed account reports a CL that is equal to the balance (balance chasing), then this will be included in the calculations. This is the worst-case scenario with regard to utilization.

Read more here about Closing Credit Cards.

Anonymous · ‎11-05-2014

Hi! It is reporting as a month to month balance (if that makes sense). I owe $557 and it says closed by grantor and every month it says the same amount and has been marked as late. I will pay it off and hope that they remove it from my report, but i highly doubt that part.