What "closed" on collection means?

[trc1962]

I am attacking the last 3 collections on my transunion report and all 3 have a balance, though two say "closed" and one is "open." What does that mean? Thanks

[RobertEG]

Open, when used under a collection, refers to the date they received their collection authority, and thus opened their collection activities.

It has nothing to do with the Open date of the OC account.

Closed, when related to a collection, is the date they report as termination of their collection authority.

Collection authority can be terminated in one of three ways. 

The debt could be paid, the current owner could have terminated their assignment of authority to collect on their behalf, or if the debt collector was the owner, they sold the debt.

[trc1962]

"closed" means the company is no longer collecting on the debt which has a balance? How does one handle a closed versus open collection account? Thanks

[RobertEG]

The balance reported by a debt collector references the amount they are authori\ed to attempt collection.

If their collection authority is terminated, they should also update the balance under their collection to $0.

Debt collector reporting of $0 thus does not necessarily signify satisfaction of the debt.  It signifies that they no longer have an amount they are authorized to attempt collection upon.  If the $0 balance resulted from payment of the debt, there would be additional reporting of paid.

Closed, $0 means only that they are no longer collecting.

Closed, paid, $0 means the debt is satisfied.

How you handle a closed collection thus depends upon whether the debt is satisfied.

If the debt has not been paid, then one would most likely be looking for a new debt collector lurking below the surface.  If you can determine who they are before they report, you can send them a DV and thus prevent reporting until they first provide validation of the debt.

[trc1962]

So, if a collection report is listed as "closed" as opposed to "open" and has a balance, then the CA has sold the debt and is no longer collecting on it?

[RobertEG]

No, it would mean their reporting is inaccurate, and needs updating.

Closed means they no longer have collection authority, and thus $0 under their collection.