When does a settled account fall off?

[DrJim]

I was under the impression that a "settled for less than full amount" would fall off no later than 7.5 years after DOFD.  But I read on another forum that it is 7.5 years after the last payment.

We had an account that my wife lost track of when I left for Iraq and she moved.  After I came back they called her about it.  She asked how much we owed, they gave a figure, she paid it, and it turned out to be $500 or so less than what we actually owed.  So they took the money and dinged my CR.  I have offered time and time again to pay what is owed (PFD) but they refuse.  I even got a letter saying "we cannot report to the CRA "paid what wife was told"  how unprofessional!

So, is it falling off next month (7.5 years after DOFD) or in September 2015 (7.5 years after last payment)?

[guiness56]

It is 7.5 years from the DoFD.   Nothing changes that.

Question - were you deployed to Iraq a reservist or guardsman?

[DrJim]

Reservist.  You thinking Servicemembers Civil Relief Act?

[guiness56]

Yep - retired military.

[DrJim]

Thanks Guiness, and thanks for your service.  Not looking for any new credit anytime soon, this is just my only baddie and I would like to see it gone.  Thanks to the VA I bought my wife the home of her dreams last June.  No need for any credit card or CLI, no need for a car loan; just want a clean slate.

If it doesnt drop off next month I will follow up, including gov't agencies and all.  Thanks for your response.

Kinda miss the simplicity of the war zone, the esprit de corps, the whole thing.  Still in uniform every week, but miss doing it full time and in theater.

[guiness56]

Well, you can invoke the SCRA if it was a debt before you deployed.  They can only charge a total of 6% for interest, late fees, etc.  It may be worth looking into.

Thank you for yours.  Yes, as much as I couldn't wait to retire, I miss it.  25 years of my life spent in the military.

[RobertEG]

FCRA 605(a)(4) bars the consumer reporting agency from issuing any credit report containing any information relating to a collection on an account after expiration of the credit report exclusion period, defined in section 605(c) as 7 years plus 180 days from the DOFD on the OC account.

The information you read about date from payment is simply incorrect.  That is the old, old interpretation of the FCRA that was widespread prior to its revision in 1998 by the addition of clarifying section 605(c).