what to do?

[Anonymous]

I was just wondering if I should mess with some charge offs and collection accounts that I have. They are all 2 or 3 years old and I have a car loan and student loans that are current. I have a TU score of 565 and an looking to raise my score enough to buy a house within the next 1 or 2 years. I do not have any open credit card accounts. should I pay the collections and charge offs or just wait until they fall off? If they are unpaid can they be placed on my report again after they come off?

[LIGHTNIN]

On unpaid debts the OC's and CA's can try to collect on these debt forever, even after they are no longer reporting on your CR's.

As long as you have the funds, I would suggest using PFD letters. When obtaining a mortgage they like your debts to be paid.

It will make you feel better too, knowing all your debts are paid.

No longer looking over your shoulder and listening to the phone forever ringing.

Think about it, wouldn't it be better to have these debts paid for and behind you, when you are enjoying your new home.

[RobertEG]

The uncertainty of the effects of unpaid debt on your future ability to secure new credit is particularly relevant if you are planning to apply for a large principal chunk of credit, such as a mortgage. 

The CR deletion dates under FCRA 605(a), such as 7 years plus 180-days from DOFD for a charge-off or collection, are not absolute.  FCRA 605(b) provides a total exemption of these CR exclusion periods for any creditor who requests your CR and their inquiry pertains to your application for credit in an amount of $150,000 or more.  In such cases, they can request and receive a complete credit report that includes those otherwise excluded items. 

They might not request such an extended CR, but be mindful that they have the authority to do so.  If they do, the old derogs and delinquencies on any account in your credit file will be available to them.  Many mortgage lendors will require the payment of any delinquent debt that they are aware of as a condition for mortgage approval.  You never know.

[Anonymous]

Thanks, I am planning on paying them, I just didn't know if paying them now would make them stay on my report longer. I was also wondering about a repo we had in 2009. GMAC shows balance as 0. I have received letters from collection agency about making a payment plan for the remainder after the sale of the truck. I still owe 14,000. The collection agency is not reporting on my reports. I just wasn't sure if I should make payments or try to save the whole amount and pay off at once. will it make a difference?

[LIGHTNIN]

Since the OC is reporting a $0 balance,looks like the debt was sold to the CA.

The OC is out of the picture now, so you will have to deal with the CA.

Know your States SOL...Thats the time period they can sue and win.Each state is different.

The way you pay is up to you,but just to let you know, my not making payments the CA may send a summons to court for a judgment.IME, I called the CA phone # that was on the summons,sent a PFD letter over night settling for less then the full amount and paid before the court date.The CA agreed to cancel the court date, also agreed to delete from my CR. Hope this info helps.

After proof reading this post, I thought I would add more about the judgment.It was for DH CC the CA was asking for more then double,DH did pay the amount he charged on the CC but minus the late fees, interest etc. I guess we were lucky.

[Anonymous]

Thanks! I guess I will contact them and do a payment plan before they sue me.