Reply
New Visitor
sushilove
Posts: 2
Registered: ‎02-05-2013
0

Credit Cards- Paying off old delinquent credit cards

Hello

 

My credit score is 586.  I have two delinquent credit cards that went to collections. I wanted to pay that off as well as my current GOOD STANDING auto loan next month when I get my tax refund. 

 

Does paying off old -debt credit cards actually help? If so how long after i pay those off and pay off my auto loan will I see an increase in my credit score? Thank you

Moderator Emeritus
llecs
Posts: 32,881
Registered: ‎08-04-2007
0

Re: Credit Cards- Paying off old delinquent credit cards

Paying any collection won't help your FICO. However, for some, if the charged-off CC still reports a balance and a CL and is updating regularly, and the utilization from that charged-off CC is hurting their overall util, then paying that bad CC can potentially improve your score.

 

For the car loan, do you have any other open loans reporting? If so, you probably won't see any score change when paid off. There might be a slight chance of an increase if most of your accounts are reporting a balance. FICO likes to see most of your accounts at $0.


myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+
}