Understanding FICO® Scoring

[Drew]

In reviewing my credit report, I found that some of my deliquent accounts say closed and some say open.  What is the difference between the two?

[Brammy]

If it is coded closed it is not considered in the FICO score as an active account though it will still remain on your report for seven years.  When you say delinquent, have the accounts been charged off or sold?  Do they show a balance owing.  IF they have been placed with a collection agency they should read closed or charged off not open if they have their internal collections dept handling it, it may well be an open collections account.

[Drew]

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Brammy wrote:

When you say delinquent, have the accounts been charged off or sold?.

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The accounts were charged off but the account status says open.  I know for a fact that I get calls from third party collection agencies pertaining to those accounts.  Does that mean that technically the original creditor owns the account?  If so, do closed collection accounts mean the collection agencies own the account?

[Brammy]

Which ever is last is the party that owns the ccount.  On occassion a creditor will hire a third party collector and when deemed uncollectable it is returned to the original creditor.  Only one at a time should show open with a balance due.  Find out who actually no owns the collection acocunt and dispute the other open notations as invalid and request they be updated to reflect 0 bal due.  The only reason I recommend this is that all open balances will factor in to your dti ratio when new creditors decide whether or not to extend credit.

We act as if they haven't seen this before, I'm sure credit grantors are used to seeing thissituation.  But with so many approvals automated, its best to have your profile as accurate as possible.

Message Edited by Brammy on 04-01-2007 02:12 PM

[Drew]

I have two accounts on my report for the same creditor but one of the accounts has a transferred status.  Should I beat disputing that as well?

[Brammy]

Does the transferred account show a balance due?  Disputing is a great tool, however, you do take the chance of opening up a new can of worms when you dispute a tradeline.  You may dispute a tradeline with valid info that only appears on one bureau.  As a result of your dispute, the creditor may take the initiative to update information on all three bureaus then you're left with not one bureau showing derog info but all three.

Whether or not it is worth disputing depends on the status.  How close are these to the 7yr mark?  Some dogs are best left sleeping. 

Your dispute may very well let your creditor know that your are still 'alive' and recognize how imprtant your credit is... In these cases you may open up a whole slew of new collection attempts.

Message Edited by Brammy on 04-01-2007 02:26 PM

[Drew]

Oh, all my collection accounts are less than a year old.  That's mainly the reason I'm trying to take of them now because I'm told it will look better to creditors.

There's also no balance on the transferred account.

Message Edited by Drew on 04-01-2007 11:52 AM

[Skiffy]

On Equifax, any delinquent account will always say open, even if it's not. One of their quirks.

[Drew]

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Skiffy wrote:
On Equifax, any delinquent account will always say open, even if it's not. One of their quirks.

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Actually, I saw this information on my Experian report.

[Brammy]

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Skiffy wrote:
On Equifax, any delinquent account will always say open, even if it's not. One of their quirks.

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Not true, I have successfully disputed an account and had it marked closed. Even after the rep stated well we consider it closed.