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Member
juicy1
Posts: 5
Registered: ‎01-24-2008
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Score impact due to CC closure & score change by paying off CAs

[ Edited ]

Hello All,

 

I am new to this forum.  Thank you all for sharing your experiences.  Does anyone know how credit score is affected when a credit card closed by creditor or myself while still paying off  debt?

 

Also how far back should I go  (if at all ) to pay off collection accounts and how would it affect my score?

 

I thank you in advance for your input.

 

OP, I split your post off and created a new one here.

Message Edited by llecs on 11-02-2008 12:31 PM
GiGi
Moderator Emeritus
llecs
Posts: 32,869
Registered: ‎08-04-2007
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Re: Score impact due to CC closure & score change by paying off CAs

Once closed, FICO would continue to read the CL as your continue to pay off the CC. Once you pay off the CC, the CL reverts to $0 along with your balance and it won't be factored into scoring unless it reads negative (e.g. settled for less..., or CO/collection) and it will continue to help your history.

 

If you have any collections (e.g. CAs), paying them off will not help your score at all. Paid or unpaid, the damage to your score is the same.

Valued Contributor
nyccc2
Posts: 1,195
Registered: ‎12-13-2007
0

Re: Score impact due to CC closure & score change by paying off CAs


llecs wrote:

...

 

If you have any collections (e.g. CAs), paying them off will not help your score at all. Paid or unpaid, the damage to your score is the same.


Actually it is worse then that (as I found out the hard way).  Your 6 year old unpaid collection that most likely last reported 6 years ago, will be updated to the date you paid it so you now have a new paid collection, which is WORSE then having an old unpaid collection (for the next few years at least).

 

 I'd recommend;

 

1) Disputing the item if it seems wrong to you (balance, age, etc.) to try to get it off. DO this ONLY if the item is beyond the Statute of Limitations, i.e. the timeframe in which you can *legally* be sued for it.  There is some link on this board that will tell you the SOL for the state you (allegedly) sustained the debt.  If it is not out of SOL, challenging it might/will put you back on the collectors radar, possibly update the report, and likely get you taken to court.

 

2) Read on this board about PFD, or Pay For Delete. Some collection agencies will remove the item in exchange for paying off the debt.  They will ALL tell you they can't, but that is not true.  Some do balk at it, but many will be amenable to some agreement where you pay and they don't reply to your subsequent dispute (which means the item falls of in 30 days).  As you will see when reviewing this topic, you need to get this agreement in WRITING and signed by a representative (preferably the legal counsel) of the company in question.

 

Getting paid or unpaid collections off your report can add 15-50 points to your report.  I'm all for paying them if they are yours, but also feel you shoulnd't be *penalized* point wise for doing so as the current scoring does.

 

Best of luck!

MyFico Scores (TU/Exp/Efx):

11/02/08 696 / 695/ 737- 5/4/08: 667 / 703 / 668 - 11/07 Low 500s All (Fako)
Regular Contributor
morganirish
Posts: 188
Registered: ‎10-15-2008
0

credit score

I am like many people on this web, trying to bring my score up.  When I pull all three, which one do I go by, or is it all three?  They are all in the "bad category", but they are all different. 

TU is 601, Equifax is 628 and experian is 656.

Moderator Emeritus
ByrdMan
Posts: 7,970
Registered: ‎12-19-2007
0

Re: credit score

All three are real FICOs, so they all matter. However, the region of the country in which you live will usually determine which repository will be used most often.

Welcome to the forums and please read credit scoring 101, if you haven't done so already.


morganirish wrote:

I am like many people on this web, trying to bring my score up.  When I pull all three, which one do I go by, or is it all three?  They are all in the "bad category", but they are all different. 

TU is 601, Equifax is 628 and experian is 656.


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