Understanding FICO® Scoring

[FICOnater2007]

Ricdiablo,

Congratulations and thanks for posting all of the useful info.

You da man!

FICOnater2007

[ricdiablo]

LOL. Thanks

[Luna4]

Hello,

I read that deliquencies or charge offs are not removed from your credit score for 7 years. 7 years as of when? Date account was charged off or sold to collections agency? or from date account was first opened?

I paid off a derogatory account 03/07 through collections agency, when I requested my credit score, CC read charged-off as of 2006. How long before it is removed from my report, I first opened the account in 2000?

My credit score has been increasing slowly.

Thanks.

[ricdiablo]

7 years from the final date of the delinquency event.

So if the charge off date was March of 2006 (or a collection was reported as March 2006), it will remain on your report through February of 2013 regardless of when the account was opened, and regardless of whether you pay off the debt in 2007,2008,....

Even if you decide not to pay the debt back at all--like never--that delinquency will fall off after 7 years. However, your score will be in the toilet for 7 years.

It's to your benefit to pay off the debt when you can, because (as you already noticed) your credit score goes up almost immediately when a collection or charge-off debt is settled. From personal experience it's not like my credit score went up when I paid the charge-offs, more like the "penalty points" were taken away. As long as anyone has unpaid/ unresolved delinquencies, his or her score will always be extremely low. After those collections and charge-offs are paid up though, it's like your score returns to the land of the living again. It stays low, just not "Guiness Book" low.

Good work in paying off the charge-off!

[myhearts07]

Ric,

Great story and thanks for sharing.  Keep inspiring us.. 

[MidnightVoice]

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ricdiablo wrote:
7 years from the final date of the delinquency event.

So if the charge off date was March of 2006 (or a collection was reported as March 2006), it will remain on your report through February of 2013 regardless of when the account was opened, and regardless of whether you pay off the debt in 2007,2008,....

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Isn't it 7 to 7.5 years from the DOFD?

[ricdiablo]

I would definitely contact the credit reporting agency on the 1st month after the 7th year to remove it--why wait? As far as I know, 7 years is the limit for collections, late pays, charge offs, and the like. Bankruptcy is the only thing I remember that stays on more than 7 years (usually 10 years, but is sometimes removed sooner).

[Tuscani]

http://ficoforums.myfico.com/fico/board/message?board.id=generalcredit&thread.id=2689

http://ficoforums.myfico.com/fico/board/message?board.id=generalcredit&thread.id=8713