Epic Contributor
Posts: 20,308
Registered: ‎03-19-2007
Re: Paying off old collections

Once paid, no, the reporting will not automatically be deleted.

In fact, CRA policy is that furnishers should not report deletion of prior account derogs based on ultimate payment of the debt.

Payment is unrelated to the occurence of the derog itself, and their policy is that the reporting should remain as an accurate record of the consumer's credit history.

 

However, furnishers may report deletion, notwithstanding CRA policy, if they so choose.  When reporting, they need provide no reason, and thus it is not questioned by the CRAs.  Some furnishers strictly abide by CRA policy, while others will grant exceptions.  You need to ask, either before payment via a PFD offer, or after paying via a good will request.

 

Making payments on a debt will never reset any of the credit report exclusion periods for derogs, which are based under FCRA 605(a) on their dates of occurence (except for tax liens, which are based on their date of payment).

A collection becomes excluded based solely on the DOFD on the OC account plus 7 years plus 180 days.  Period.

 

Paying on a debt will not necessarily reset the statute of limitations for them to bring legal action.  Some states provide for a reset based on payments or firm offers to pay, while others do not.  You need to research the provisions of your specific state SOL statute for debt.