topic Re: Question for Fico Veterans in Understanding FICO® Scoring

Question for Fico Veterans

sobetrader — Thu, 20 Jan 2011 17:02:24 GMT

Does Fico scoring read "Paid in Full" vs. "Settled" any different?

From my understanding and research I have learned that once a Charge-off is on your credit the best thing you could do is to get it completely removed but in the event you are unable to get it removed and that particular tradeline is affecting your uti negatively, does it make a difference rather you pay in full or settle it?

Re: Question for Fico Veterans

fused — Thu, 20 Jan 2011 17:36:38 GMT

Yes, the two make a big difference in FICO scoring. Having a trade line (an account) reporting as "settled" can be just as damaging as a charge-off. Another thing to keep in mind is charge-offs factor in the age of your credit history while collections, judgments and BK's do not.

Re: Question for Fico Veterans

sobetrader — Thu, 20 Jan 2011 17:56:45 GMT

So basically your saying is removing collections can actually lower your score because of the aaoa?

And if a person is unable to get a charge off compeletly removed they should get it to a "paid in full" status, correct?

Re: Question for Fico Veterans

haulingthescoreup — Thu, 20 Jan 2011 18:02:01 GMT

@sobetrader wrote:
So basically your saying is removing collections can actually lower your score because of the aaoa? ...

No, look again at fused's reply above. It's charge-offs, not collections (or judgments or BK's etc.) that are part of your AAoA.

Re: Question for Fico Veterans

sobetrader — Thu, 20 Jan 2011 18:05:15 GMT

I stand corrected, I totally meant to say charge-offs, thanks for pointing that out.

So will a person see atleast a moderate increase in their fico when a charge off has been paid in full if its not a big factor into the aaoa?