topic Re: Kohls updated incorrectly in Rebuilding Your Credit

Kohls updated incorrectly

Bellasmom15 — Mon, 04 Oct 2021 15:30:42 GMT

I have a kohls card from 2015ish that was charged off. I finally decided to pay it off because our CU told us that our auto refinance rate would be significantly lower if I could prove it was in the process of being rectified.

I made an arrangement with kohls themselves to settle for half of what was due over 3 payments. Logged in to myfico.com today to find that one of my scores nosedived by 29 points because kohls updated. I've added a picture of the alert with the statement that tanked it. What do I do?! Is this Normal?! I'm kinda mad because they're obviously being paid and it's not "uncollectible"... I had been at 697 before I took this hit.

Re: Kohls updated incorrectly

FireMedic1 — Mon, 04 Oct 2021 16:27:30 GMT

Something triggered that alert. So something moved. But it still shows the balance. The next update will probably have the $0 balance which all CO's have to show settled or paid and then it will say settled for less than amount owed on it. MyFICO usually doesnt do all the movements in 1 alert. Takes a couple alerts.

Re: Kohls updated incorrectly

Bellasmom15 — Mon, 04 Oct 2021 16:48:23 GMT

If I'm understanding correctly, one payment on the outstanding balance could've triggered that alert and tanked my score like that? I don't get why my score would drop of the balance decreased by the amount I paid.

If that's the case, I'm definitely making the next two payments this month instead of this month and in November.

Once it's updated to a 0 balance, will my score recover from that hit? I'm hoping they'll just take the whole tradeline off completely. My old credit one card disappeared after I paid off the collection on my last one and opened a new account. Will kohls do the same thing?

Re: Kohls updated incorrectly

FireMedic1 — Mon, 04 Oct 2021 19:03:39 GMT

Oh now I see. Your paying it down. Yes the balance will decrease until fully settled as you pay it down. If you can PIF the remaining do so. The point hit was from being a new update of said CO. Each payment will show a new updated balance. Almost like filing a dispute on accurate items that people do thinking the dispute will delete something. And it doesnt and here comes the hit for the fresh update. Once the $0 balance shows. It will no longer count against your aggrgate util %. Then in time the CO will age and fall off.

Re: Kohls updated incorrectly

OmarGB9 — Mon, 04 Oct 2021 19:11:02 GMT

@Bellasmom15 wrote:
If I'm understanding correctly, one payment on the outstanding balance could've triggered that alert and tanked my score like that? I don't get why my score would drop of the balance decreased by the amount I paid.

If that's the case, I'm definitely making the next two payments this month instead of this month and in November.

Once it's updated to a 0 balance, will my score recover from that hit? I'm hoping they'll just take the whole tradeline off completely. My old credit one card disappeared after I paid off the collection on my last one and opened a new account. Will kohls do the same thing?

I'm guessing this account hadn't updated since 2015? If so, the update when your payment was applied caused the dip because the account was updated and it caused a "catch up" penalty wherein you should've been penalized every month if they had been updating regularly every month. But since they weren't, your scores were benefitting from their lack of updates. In any case, it makes it look like a "fresh" derogatory in the eyes of the FICO algorithm, thus causing the score hit.

Yes you'll recover the points, but not immediately. Most likely you'll recover part of them once the account is fully paid off and reflecting $0 balance. The rest will come over time as the derogatory finally ages the proper way (no monthly updates and $0 balance).

Also, the Kohl's TL most likely won't be deleted. Credit One tends to do that, but Capital One usually doesn't.