In general terms, monthly delinquencies tell creditors and those producing credit scoring risk analyses that you have been delinquent in the past, and of course the severity of the delinquency affects the severity of its risk implication, but monthly delinquencies by themselves dont paint a very complete picture.
What happened after the delinquency? Was the account brought back into paid, good standing, or did a more severe form of delinquency come about?
Delinquencies themselves dont tell that story.
Collections, charge-offs, and judgments begin to tell that story.
A charge-off means the debt reached such an age of delinquency that it could legally be declared "uncollectible," permitting the creditor to obtain a tax benefit for the non-receivable debt. Most charge-offs dont even occur until a debt has reached 120+ late, and only then when it remains unpaid. A double whammy-- 120 late plus no reasonable expectation of payment.
A collection means the consumer delinquency reached a state where it was either sold for a portion of its worth, or was referred for external assistance in its collection.
And of course, a civil judgment means the creditor had to obtain assistance of the court to obtain an order of obligation to pay.
When viewed in that manner, collections, charge-offs and judgments paint a more serious picture of consumer willingness/ability to pay delinquent debt upon manual review of a consumer's credit history. And all I have read about credit scoring and seen from experiences of other consumers is that they are scored more harshly and decline in impact more slowly than serious levels of monthly delinquency.
I vote for collections being more serious than 90-120+ lates.
