Experian credit score dropped 38 points after paying off a charge off?

[Anonymous]

In February, I paid off in full an account that was charged off in 2015. I filed a dispute with Experian and provided them with the receipt of payment to ensure they would update my account. While my dispute was being reviewed, they received an update from the company that charged off my account and my score had gone up 10 points.

On March 10th, I received an email that said my dispute was completed. I checked my Experian score and it had dropped 38 points. Upon reviewing the dispute, I found that my payment history was deleted. Before the dispute, my payment history said my account has been charged off since November 2015. Now, my account says it was charged off as of March 2021 with no other payment history. I called Experian and they said my account shows that it was paid in full and they do not think they made any negative changes as a result of my dispute, though the dispute results shows that my payment history disappeared. What should I do?

[Anonymous]

Sounds like the account was updated to the current date, so the algorithm is viewing the major derog as being more recent and thus your scores were impacted accordingly.

[babygirl1256]

Hi Jdwinn . . . I experienced a similiar situation in 2020 and got tired of being routed to Experian's overseas team; so I researched and found a phone number for the Office of the President. I received a call from the Special Services Department that handle issues forwarded to them by the executive team. I was contacted and the issue was resolved. I'm a relatively new poster and not sure if I can post a contact number, so I will send you the number via private message. Hope that you get it resolved. Let me know if I can be of further assistance.

[Anonymous]

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@Anonymous wrote:

In February, I paid off in full an account that was charged off in 2015. I filed a dispute with Experian and provided them with the receipt of payment to ensure they would update my account. While my dispute was being reviewed, they received an update from the company that charged off my account and my score had gone up 10 points.

On March 10th, I received an email that said my dispute was completed. I checked my Experian score and it had dropped 38 points. Upon reviewing the dispute, I found that my payment history was deleted. Before the dispute, my payment history said my account has been charged off since November 2015. Now, my account says it was charged off as of March 2021 with no other payment history. I called Experian and they said my account shows that it was paid in full and they do not think they made any negative changes as a result of my dispute, though the dispute results shows that my payment history disappeared. What should I do?

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Anytime you pay off a charge off you will get a drop in score because you have basically cause the company who you paid to report that to the CB's which then update it on your credit report.   If it was in collections you probably would not have seen a dent.  A charge off is like a sleeping bear that you should have left sleeping until it dropped off.  Charge off's no longer bring down your scores monthly.  Sure it looks bad on your reports and sure others will see it but monthly charge offs do not bring your scores down as the company you owe is no longer sending reports to the CB's saying it is due like collections.   So you basically woke up a sleeping bear that should have been left alone.  

[OmarGB9]

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@Anonymous wrote:

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@Anonymous wrote:

In February, I paid off in full an account that was charged off in 2015. I filed a dispute with Experian and provided them with the receipt of payment to ensure they would update my account. While my dispute was being reviewed, they received an update from the company that charged off my account and my score had gone up 10 points.

On March 10th, I received an email that said my dispute was completed. I checked my Experian score and it had dropped 38 points. Upon reviewing the dispute, I found that my payment history was deleted. Before the dispute, my payment history said my account has been charged off since November 2015. Now, my account says it was charged off as of March 2021 with no other payment history. I called Experian and they said my account shows that it was paid in full and they do not think they made any negative changes as a result of my dispute, though the dispute results shows that my payment history disappeared. What should I do?

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Anytime you pay off a charge off you will get a drop in score because you have basically cause the company who you paid to report that to the CB's which then update it on your credit report.   If it was in collections you probably would not have seen a dent.  A charge off is like a sleeping bear that you should have left sleeping until it dropped off.  Charge off's no longer bring down your scores monthly.  Sure it looks bad on your reports and sure others will see it but monthly charge offs do not bring your scores down as the company you owe is no longer sending reports to the CB's saying it is due like collections.   So you basically woke up a sleeping bear that should have been left alone.  

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That's not true at all. Charge Offs can and do update monthly, suppressing scores. Creditors don't always choose to update a CO monthly, but most of the time they do.

And yes, COs do, in fact, keep hurting your scores as long as they remain on reports, whether they're updating monthly or not. Paying them alleviates this a little, but they still sting just like a collection.