I have a CO from 5 yrs ago for $5100 CC from a CU in a state I no longer live where that statue of limitation is 3 yrs. I called the CU to PIF and they provided me the name of the CA that I needed to contact. The CA is not showing on my CR report, only the creditor’s CO with the balance. I tried calling the CA several times but could not get an answer, I opted not to leave a message. I researched the CA and everywhere they have low ratings even from their customers with not responding. I really want to get this taken care of with working with the CA…Any advice? Thanks.
@Reach800 wrote:I have a CO from 5 yrs ago for $5100 CC from a CU in a state I no longer live where that statue of limitation is 3 yrs. I called the CU to PIF and they provided me the name of the CA that I needed to contact. The CA is not showing on my CR report, only the creditor’s CO with the balance. I tried calling the CA several times but could not get an answer, I opted not to leave a message. I researched the CA and everywhere they have low ratings even from their customers with not responding. I really want to get this taken care of with working with the CA…Any advice? Thanks.
With respect to the Statue of Limitations, and please anyone correct me if my thinking is faulty, this simply refers to the amount of time that the creditor has to sue you for collecting a debt. It does not have, necessarily, anything to do with what shows up on your credit report.
Also, the charge off is simply an accounting term for the Creditor / Financial Instituion. For revolvers, a charge-off typically happens after six consequtive non-payments. So, you missed a payment, and then 30 days later the Creditor reports a "30-day late payment" status to the three CRAs. Let's just say that - for whatever reason - you do not pay and the Creditor then reports a "60-day late payment" status to the three CRAs. Once you reach that six month of non-payments (so, 180-day late payment status) the Creditor will typically do a "Charge-Off".
That simply means that they have tried and tried and tried to collect from you but that they were unsuccessful and that they have now given up on attempting to collect.
What tyicpally happens in this process is as follows:
1. The Creditor itself will attempt to collect the monies from you. In other words, they keep that attempt in-house. They still own the debt.
2. During this time, they will continue to update the three CRAs with the "XX-day late payment" status.
3. At some point in time, the Creditor might hire a Collection Agency to attempt to collect the monies from you. So, they are now outsourcing that attempt BUT they still own the debt. The CA is acting on behalf of the Creditor.
4. At some point in time, the Creditor might decide that they have extinguised all avenues and have no hope of ever collecting, so they will sell the debt to a Collection Agency. The Original Creditor no longer owns the debt. The Collection Agency is now the legal owner of the debt.
This is something that is often confused.
So, on your credit reports (look at all three - Experian, Equifax, Transunion) do you see both the orginal Creditor (the CU in the state where you used to live) and the Collection Agency? You stated that you do not see the CA, just the original Creditor. So, at the moment, that answer is clearly "no". However, I ask because the possibility is that the OC just turned things over to the Collections Agency and that update has not yet reflected on your Credit Reports.
Also, lets just assume that the Collections Agency shows up next week. Paying the CA - either in full or at a discount - will possibly result (assuming that this CA does indeed do the P4D) in that "CA account" disappearing from your Credit Report. However, the original account (the one that is with the CU and is marked as a "Charge-Off") will remain on your credit reports for seven years (plus....). Additionally, since that Collections Account was removed (putting it positively) the Collections Accounts on your three CRAs will be empty (again).
Also, I would bet that the "Status Update" field (or whatever it might be called....each of the three CRAs calls it a something a little different) is being updated by the CU (aka, Original Creditor) at least every month. Once you pay off the debt (again, either in-full or at a discount) that will stop. Your credit score is being suppressed by this monthly (or whatever the interval is) update on the CU "Charge-Off" account listed on your CRAs.
I know that this is a lot of information - ask any questions that you might have!
Starting Score: Exp 627
Thanks for the help and encouragement.
All makes sense. Thanks for all the good information.