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Pay or not pay

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KingJaffeJo
New Contributor

Pay or not pay

Hello all-
I’m fairly new to the forum so I have a payoff question to ask and I’m hoping that someone can provide me with the info that I’m looking for.

I have a remaining charge off balance of $1600 with BOA and it’s after the SOL. The charge off started back in 2014 but I’ve been paying it down over the past few yrs. I just noticed that it pops up in my credit report every month now even tho I’m paying down on it. Is that supposed to happen? I don’t recall seeing it on my report previously. Why after a few years of paying it down is it now coming up as a charge off?

Another question....Since it’s already charged off, is there a benefit of paying the balance off at this point since it will still be on my report until 2021? Will that $1600 really hurt my score since the outstanding balance will still be out there?

Thanks in advance for your help with this.
Message 1 of 20
19 REPLIES 19
OmarGB9
Community Leader
Super Contributor

Re: Pay or not pay

Yes there's still a benefit to paying it off, IMO. Unpaid charge offs are the equivalent of being over limit on a card, since the closed account has a $0 credit limit, it's $1600/$0. This in turn suppresses your scores. Paying it will lower utilization and let the CO age.

Last App: 1/10/2023
Penfed Gold Visa Card

Currently rebuilding as of 04/11/2019.

Starting FICO 8 Scores:




Current FICO 8 scores:


Message 2 of 20
gdale6
Moderator Emeritus

Re: Pay or not pay

Yes the balance will be updated as you pay it off as the FCRA requires accurate information be reported.
Message 3 of 20
KingJaffeJo
New Contributor

Re: Pay or not pay

Is there a way to stop it from reporting every month since I am actually paying it down?
Message 4 of 20
gdale6
Moderator Emeritus

Re: Pay or not pay


@KingJaffeJo wrote:
Is there a way to stop it from reporting every month since I am actually paying it down?

Only way is to pay it completely off.

Message 5 of 20
2Hogrider
Established Member

Re: Pay or not pay

I would call them and make an offer for PFD as it will continue to show up until it is paid in full  Also, It will not be the  7 years for it to drop off your credit report from original delinquency it will be 7 years from your last payment as you've acknowledged the debt by making payments on it, therefore, resetting the time clock on the debt.

Message 6 of 20
OmarGB9
Community Leader
Super Contributor

Re: Pay or not pay


@2Hogrider wrote:

I would call them and make an offer for PFD as it will continue to show up until it is paid in full  Also, It will not be the  7 years for it to drop off your credit report from original delinquency it will be 7 years from your last payment as you've acknowledged the debt by making payments on it, therefore, resetting the time clock on the debt.


I don't believe that's correct. The resetting the clock is only for SOL I believe. The credit reporting is 7 years from DOFD regardless. 


Last App: 1/10/2023
Penfed Gold Visa Card

Currently rebuilding as of 04/11/2019.

Starting FICO 8 Scores:




Current FICO 8 scores:


Message 7 of 20
2Hogrider
Established Member

Re: Pay or not pay

 

Message 8 of 20
FireMedic1
Community Leader
Mega Contributor

Re: Pay or not pay


@2Hogrider wrote:

 


You restarted the SOL and all it takes is acknowledging that you owe the debt, making a payment, entering a payment plan, making an agreement to pay, making a charge on the account, accepting a settlement offer. That was a collection not a charge off.

 


Message 9 of 20
KingJaffeJo
New Contributor

Re: Pay or not pay

Mine is actually a charge off. The BOA rep stated that the charge off went into affect in 2014 and that it will stay on my report until 2021. With that being said, that made me believe that even tho I’m paying down on it, it wouldn’t reset the late payment clock meaning, seven years from my last recent payment. Am I correct?
Message 10 of 20
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