Paying a Charge Off

[Anonymous]

Okay....so I paid the Cap 1 CO in full - $1722  on August 9th.  I got a receipt from Cap 1 on August 13 that they acknowledged the PIF dated August 9.  Any idea how long it will be before before this shows paid on my credit report?  I know for a fact that they reported the charge off amount every month for the past 5 years, so I would hope they would report the PIF within a month.  Nothing yet though.

Just wanted your thoughts.

Jodi

[Anonymous]

This is completely confusing. The only reason I haven't PIF'd the last couple of old COs is because I'm not sure whether doing so will hurt or help my score in the immediate future. I was going to try for PFD and am waiting for my little green cards now. I could pay a couple of them TODAY, right now, in exchange for PFD. Should I even try to call the CAs? Would that be like whacking a tiger with a stick? (I wouldn't give them a penny until I got their guarantee in writing.)

[Anonymous]

Just got a scorewatch alert....my chargeoff account was reported as paid and my FICO score increased 54 points to 710.   Soooo happy!!!!!  Thanks to all for the great advice on this site!!! 

[terrymurph]

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@Anonymous wrote:

Just got a scorewatch alert....my chargeoff account was reported as paid and my FICO score increased 54 points to 710.   Soooo happy!!!!!  Thanks to all for the great advice on this site!!! 

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I KNOW HOW  FEEL I WENT FROM 631 YO 676 WHEN I PAID MY CHARGE OFF YAYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYY. LOL i needed to scream that one,

[Anonymous]

Congrats!!!      i also have a charge off that is supposed to fall off my ca in 06/12.  it was sent to a ca and i wanted to know if i should send the ca a validation letter or a pfd letter.  the account is with first premier and the ca is arrow.

any help would be appreciated!!!

[RobertEG]

Unpaid charge-offs are a smoking gun.  You have options, each with its own benefit and peril.

A PIF of a charge-off has no immediate credit scoring benefit, as it does not erase the prior reporting of the derogs that led up to the CO.

Yes, they will update status to show PIF, but no, that wont help your credit score.

Options:

!. Just do a PIF
   This has the benefit of eliminating the debt, and thus any future perill of referral to a debt collector, and thus posting of a CA

    to your credit report, and/or  additionally, any peril of legal action.

   This has the drawback of not requiring any deletion of anything from your CR.

    Just an update of account status to paid  Zero credit scoring benefit.

2.  Offer a PFD

     This has the potential benefit, if and only if accepted, of also obtaining removal of derogs from your CR

     But a PFD offer bears no requirement for any response, and the account thus continues to linger on, with unpaid debt.

     If still only a CO, then the OC can refer it out for collection, or sell it to a debt collector.

     Worst of all, they can bring direct legal action for a judgment on the debt.

      PFDs are a gamble.  No one can tell you whether or not it is best to offer a PFD, and wait.

Acceptance of a PFD offer by the creditor or CA is increased if either the debt has passed expiration of your SOL, or has passed expiration of your statutory drop off of the CO from your CR after 7 1/2 years from the DOFD on the OC account.

No simple answers.

[RobertEG]

Debt validation letters are directed to debt collection practices under the FDCPA

PFD offers are related to asking for credit reporting deletion of information previsously posted under the FCRA.

You send a DV letter for two primary reasons.

1. To secure the name of the original creditor and the asserted (not proven) amount of the asserted debt; and

     thus satisfy that the collection was based on an OD debt that you agree with.

2. To requrie the debt collector to cease any future debt collection activiies until the respond.

You send PFD letters to attempt to secure deletion of previously posted items from your credit report.

Neither a DV letter nor a PFD letter sets any time period for response.

True  disputes of any reporting to your CR are not best handled by DV or PFD letters. 

They are handled by disputes under either FCRA 611(a) or 623(a).

That does not imply  that DV or PFD letters are not worthwhile, or should not be sent.  Only that they dont resolve disputes.

[Anonymous]

I had a Capital One charge off (CO) January 2005 totaling $2,024.00 and Capital One periodically adds some type of fees and the the balance is now $4,811.00 and they report the CO every month. My credit limit was $1,400.00 so it makes my utilization 343% which is killing my scores. I though once an account was charged off that the balance wouldn't change. The Capital One account is scheduled to drop off my reports in May 2011. Can Capital One continue to assess fees and report the CO as "current" each month?

Is there a specific department at Capital One that handles COs? If so, I would sincerely appreciate their contact information.

[ShootingStar]

I'm hoping to get some clarification on whether a paid CO results in a point increase to your FICO.  I've always heard that there is no positive FICO result from simply paying a CO, that it would need to be removed; however, there are two posts above that indicate a rather significant FICO increase by simply PIF.  Thoughts?

[tonio2148]

bump