It is inaccurate reporting, and clearly basis for dispute.
Once you have settled a debt, regardless of whether paid in full of settled for less, the current status flips from delinquency to paid.
The prior payment history profile records the historical prior monthly status for prior months.
It is clearly inconsistent and inaccurate to show a current status for a given month of paid, or paid for less,which are both non-delinquency current status, and then show that status for that same month in subsequent reporting as any delinquency status in the payment history profile.
As an aside, FP is not a formal delinquency reporting code that is reported to the CRAs. They must report as either, for example, 90-late or CO.
FP is a designation that was used by the vendor who put together the commercial credit report, and is only an interpretation of what was reported to the CRA. Thus, a dispute of an FP designation may create problems with the CRA, as the current and prior monthly status reporting in their files will not be FP.
As a final observation, you might reconsider filing any dispute.
The post states that the account was charged-off. A creditor has the option after taking a CO to report the current status and prior payment history profile showing of prior monthly delinquency status as either the time since initial delinquency (e.g., 90-late) OR as CO, which is reporting that the account was delinquent and additonally charged to profit and loss.
If you dispute the accuracy of the payment history profile by contesting the FP showing after it was paid, the creditor might decide to substitute CO for any prior month that the account was delinquent and had also been charged-off.
A CO is generally viewed as a more serious reporting of delinquency,and you might wish to avoid any showing of CO in your profile by not filing a dispute that causes them to review their reporting.
