Closed Charge-Off Account and Credit Utilization

Anonymous · ‎06-19-2017

I have an old First Premier credit card that is charged off and closed. The balance is not being factored into my Experian credit utilization therefore that is my highest score. The balance is however being factored into my utilization for TU and EQ, making those score quite lower. Can someone explain to me how I get the balance factored out of my utilization on TU and EQ? Perhaps Experian should be factoring it in and they are not? (which I'm not going to complain about!). Paying these accounts is not an option as they will be falling of next yr and I do not want to reage them. I was recently pre-approved for a mortgage loan but they came back saying all "dispute" remarks needed to be removed. I had them removed but now my mid score 579....literallly 1 point under the limit which is 580. I'm trying to find a way to increase my score just a little so we can move foward with my loan. I figured if I could get the charge off balance factored out of my TU and EQ score that would surely do it! They were not being factored into my utilization prior to me disputing those accounts. Another option I have is to make a large payment on my student loan. Using the simulator, I can see this will increase my FICO 8 Score but will it increase my Mortgage Fico score? I wish the simulators worked for all scoring models! Please help me!

medicgrrl · ‎06-20-2017

When's the last time the account updated? I'm not sure what you mean by re-aging the account...are you concerned about an update or do you think that will start the SOL over?

Paying it off is the only way to remove it from utilization. By disputing the account, you removed it from the scoring. This is why lenders require the dispute remarks to be removed. Do you have any other revolving accounts? If so, what's the balances and credit limits?

EQ 778 EXP 782 TU 729

Anonymous · ‎06-20-2017

It was recently "updated" from a dispute because they validated the debt. By re-aging the account I mean that I do not want to change the "date of last activity" and the clock start all over on the 7 years it will be on my report. It's scheduled to fall off my reports next year. From what I understand, if I make a payment, the "date of last activity" will change. Why is it not being considered in my utilization for Experian Fico Score? It's so weird! I have a few other revolving accounts but they are ALL paid with zero balances. This is why I'm looking at my two options - either pay a chunk of my student loan and pray it raises my score a few points or pay off the charged off accounts (and them remain on my credit another 7 yrs). What do you suggest? Between the 2 First Premier charge off accounts the total balance is $879. My studen loan $9,434. Like I said, I'm more concerned about the mortgage fico scoring models.

Anonymous · ‎06-20-2017

@Anonymous wrote:
It was recently "updated" from a dispute because they validated the debt. By re-aging the account I mean that I do not want to change the "date of last activity" and the clock start all over on the 7 years it will be on my report. It's scheduled to fall off my reports next year. From what I understand, if I make a payment, the "date of last activity" will change. Why is it not being considered in my utilization for Experian Fico Score? It's so weird! I have a few other revolving accounts but they are ALL paid with zero balances. This is why I'm looking at my two options - either pay a chunk of my student loan and pray it raises my score a few points or pay off the charged off accounts (and them remain on my credit another 7 yrs). What do you suggest? Between the 2 First Premier charge off accounts the total balance is $879. My studen loan $9,434. Like I said, I'm more concerned about the mortgage fico scoring models.

It sounds like you have a number of open revolving accounts and they are all reporting a $0 balance. Is that right?

If so, there's a strong chance that you are penalized for having all open revolving accounts at $0. The FICO models like it much better when you have one open card showing a small positive balance.

The next step I would take if I were you is to ensure that you have one true credit card showing a small positive balance, e.g. $15. That might easily get you 10-20 points.

rmduhon · ‎06-20-2017

Date of Last Activity has nothing going to do with when an account will fall off your reports. That is based solely on the Date of First Delinquency (DoFD).

Anonymous · ‎06-20-2017

So are collection accounts handled differently? I have only one collection account and it's with Ad Astra. I've read they will PFD but that you have to dispute the account with the bureaus after you pay. I've been scared to try it because I've also read that if you pay a collection the clock starts over. I probably have nothing to lose because all my bad accounts have been disputed thus they have been updated in the past month. Brought all my scores down :-(

rmduhon · ‎06-20-2017

Charge offs and collections are both bound by the DoFD. So it can't be re-aged. SOL, however, can be reset inot certain situations. So paying the charge off will remove that account from your utilization and could give you the points you need.

DollyLama · ‎06-20-2017

@rmduhon wrote:
Date of Last Activity has nothing going to do with when an account will fall off your reports. That is based solely on the Date of First Delinquency (DoFD).

I've often wondered on this, and never spoke. I worked for and managed a Finance Company, we had write offs on file. If someone did not settle, or pay in full, and was under the SOL and they made say a payment of $40 on a $600 charge off-it did reset the SOL from the $40 payment date.

OP, Is the student loan and the charge off your ONLY open credit?

ETA: I'm reading CGIDs post- if you have open paid revolvers, follow his advice and let one card report with a small balance.

rmduhon · ‎06-20-2017

SOL and credit reporting exclusion period are 2 totally separate things.

Anonymous · ‎06-20-2017

Okay so it shouldn't hurt for me to pay the 2 First Premier charged off accounts. When I use the score simulator and I pay the amount, bringing my utilization down to 0%, it increases my score by 20-30 points! I'm thinking about paying off the collection account with Ad Astra too because I may have luck getting it removed and even it I don't, I know the newer scoring models do not count paid collections toward your score. Does everyone agree? I am needing my score increased ASAP because I'm trying to close on my new house. My next question to you all is - should I still pay a portin of my student loan sense it seems to be the fastest way to get my score to go up? I checked and they report on the 30th of each month. If I pay First Premier - I'm not sure how quickly it will be reported to the bureaus. Does anyone know the date they report? If not, I guess I can call them and ask.