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Points- How Many as Derogatory gets older?

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Points- How Many as Derogatory gets older?

I've searched these forums and couldn't find an answer...

At what years on the 7 path do these negatives start counting less on your overall score ?

3, 4, 5, 6?

Thx!!
Message 1 of 21
20 REPLIES 20
Super Contributor

Re: Points- How Many as Derogatory gets older?

There are 2 other variables here that need to be known outside of the element of time:

1 - How many negatives

2 - The severity of them

 

The answer to your question would be very different if you're talking a person having a single 30 day late payment verses a different person that has multiple major negative items (90+ day late, collection, etc).

Message 2 of 21
New Member

Re: Points- How Many as Derogatory gets older?

Thank you for the response.. multiple past 90 day Medical Bill's... 4 to 5 yrs old each not paid
Message 3 of 21
Community Leader
Legendary Contributor

Re: Points- How Many as Derogatory gets older?

If you have a debt that is still delinquent, as is apparently the case as you state that the debt is still unpaid, then the creditor can, at any time, update their reporting to show a current status that it remains delinquent.

That means that the delinquency period has extended.

That will result in increased level of delinquency since initial delinquency, with negative scoring effect.

 

Contrasting that with the scoring of prior reported delinquencies where the debt has been paid, payment terminates the delinquency status of the debt, and thus fixes the highest level of delinquency.  It is only then that the delinquency scoring begins to age, with decreased scoring impact.

 

Stated differently, if the debt remains delinquent, negative impact increases, not decreases, as updates are made.

The period since initial delinquency continues to increase until the account is brought out of delinquency status.

"Derogs getting older" only produces score improvement when the delinquency has terminated.

Otherwise, the "derogs get longer/greater" and their negative impact increases.

Message 4 of 21
Established Contributor

Re: Points- How Many as Derogatory gets older?

Omg this explains why my scores are so low! I have an old account in collections (set to come off in October) but the status is current. Those jerks update it every single month, even after 7 years 🙄 I kept reading that old collections don’t really have an impact, but it makes sense now.
I’m probably never finding that garden everyone keeps talking about.



Officially collection free as of 3/19/19!!
STARTING SCORES: 377 (11/2013) & 580 (3/2018)
Message 5 of 21
Moderator Emeritus

Re: Points- How Many as Derogatory gets older?


@Queen_Etherea wrote:
Omg this explains why my scores are so low! I have an old account in collections (set to come off in October) but the status is current. Those jerks update it every single month, even after 7 years 🙄 I kept reading that old collections don’t really have an impact, but it makes sense now.

Sadly old collections carry full weight except if they fall under one of the newer FICO model guidelines:

 

FICO 8: any collection under $100 is discounted

FICO 9: any paid collection is discounted

 

Beyond that though, collections bucket you similarly to tax liens and BK's frankly, and as such they penalize you for the entire time they are on there.




        
Message 6 of 21
Frequent Contributor

Re: Points- How Many as Derogatory gets older?

Well I was going to post how severe negatives weigh on your credit scores until they fall off, imposing a ceiling on their growth.  Which is unlike 30 day lates whose effects lessen with time.  Then I noticed the OP's other post saying they were medical collections.  If I remember right, medical collections once paid, are handled differently than other collections and won't have as long of a negative impact as say credit card accounts. Or am I remembering this wrong?  It's been several years since I had one.

 

But any account that is not paid, even if the account hasn't been freshened in the last year, as long as it reports unpaid with a balance, will really tank your scores.

 

Current FICO8: EQ:777, TU:754, EX:761 | 2x 30 day lates 4.5-6yrs ago
AAoA: 10 years; AAoOA: 13 months; Credit Length: 21 years
INQ Eq: 3 / Tu: 5 (4 for auto) / Ex: 9 (5 for auto)
Message 7 of 21
Moderator Emeritus

Re: Points- How Many as Derogatory gets older?


@Miner wrote:

If I remember right, medical collections once paid, are handled differently than other collections and won't have as long of a negative impact as say credit card accounts. Or am I remembering this wrong?  It's been several years since I had one.

 

But any account that is not paid, even if the account hasn't been freshened in the last year, as long as it reports unpaid with a balance, will really tank your scores.

 


Yeah, medical collections are handled differently under FICO 9: not given as much weight.

 

FICO 8 and earlier still same as normal CA's to my knowledge.  There aren't that many lenders using FICO 9 but enough are out there that one could target them if medical collections are the only thing holding one back.




        
Message 8 of 21
Established Contributor

Re: Points- How Many as Derogatory gets older?


@Revelate wrote:

@Queen_Etherea wrote:
Omg this explains why my scores are so low! I have an old account in collections (set to come off in October) but the status is current. Those jerks update it every single month, even after 7 years 🙄 I kept reading that old collections don’t really have an impact, but it makes sense now.

Sadly old collections carry full weight except if they fall under one of the newer FICO model guidelines:

 

FICO 8: any collection under $100 is discounted

FICO 9: any paid collection is discounted

 

Beyond that though, collections bucket you similarly to tax liens and BK's frankly, and as such they penalize you for the entire time they are on there.


Yeah I have 2 collections and both are medical. One is for $80, which I paid a few weeks ago, but it hasn't updated yet, and the other is for $1,600. I'm guessing the $80 one isn't doing any damage, but that $1,600 one is hurting for sure. That's the one that says "open" on my reports. Oh well... one more month and it'll be gone.

I’m probably never finding that garden everyone keeps talking about.



Officially collection free as of 3/19/19!!
STARTING SCORES: 377 (11/2013) & 580 (3/2018)
Message 9 of 21
Moderator Emeritus

Re: Points- How Many as Derogatory gets older?


@Queen_Etherea wrote:

@Revelate wrote:

@Queen_Etherea wrote:
Omg this explains why my scores are so low! I have an old account in collections (set to come off in October) but the status is current. Those jerks update it every single month, even after 7 years 🙄 I kept reading that old collections don’t really have an impact, but it makes sense now.

Sadly old collections carry full weight except if they fall under one of the newer FICO model guidelines:

 

FICO 8: any collection under $100 is discounted

FICO 9: any paid collection is discounted

 

Beyond that though, collections bucket you similarly to tax liens and BK's frankly, and as such they penalize you for the entire time they are on there.


Yeah I have 2 collections and both are medical. One is for $80, which I paid a few weeks ago, but it hasn't updated yet, and the other is for $1,600. I'm guessing the $80 one isn't doing any damage, but that $1,600 one is hurting for sure. That's the one that says "open" on my reports. Oh well... one more month and it'll be gone.


Nice!  Chance that $1600 one might be outside your state's SOL anyway; however, if those are your only two negatives there's a good chance you'll get a non-trivial bump on both FICO 8 and FICO 9 though the paid collection will still depress your mortgage scores for a while.




        
Message 10 of 21
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