Will this help my credit score?

[DI]

I have an account that was charged off in 2004.  It was a car loan that I cosigned for.   I recently settled the account. The account is still with the original creditor.  The  creditor agreed to list the account as 'Paid' and Close with $0 balance.  I was told nothing else will be listed.  What will that do to my credit score?  It is currently in the low 700's.

[AndySoCal]

This should help the score go up. How much is hard to say. The debt you settled was five years old roughly. How many points that was impacting your score is hard t say.

[RobertEG]

IMHO, no, it wont help.

Paying accounts helps in a manual review, and forcloses the possibility of legal action.  I also forclosed the possibility that they would then refer it to a CA, which would have entered another ding to your CR.

But as for current scoring, FICO does not score paid accounts with any more favor than upaid.

[DI]

If the balance goes to $0 after the CO is paid, will that not help the score increase?

[Anonymous]

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@DI wrote:
I have an account that was charged off in 2004.  It was a car loan that I cosigned for.   I recently settled the account. The account is still with the original creditor.  The  creditor agreed to list the account as 'Paid' and Close with $0 balance.  I was told nothing else will be listed.  What will that do to my credit score?  It is currently in the low 700's.

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If this means all derogs (lates, CO, etc) are removed and the account shows "Paid" and $0 balance, then yes this will help.

If you end up with "Paid" but remarked as settled or paid after charge off, then it won't help much, if at all in FICO.

From your description, it sort of sounds like the OC is agreeing to a GW upon payment, which if so, then this is a good thing for your FICO and credit in general. 

[Anonymous]

It may or may not help but good luck anyways



edited to remove image --gawwad, please do not insert non-Lithium images.

Message Edited by haulingthescoreup on 06-01-2009 04:59 AM

[AndySoCal]

Let add a little more to my first post. As delinquent accounts like collections and charge offs get older their impact on your score dimishes over time.  Depending on the rest of the credit history how much the removal this negative information on this account will help your score.