sold collection new CA

[dabolts_619]

Sorry if this is in the wrong place. But what happens when a collection goes from one CA to another scouting wise????

[llecs]

Score-wise? If CA#1 dumps the TL becuase the sold the debt, then you'd likely see a nice increase. CA#2 takes over and the score plops back to where it was before, give to take. It depends on how CA#2 reports. There's an increased risk for a lower score compared to where it was before.

[dabolts_619]

Thanks. Yes I meant score-wise

[RobertEG]

There a three ways further collection authority of a debt collector can terminate:

1. The debt is satisfied, upon which the debt collector must close the reported collection and report a $0 balance under collection;

2. The debt collector was an assigned collection agent of the credit (i.e., they did not own the debt), and either they chose to withdraw or the creditor terminated their contract; or

3. The debt collector owned the debt, and sold it to another.

None of those scenarios requires the debt collector to delete their prior reporting.  In cases 2 and 3, many debt collectors will choose to delete their prior reporting, if for no other reason than to prevent any future FCRA complaints over the accuracy of their reporting, and clear out their records.  However, there is no requirement that they do so.

In all cases, if still under a cease collection bar resulting from a pending and unanswered DV, they obviously wont be conducting any future debt collection, so the issue of any DV requirements upon them becomes moot.

If a consumer's credit file thus contains two, non-concurrent collections reported on the same debt, how FICO chooses to score them is unknown, at least to me.

Logic would lead one to believe, or at least hope, that the FICO algorithm is sophisticated enough to recognize them as one, related collection.

Hopefully, someone will chime in with additional information.