I know that the paying up a charge off is not supposed to raise your score that much but my husbands score is 606 so anything over 620 is fantastic. However, I also know that FICO is influenced by having high balances and going over the limit. The charge off is being reported as going over the limit of an already maxed out card because of close to 1000 dollars in late fees. If we pay off the charge off after negociation will our credit score go up and if so how many points based on the fact that we have lowered our balance to zero? (This is a hypothetical assuming that no negoctaions for deletion of the negative entry would be successful.) We will take anything. We then will look for a home in two years.
Also, I was shocked to hear that someone finally got an old account deleted with late payments thinking it would help the FICO score but it actually made it drop 69 points because she lost an old trade line. In my husbands case the charge off is an account from 1993. Since it is a charge off should we try to get the trade line completely deleted or would we be better off trying to reage the account and getting some of the negative items removed? Which would be beter for the score? Thanks Diane
There's a dozen good questions there. There's no clear cut answer. If you're going for a mortgage, they're likely going to require you to satisfy the debt, regardless of raising or lowering your score. I can tell you from personal experience that it's much easier to dispute/ validate/ nutcase away a paid tradeline than an unpaid tradeline. Before doing either, you might want to try to negotiate for deletion or change of status. Run a search here to find others who have successfully done that.
My own feeling is, get rid of all negatives, and deal with the possible repercussions, but you'll have to be your own judge. If that's your only aged tradeline, it's a tougher choice. I know what I'd do, but, again, you'll have to read, study, think, and decide. You could also try disputing just specific aspects of the listing, such as the late pay history, but again, while you owe them money, they will most likely be vigilant.
Definately something wrong. If the chargeoff is from 1993 then it is past the statute of limitations and you do not have to pay it back. Also, it is well past past the 7 years so it should not even be reporting on the credit bureau. Someone bought the debt after the SOL was up for probably about $20 knowing they had little chance of collecting but hey, it is worh a try. If you pay this then they will make a fortune and you just paid for some collection agency guy to go on a nice vacation. I would look at your credit report at the date of last activity/collection and see when it was charged off. Make a copy of it then come back here and let us know what it says. If they reaged the account then that is illegal.
A little clarification. The account was opened in 1993 the charge off did not offically happen until November of 2001. It is an older trade line whichi s why I had the question of whether I should go for full deletion or a change of statis like R9 to an R4 or something.so the account itself was not deleted. Thanks