Hello, I have a question for the credit gurus out there and in advance thank you for your answers. I understand that many negative items (e.g. collections, judgments) stay on the credit report for seven years after ***the last event associated with the item. *** I also understand that more recent negative items pull the credit score down more than do older items Before I go further, are the above statements accurate? If so, here is my question: Suppose one has a six year old unpaid judgment or unpaid collection or some other negative item in their credit hisory. If the person does nothing the item would be removed from the credit file in one year and the credit score would increase. However, what happens if the person decides to pay off the judgment or the collection item? Specifically, will the newly updated status of the item cause it to stay in the credit file for an additional seven years instead of one? Will the credit score tend to go down because the credit item will be "refreshed"? This seems to be a simple question, but I cold not immediately find an answer on the web, so help is much appreciated! THanks.
Collections stay on for seven years from the date of delinquency, so it shouldn't stay on another seven years. However, the recent activity may make it look more recent to the scoring model until it drops off. If it's past the Statute of Limitations, why pay it? Judgments can be renewed and stay on your report longer, I believe.
