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Topics addressed on April 11, 2012:
Paid collection account not deleted immediately
How do I get something I have paid removed from my credit report? I'm trying to get approved for an apartment and I need it taken off ASAP. I have the letter from the collection agency showing the debt has been paid in full.
The most important thing to remember about a credit report is that it represents your credit history. Paying off a collection account will not cause it to be deleted immediately from your credit report right away. Instead, the account will be updated to reflect the current status. The history will remain.
In this instance, the collection account will be updated to show that it is paid in full. However, the record of late payments and collection account will continue to be shown for seven years from the original delinquency date of the original account.
The original delinquency date is the first date that the account became late and after which was never again current. Collection agencies are required to report the original delinquency date from the original lender. That date does not change, even when you make payments on a collection account.
Creditors rely on a complete history to help them make sound lending decisions. They need to know not only that you have taken control of your debts now, but also that you have managed your credit well over time.
Consumers who don’t manage debt well often repeat the pattern and get in trouble again. So, even though you are paying as agreed now, your history indicates that you are higher risk than someone who has always managed their money well.
A record of on-time payment will begin to off-set that history and demonstrate that you have overcome any financial challenges you may have been going through.
Thanks for asking.
- The "Ask Experian" team