When paid off accounts are deleted

Dear Experian,

If I pay off a negative account on my credit report, will it be removed from my credit and raise my score or will it remain on there seven years and not change my score? How does this work?



Dear TYK,

Paying off a negative account does not cause it to be deleted. But doing so is the first step in improving your credit scores.

When you pay off negative account, or just catch up on the late payments, the status of the account is changed. It will show that it is now paid — or current if you didn’t pay the entire balance — but that it was late in the past.

Negative information is deleted seven years from the original delinquency date, which is the date the first late payment was reported. For example, if the account became late five years ago and you pay it today, the time does not start over. The late information still will be deleted in two years.

Paying off negative accounts won’t necessarily result in an immediate increase in credit scores. However, the further in the past late payments or other negative information occurred, the less impact it typically will have on credit scores.

In addition to bringing your accounts current, you need to continue to use credit in a very positive way. If you just stop using credit, with only the bad account history, you aren’t demonstrating that you can now manage credit well.

The recent good behavior will help offset the old bad behavior of missed payments and very likely will help your scores improve more quickly.

Thanks for asking.

- The “Ask Experian” team

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