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If you fail to repay a debt and your lender sells that debt to a collection agency, you can end up with two negative entries in your credit report—one for the original debt, and one for the collection account.
The open date for a collection account may be months or even years after the original debt's charge-off: It's the date the debt is transferred from the original creditor to the collection agency. This can make it seem as if an old mistake is returning to haunt you, but it may come as some relief to know that all collection entries related to the same debt share their expiration with the original debt. In other words, the open date on a collection entry does not determine how long it stays on your credit report.
When Is a Collection Account Removed?
The charge-off entry and any collection entry related to that debt will expire and disappear or "drop off" your credit report seven years from the first missed payment that led to the charge-off.
Can a Collection Agency Report an Old Debt as New?
The open date for a collection account is always going to be more recent than the date the original debt was charged off, but lenders and others reviewing your credit report will know that that new collection entries are related to older debts.
It's even possible for a single debt, if uncollected, to lead to more than one collection entry on your credit report. A collection agency that's unsuccessful getting a payment from you can re-sell the debt to another collection agency. If that occurs, you'll see yet another collection entry appear on your credit report, with an even newer open date than the first one.
While the open dates for these collections will vary, they all must retain the delinquency date connected to the original charge-off. The charge-off and all collection entries related to it will disappear from your credit report seven years from that original delinquency date.
Negative entries in your credit report are never welcome, but it may come as some relief to know that a collection entry (or even multiple entries) related to a given charged-off debt will expire at the same time as the original charge-off, no matter what the open date is on the collection accounts.