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does paying collection agencies or original creditors start the 7 year clock again. the collection accounts and original creditors accounts are 3 years old and scheduled to remain on my credit reports for around 4 more years. If I make full payments now, will it start the clock again and show those accounts on my credit reports for 7 more years?
tick tock..
I believe so...When I was considering hiring a credit repair company to repair my credit on their FAQ's page they stated that paying off old debt does no good, it brings the account current and recent and is listed as a negative in your credit report, thus bringing down your score..the only good outcome or possibility of paying an old debt would be if you had a PFD or "pay for delete" agreement, in which when you pay them off they immediately remove it from your credit report altogether...Good luck!
i did some research on the internet and found that the 7 year clock doesn't start again. the clock starts from the first time it was more than 180 days past due.
the statue of limitations is different. maybe the statue of limitations gets restarted if you make a partial payment to the collection agency.
It is true that the clock will start over again.But Pay for delete entry will also be detrimental to your credit (although it is not recurring but it bangs one time.) so you ought to get penalty but PFD will make less damage as compared to disaster.
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insurance
If your debts are close to the SOL (in 'your' state), I would just leave them alone. If the SOL has expired, the CA's, etc, can't come back and try to sue you. I live in PA.....the SOL here is 4 years. The older the debt is, on your CR, the 'less damaging' (lack of a better word) it is to you. If you do decide to do a PFD letter, and the CA agrees on this, make sure to get everything in writing, so you have proof of what you are saying.
Paying in full will restart the 7 years clock
If you make full payment now, the 7 years clock will restart again. Paying your old debt will not help you to improve your credit score, but if you desperately want to do it, be careful that you get everything in writing. Try to negotiate with your collection agency or your creditors to get a full deletion of any or all negative entries reported on your credit report. If the creditor agrees to pay for deletion agreement, the negative items gets removed. You must get pay for delete agreement in writing, so that you can have a proof that your creditors have agreed to remove the negative items from your credit report, after you make the payment in full.
paying off old accounts
Hi poorman,
If you make payments on your old accounts, it can restart the Statute of Limitations. However, the 7 years you are talking about, and the SOL are not the same thing.
Negative listings against the accounts stay on your credit report for seven years.
The SOL on the other hand is the time limit within which the creditor or colelction agnecy can sue you for non payment of debt. SOL starts from the date of last payment. Thus, when you start making payments on an old account, the SOL restarts.
However, if you make the payments in full, your account status will be updated as "Paid in full". In order to remove the negatives. request the original creditor, or the collection agency to agree to a "Pay for delete" (PFD) agreement. If the creditor or collection agency agrees to PFD agreement, the negatives will be removed, and your account will automatically be updated as "Paid in full".
Thanks,
Aaron
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1Fl67D Thanks-a-mundo for the article.Really thank you! Fantastic.