Repossession drops off, what will happen to credit score
Q: I had voluntary repossession in March 2005. The date of the first delinquency was October 2004. Then a collection agency bought the charged off unpaid balance and I have its record on my credit report from August 2005. When the repossession drops off, will my credit score go up or down? When the original auto loan drops off? And the collection record?
That repossession record is by far the worst thing I have. There are a few student loans that I defaulted in the end of 2003 which since have been consolidated and the defaulted individual accounts should fall within next 2 or 3 months. I also had one 60-day late payment on credit card which should fall sometime in the beginning of 2012.
A: Once repossession drops off, your credit score should go up. The closed original loan will stay for another 3 years and will add a few more points to the scores. Generally speaking, never mind how bad a derogatory account is, it drops off after 7 years and for an additional 3 years it counts a positive account, contributing into your average age of accounts.
The collection agency record is supposed to fall off based on the date of the first delinquency. So once the original negative account with repossession has reached the 7-year mark, the collection record should be dropped of your credit record.
Fri Jan 7, 2011 11:01AM | Copyright: www.bad-credit-advisor.com | More in Credit Score Help | Comments (0)
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