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Capital One Charge Off Dropped


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Hello, I'm new to credit boards.  I have been working to improve my credit since late 2020.  When I started this process I had several delinquent student loans and unpaid two charge off credit cards.  I also had another CC charge off  and a loan charge off that were both paid. I consolidated my delinquent student loans in July 2021 - Balance is $23,000.  I have a charge off for $8,082 with Barclays Financial.  I had a charge off for $2,790 with Capital One.  I opened two credit cards (Ollo $500 and Credit One $600) to rebuild credit and keep a low balance (most of the time it is $0 balance when it is reported).  When I started monitoring my credit in January, my score was 562.  Today it is 695 (Experian).

 

I had been saving money to pay off the two charge offs, and finally saved enough money by September to pay them off in full.  Then, I became aware that I could potentially lose my job due to COVID, and so I held off on making the payments (I hope to know by end of December about my job status).  However, to my surprise, the Capital One Charge Off fell off my credit report sometime in October. When it dropped, the number of 30+ days late accounts decreased and the time since my last delinquency increased by 3 years 4 months.  My score jumped 115 points since September.

 

Is it possible that this will now go to collections or have some other future adverse impact on my credit? I'm ecstatic that it is no longer on my report, but would like to know what could happen with this going forward. 

 

Also, I had every intention of paying, and would like to once I know what my job situation will be.  If I don't lose my job, should I contact them to pay in full, request a settlement, or something else? If I lose my job, I will need to use the savings I have from the charge offs to pay my rent until I find another job.

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On 11/23/2021 at 12:06 PM, Glacier said:

For the Capital One account which fell off your report, do you know when it became delinquent and was never brought up to date?  

The account became delinquent in 2015.  I paid on it sometime in 2016 I believe - just a small amount but hadn't paid on it since.

Edited by PACMOM
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On 11/23/2021 at 11:17 AM, PACMOM said:

Is it possible that this will now go to collections or have some other future adverse impact on my credit? I'm ecstatic that it is no longer on my report, but would like to know what could happen with this going forward. 

 

Also, I had every intention of paying, and would like to once I know what my job situation will be.  If I don't lose my job, should I contact them to pay in full, request a settlement, or something else? If I lose my job, I will need to use the savings I have from the charge offs to pay my rent until I find another job.

 

From the information you added, it's safe to say that the Capital One default was removed because it's been more than 7 years (or close to that) since the original delinquency date.   The CRA's aren't permitted to report such debt beyond this point, so ideally you shouldn't see it on your reports again (even if they should submit it for outside collection).

 

Such "obsolete" accounts sometimes do pop up again (but seldomly).  If so, you would want to initiate a dispute to remove the inaccurate reporting.  (It's an unlikely event, however.)  For the time being, it's reasonable to assume that this problem debt is behind you.

 

Some people elect to pony up for such obsolete accounts as a matter of conscience.  I wouldn't deter someone from doing so if they were so inclined.  However, this is a world of scarce resources and (generally speaking) I would suggest such an action only if you were completely confident about your future long-term financial prospects.   As that suggests, I think you'd be best off letting the debt go and set your sights on moving forward.

 

An ongoing consequence of the outstanding default may be that Capital One won't approve future applications for credit.  I leave it for you to determine whether that's sufficient incentive to repay, but in my book Capital One is one of the lesser desirable sources of credit once you have a prime credit score.

 

I mentioned the possibility of the account being submitted to a CA.  Because of the age of the account, this is now a toothless threat should they do this.  As noted, the account is too old to report either by C1 or a CA and they can't sue (or even threaten to).  Were you contacted by a CA about the debt, you can exercise your rights under the Fair Debt & Collections Practices Act and send the a "C&D" (cease and decease) letter that instructs them to refrain from further contact.  That legally stops them in their tracks.

 

I'm thrilled to hear that this albatross has dropped from your proverbial neck and that your credit score has recovered handsomely!

 

 

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