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There are countless tips, strategies, and tricks available to you when searching for Credit Repair. Here is another one…

When thinking paying off past charge off or collections accounts, keep in mind that may not be the best thing for your credit. The good thing is you’ll have a “paid” on that account on your credit report, but the account still says “paid collection” or “paid charge off” or several other similar terms, which is NOT what you want. Believe it or not, that’s still a negative on your account.

Follow me here, when you have any activity on your credit report, that particular activity usually does not “drop off” your report for 7 years (sometime 10 years depending on the situation). The 7 year clock, so to speak, begins at the point of the last activity on that particular account, not when the account was opened or placed in collection or charged off.

In other words, let’s say you have an account that has been charged off on your credit report. The account has had zero activity for 4 years. You’ve recently came into some money and you want to pay off all your past debt, which is a very noble thing to do. You think that by having a zero balance on that particular account, it will help your credit score. That’s not always true. Keep in mind, that creditor has already charged the account off. In their books, that debt is gone. The only record the account existed between you and the creditor is on your credit report.

You come along and pay that outstanding charged off account. The creditor says “thank you very much” and then the words “paid charge off” is applied to your credit report and that account stays on your credit report for another 7 years! Get it? The 7 years started over as soon as there was activity again on the account.

If your goal is to raise your credit score, paying off old charge off accounts may not be the way to do it. Again, it may be a noble thing to do, but do you still want it haunting you for another 7 years? Something to think about.