Paying off a defaulted debt ...

[Stu]

Searched the web but can't really get the answer...

A defaulted debt that is nearly 5 years old on the credit file but I know I owe the money and want to pay it off but my question is when I contact the DCA and pay it do they remove the default from my credit file or is this something that has to be negotiated with the DCA or not even possible at all and it remains for it duration even after paying it off ...

[Amethyst]

Re: Paying off a defaulted debt ...

No they don't remove the default, they just mark the debt as settled, and will remain for the next year or so and will falloff at the 6 year from default point ( as it would if you left it unpaid).

If you are looking into getting a mortgage though it does help to have any defaults marked as settled.

[Stu]

Re: Paying off a defaulted debt ...

Ok thanks Amethyst

[starfly]

Re: Paying off a defaulted debt ...

I have just paid off an outstanding debt ( which showed up as a default on credit file). Once the debt has been settled, does it still carry on affecting credit rating until it has fallen off until 6 years?

Or can I expect to see better scores over the coming months? 😀

[Stu]

Re: Paying off a defaulted debt ...

It will affect your rating until it drops off regardless of it payed but lenders might look more favorably at it saying satisfied ...

[nemesis45]

Re: Paying off a defaulted debt ...

I have just paid off an outstanding debt ( which showed up as a default on credit file). Once the debt has been settled, does it still carry on affecting credit rating until it has fallen off until 6 years?

Or can I expect to see better scores over the coming months? 😀

Debts that are showing as defaulted on credit files and then paid will be marked " satisfied or partially satisfied" depending if they are paid in full or paid partially under a full and final settlement.

Your " credit score" may change but much will depend on the other entries on your credit files.

nem