I wanted to share this information as it is a very common question amongst our client, read up to get a little more knowledge on these types of accounts.
Delinquencies remain on your credit history for seven years, even after a loan has been settled or paid in full. If your mortgage account was charged off and then settled, the account will remain on your credit report for seven years from the original delinquency date, which is the date the account first became delinquent and was not brought current. Therefore, if your account was written off in 2015, it will remain on your report until 2022. The date the charge-off was settled will not change when it is removed.

Settling an Account vs. Paying It in Full

Although the balance is brought to zero, settling an account instead of paying it in full is considered negative because the creditor agreed to accept less than what they were owed. Even if all your payments had been made on time leading up to it, settling an account is likely to hurt your credit scores. Still, settling an account is always better than not paying a debt at all. Many lenders will require that any outstanding debts are paid or settled before they will consider approving you for a new loan.

How Can I Improve My Credit After Defaulting on a Loan?

A charge-off is considered derogatory, so it can take time for your credit to recover once it occurs. The first step to improving your credit scores after a serious delinquency is to bring current any past-due accounts. Next, you’ll want to:

In time, lenders and credit scoring models will see that you are managing your credit responsibly, and your credit scores will begin to reflect that. Each lender still maintains their own criteria for approving applications, however. In your case, it sounds like your lender is concerned that the charged-off account still had an outstanding balance within the past four years. Some lenders may require that a certain amount of time has passed since an account was past due before they are willing to extend credit.

If you’ve been declined for a loan and want to know how to begin improving your creditworthiness, consider ordering a free credit score from Experian. You will receive a list of the risk factors that are currently impacting you the most. While you may not be able to remove old delinquencies any sooner, improving on other risk factors can help you increase your credit scores in the meantime.
If you have had issues with negative accounts getting re-aged and not getting deleted from your credit report, we can help with all your cre4dit and debt needs. Please give us a call, we can guide you as to how to handle these.

A Goal without a Plan is just a Wish. Give us a call TODAY at 844-FIX-URCR or click on the following link creditservicesofamerica.com to schedule your FREE consultation and create your personalize plan to achieve your credit and debt GOALS!
*Individual results may vary. Please call for details and to discuss your own individual situation.