[Jessi]

I'm weighing my options on getting this old junk paid off...

Which is better? Pay off old debts first? Or should I work more on newer stuff? I'm planning on sending everyone SOMETHING, just trying to figure out how to divide it all up...

Once things start getting to zero balance, how long will it take to start seeing an increase in my credit score? I know it will be years before it's perfect, but I'd like to see them go up even a little..

[imkimssister]

Which is better? Pay off old debts first?

Hi! It depends on how old they are. You should first
check your dates, in case they are close to the seven year SOL on your credit report. They could be close to going away on their own. If thats the case, then you shouldn't worry with them. Unless your intent is to pay the whole amount off. Otherwise, if you start sending payments, it could 'renew' the date and the seven years will start all over again. Where as, if the time is close to being 'up', you'd be better off to let them go. THey will soon be off your report anyway- shirley

[Jessi]

So if I pay off the whole amount, it won't start things over, just if I make small payments?

[imkimssister]

Correct!!! Some creditors, after you make three payments in a row, will renew the debt and that will start your time table all over again. So if you're still a ways out on your SOL with the credit bureaus, then I would recommend you go ahead and pay it off, but not in installments. But if your time is almost up---you can make the decision whether to pay them or not, but if you do, make it in one lump so your time isn't renewed. shirley
Hope this makes sense.

Awesome...The last thing I want to do is keep this stuff going longer.

[Jessi]

Darn it, I forgot to log in. Ooops. It's too early.

[4u.bryan]

I would just like to remind you one thing. SOL and 7 year reporting time are completely different. As Shirley has mentioned above, after 3 or 4 monthly payments your creditors can renew the 7 year reporting time for an older debt. But the SOL (if already expired) restarts as soon as you pay a singly dime towards your debt.

No legal action is enforceable for a past SOL debt. Once the SOL clock is started again the creditor become viable to legal acts.

[imkimssister]

You're right Bryan, I forgot to state how the SOL are different between the two--which makes it even more important to check your time tables first before making a move. Shirley

[Jessi]

Ok, so definately don't pay on them if the SOL is 7 years or more, or close to 7 years. Most of mine are more recent though. And paying them in full instead of in payments is best...I'm getting this.

[4u.bryan]

Originally Posted by Jessica

so definately don't pay on them if the SOL is 7 years or more, or close to 7 years.

You got it right, however, the term SOL is not applicable here. You can say it this way: if the account is past 7 year reporting time or close to 7 year reporting time, it will be wiser not to disturb the system, let it go off automatically.

7 year reporting time is defined in Fair Credit Reporting Act. It is same for all the states.

SOL or Statute of Limitation is a particular timeframe after which no legal action is enforceable to collect a debt. This timeframe varies from state to state.

If you make any payment on a past SOL account, the clock is restarted automatically, but once the 7 year reporting time is over or the account is close to get off from your report, it does not restarted if you pay the balance in full. However, if you make some payment plan, then your creditor might set the 7 year reporting clock again.

Another thing I must include here, if any of your debt is past SOL or has gone off from your report, it does not mean that you are free from the obligation. It's still your debt and collectors can jump on it anytime.

[Jessi]

It would maybe be a good idea to contact each account first, and discuss it with them, if they will start the clock over, or not? Possibly make an agreement with them of some sort? I'd hate to keep things going, but I definately want to pay these things.

[Taquita]

If you have the cash to pay them in full, you might contact your creditors and see if they would settle for a lesser ammount - then you can pay off more of your debts at once. Just be sure if they agree to a settlement that they report the account to the credit bureas as either "paid" or "paid as agreed" NOT settled.

Good luck!

[Jessi]

That's a great idea, too...I only have one account that is fairly large, but if they would report it as "paid as agreed" that would be a lot better than "settled". I will have to be sure to get it in writing though, I don't trust these animals..lol