What happens with Delinquent Accounts on my credit report?

Are there restrictions on when collections accounts can be posted on a credit report?

• I had a traffic ticket go into collections in October 2012.  I first learned of the collections account in December 2012, and at that time I checked my credit report to see if there was any impact. There were no collections accounts listed.  I fully paid the collection amount, and went on living life, thinking that the situation was solved.  The payment was accepted on December 27, 2012.  On January 25, 2013, a collections notice was posted on my credit report, showing a paid in full status, and an open date in October 2012.  This occurred ONE FULL MONTH after I paid the account in full.  My credit score has dropped from 780 to 660, and now I cannot qualify for the auto loan I was in the process of securing before this collections notice was listed.  I have never had a negative credit mark. I have been reading everything I can find trying to determine if there is a way this has violated reporting requirements, and if there is any way I can have this scrubbed from my credit report. I can't bear the thought of having such a low dollar claim cost me multiples of that value in interest on a loan. Any help would be greatly appreciated.

• Answer:

  You are in a bit of a situation here. Unfortunately even if you pay a collection, the collecting agency can still note your file. It is possible they already reported the collection as open to your credit report before you paid it. Then once you paid the collection they noted it as paid. This can be the case, even if you did not see if on your credit report before or after the incident.   Credit reports only get updated every 30 days, so if you didn’t see it initially that may be why.  It looks like you learned it the hard way, but when paying a collection it is very important you always get in writing that they will not report it to your credit.    The good news is that you can fix things…maybe.  I would start off by writing to the collection agency asking them to remove it. Doesn’t hurt to ask.   Then write each of the credit agencies Equifax, Experian and TransUnion and dispute the collection.  You can find out how to do this by a simple Google search. Just search “dispute letters” This process can take up to 30 days.    You should also go to http://annualcreditreport.comwhere you can pull your own report and dispute thing electronically.  Dispute the collection both electronically and via regular mail.   If that doesn’t work, hire a credit repair agency to help. I am not going to name any here, but there are companies that can get this taken care of for about $100 or so. It would be worth it. An approval on your truck or a lower rate and clear credit history is worth the cost of hiring a professional.   As a side note, see where the collection is being reported. It it on all 3 credit reports? If not you can actualy seek out an auto loan lender that pulls from a different agency. So if the collection agency put the bad mark on your TransUnion, find a lender that pulls from Equifax.  If you are not sure, Google it. There are online website that can give you hints as to what agency each lender uses.