Highlights:
- If you fall behind on payments, your credit account may be sent to a collection agency or sold to a debt buyer
- You are still legally obligated to pay debts that are in collections
- Collections accounts can have a negative impact on credit scores
Past-due accounts that have been sent to a collection agency can be a source of confusion when it comes to your credit reports and credit scores. What does that mean? And if you pay off the accounts, can they be removed from your credit reports? We’ve broken down what you need to know.
What is a collection account?
If you fall behind on payments, the lender or creditor may transfer your account to a collection agency or sell it to a debt buyer. This generally occurs a few months after you become delinquent, or the date you begin missing payments or not paying the full minimum payment.
Typically, lenders and creditors will send you letters or call you regarding the debt before it is sent to a collection agency. You may not be notified if your account is being sold to a debt buyer, however. The collection agency or debt buyer will then attempt to collect the debt from you.
If your debt is sold to a debt buyer or placed for collection with a collection agency, you are still legally obligated to pay it. You may end up making payments directly to the collection agency or debt buyer instead of the original lender.
Is a collection account different than a charge-off?
A charge-off means the lender or creditor has written the account off as a loss, and it is closed to future charges. The account may still be sold to a debt buyer. Paying the past-due amount to the lender before it is sold may prevent a collections account from being reported on your credit reports (assuming the lender reports to one or more of the three nationwide credit bureaus). In this case, your credit reports may still have the charge-off account reported by your lender or creditor but may not have the additional account from the debt buyer.
What impact do collection accounts have on my credit scores?
A collection account may be reported to one, two or all three of the nationwide credit bureaus (Equifax, Experian and TransUnion) and reflected on your credit reports. It can also have a negative impact on credit scores, depending on the credit scoring model (different ways credit scores are calculated). Some credit scoring models may ignore debt collections for smaller amounts – if the original debt was less than $100, for example. Some credit scoring models may also treat different kinds of debt differently – for instance, medical bills versus delinquent credit card bills.
How long do collection accounts stay on my credit reports?
Like other negative information, a collection account can remain on your credit reports for up to seven years from the date you first miss a payment to the original lender or creditor.
What if I pay the debt?
If you pay the collection account, it should be reported to credit bureaus by the lender as paid, and would be listed as a paid collection. If you pay the account before the seven-year period is up, it can remain on your credit reports, but its effect on credit scores may lessen if it’s shown as paid, depending on the credit scoring model used. Some credit scoring models ignore paid collection accounts.
What if I believe the account information is inaccurate?
A good first step is to contact the lender or creditor. You can also file a dispute with the credit bureau that furnished the report where the account is listed. To file a dispute with Equifax, you can create a myEquifax account. Visit our dispute page to learn other ways you can submit a dispute.
If you have a past-due debt
If you want to avoid having an account sent to collections, contact your lender or creditor to see if they will work with you on a payment plan or other arrangements. If your account has already been sent to a collection agency or sold to a debt buyer, contact that agency or debt buyer to see if they can help with a payment plan or settlement amount.
The Consumer Financial Protection Bureau has more information, including information on negotiating a settlement.
FAQs
In English there are three articles: a, an, and the. Articles are used before nouns or noun equivalents and are a type of adjective. The definite article (the) is used before a noun to indicate that the identity of the noun is known to the reader.
What is an example of the articles? ›
English has two articles: the and a/an. The is used to refer to specific or particular nouns; a/an is used to modify non-specific or non-particular nouns. We call the the definite article and a/an the indefinite article. For example, if I say, "Let's read the book," I mean a specific book.
What are the 10 examples of articles? ›
Article 'A' :
- I'm a good boy.
- He's a topper.
- He was really a genius guy.
- He wasn't a mad.
- She is a painter.
- She is baking a cake.
- She's preparing a speech.
- They are going to buy a bugatti.
The Articles
- Article I. Legislative Branch.
- Article II. Executive Branch.
- Article III. Judicial Branch.
- Article IV. States, Citizenship, New States.
- Article V. Amendment Process.
- Article VI. Debts, Supremacy, Oaths, Religious Tests.
- Article VII. Ratification.
An article is a word that is often used at the beginning of noun phrases. There are three articles in English: Indefinite articles (a/an), definite articles (the), and the zero article.
What are the 10 examples of definite articles? ›
Examples
- The sun rose at 6:17 this morning.
- You can go anywhere in the world.
- Clouds drifted across the sky.
- The president will be speaking on TV tonight.
- The CEO of Total is coming to our meeting.
The 10 Best Academic Research Sources
- Google Scholar.
- JSTOR.
- Library of Congress.
- PubMed Central.
- Google Books.
- Science.gov.
- Digital Commons Network.
- ResearchGate.
The articles in English grammar are "the," "a," and "an." English has only one definite article: "the." This is used to refer to a particular person or noun: for instance, "the President of the United States." English has two indefinite articles: "a" and "an." These are used to refer to a non-specific noun: for ...
What are the 7 articles? ›
Articles of the Constitution
- Article I Legislative Branch.
- Article II Executive Branch.
- Article III Judicial Branch.
- Article IV Relationships Between the States.
- Article V Amending the Constitution.
- Article VI Supreme Law.
- Article VII Ratification.
The Six Articles upheld (a) the catholic doctrine of transubstantiation; (b) the view that one need not receive both bread and wine in the communion; (c) the obligation of priests to remain celibate; (d) the binding character of vows of chastity; (e) private masses; and (f) auricular confession.
Articles are words that come before nouns (or sometimes adjectives) to indicate meaning of the noun or clarify how specific the noun is. The most common articles are the, a, an.
When to use articles? ›
Article Basics
They are used with a singular countable noun when the noun referred to is nonspecific or generic. The article "the" is a definite article. It is used to show specific reference and can be used with both singular and plural nouns and with both countable and uncountable nouns.
Are there only 3 articles? ›
Articles are the smallest of the small but still serve an important function. We have three articles in the English language: a, an and the. The is the definite article, which means it refers to a specific noun in a group. A or an is the indefinite article, which means it refers to any member of a group.
What are the two main types of articles? ›
The English language has two main types of articles: definite and indefinite. The definite article the is used before specific, unique, or known nouns. The indefinite articles a/an are used before unspecific and general nouns.
What are the three articles in writing? ›
There are three articles in the English language: a, an, and the. They are placed before nouns and show whether a given noun is general or specific.
What are the first 3 articles about? ›
The first three articles establish the three branches of government and their powers: Legislative (Congress), Executive (office of the President,) and Judicial (Federal court system).
What are the three types of scientific articles? ›
Types of scientific articles include primary articles (original research articles, case reports/case series, and technical notes), secondary articles (narrative review articles and systematic reviews), special articles (letters to the editor, correspondences, short communications, editorials, commentaries, and ...
What are the different styles of articles? ›
Depending on its purpose, an article will most likely fit into one of four types: expository, persuasive, narrative, or descriptive. The type of article you are writing will also dictate your style and tone. Here is how these four types are commonly seen in business writing.
