A more important question might be: Why is the “Status of Accounts” so significant to my financial health?
The “Status of Accounts” section is viewed by lenders so they can assess your creditworthiness. It also enables them to determine how high (or low) a lending risk you are and how high (or low) your loan interest rate will be. Below we’ve listed some common credit report account statuses and what they mean. Try to keep an eye on the account status section of your credit report(s) at least once a year. You don’t want to be in for any surprises down the line.
Pays as Agreed
This can sometimes show as “paid as agreed”. If the account is in good standing or was closed in good standing, it will show on your credit report as one of these two statuses. When you “pay as agreed”, it means that your payments to this account have been in full and on time as per the terms of the agreement with the creditor. For a bank or other lender to consider you to be a low credit risk, this section must be very positive.
Paid/Closed Never Late
This status means that you have paid off this particular account in full, without any late payments, and the account is now closed. Reports sometimes show Paid/Closed orPaid/Never Late, which to FICO mean the same thing.
Closing a credit card account can lower your credit score a bit, but should onlyhave a significantly negative impact if the account was closed by the creditordue to non-payment or other payment issues.
Account Paid in Full for Less Than Full Balance or Settled
Typically referred to as a “settlement” or “resolution of the debt”, this occurs when a creditor accepts less than the full balance as payment-in-full. When a debtor stops paying and the number of days since the most recent payment reaches 120 days, the account is no longer considered current and the creditor is required to write-off the debt. This doesn’t mean the debtor is no longer responsible for the loan or that the debt is forgiven.
The creditor can transfer the debt to a “late accounts” department for
30 Days/60 Days/120 Days Past Due
If a scheduled account payment is missed by 30, 60 or 120 days, the lender
Once the late payment appears in your payment history, it will start to negatively impact your credit score. In addition, you can be charged a late fee almost immediately if you payment is 30 days late. After 60 days, your credit
There are many other account status terms used by the credit bureaus that can help you see what’s
At myFICO forums, you can read about other members’ experiences after seeing some of these account status terms on their credit reports… and how they handled them.
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