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About Charged Off Amount on Your Credit Score

How are charged off amounts recorded on my credit report?

I have a charged-off account on my credit report for $2,761. A court judgment was made; now both accounts are reporting - one for $3,113 and $2,761 the $2761 is with interest which to $3113.can They report both accounts like this?

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Bill's Answer
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Bills.com | Find Learn Save

If I understand your question correctly, you have a single account appearing on your credit report twice, once as a judgment and once as a delinquent revolving account.

If this is a correct description, it is normal that the account is appearing on your credit report twice, because the two different listings represent different facts about your account status. The listing appearing as a "derogatory item" simply states that you have missed payments on the account, thereby causing the account to go into default. The judgment on the other hand shows that the creditor filed a lawsuit against you and won its case. Because the credit reporting agencies pull the information about the judgment from the public record files of your county court, the balance appearing on the judgment listing is static and possibly inaccurate. On the other hand, the listing showing up in the derogatory items section should be regularly updated by the creditor, which would explain why the balance appearing on one of the listings is $400 more than the other.

Interest continues to accrue on judgments, but the court itself does not keep track of the interest, so the balance of the judgment appearing on your report should be the same as the day the judgment was entered. The creditor, however, does track the interest accrual, and updates the account periodically, so the listing under you "derogatory items" will likely continue to grow until the judgment is paid off.

I understand your concern in thinking that both listings appearing on your credit report could make it appear that you owe twice as much money as you actually owe. To my understanding, credit scoring algorithms take this problem into account when calculating credit scores, so these two listings should not be damaging your score much more than is you had a judgment alone. The fact that a judgment has been entered against you is almost certainly damaging your credit score more than the delinquent account would be on its own. The only way effective way to resolve this problem is to contact the creditor and pay off the judgment. Once the judgment is paid, it should appear on your credit report as "satisfied," and the derogatory item listing should show a $0 balance. While your credit score will probably not improve immediately, satisfying this outstanding judgment is the first step to improving you credit history.

To learn more about credit, credit reports, and credit scoring, I encourage you to visit the Bills.com Credit Solutions and Resources page.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

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2 Comments

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  • 35x35
    Oct, 2007
    Nate
    If you have the notices from the collection agencies, you will need to contact them individually and workout a payment plan with them. If you do not have their contact information, you can most likely find the information on your credit report. You can get a free copy of your report at https://www.annualcreditreport.com/. You can also enroll in the services of a debt negotiation firm such as Freedom Debt Relief. Depending on who your creditors are, if you meet their eligibility, they might be able to cut your debt by almost 40-70% and get you debt free within 2 to 3 years. You can get a free consultation. If you fill in your information at http://www.freedomdebtrelief.com/ and a representative will get in touch with you to discuss your options for free.
    0 Votes

  • HM
    Oct, 2007
    Hattie
    How do I pay off credit cards and medical bills monthly that have already been sent to collection agency.
    0 Votes

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