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I'm 32 years old, make just under $50k/yr. I have $25k-$35k in roughly 5 year old debt. I have been living the last five years (barely) within my means. No new debt. I have the print out from a Feb 2012 credit report. I am recently engaged. First, as I understand it all the items on my credit report are eligible to drop off the report 7 years after I last made payment. Most of the debt was credit card debt, with maybe a couple or few hundred from PG&E and a hospital bill. In all cases last payment was roughly 5 years ago. How do I know the actual date they'll come off my report? There is a column on my report that includes Payment Terms, Account Type, Past Due Amount, and Last Activity. Is Last Activity the date I'd add 7 years to? The only other date related information is a column with Date Opened and Date Last Reported. Second, my fiance and I are planning to wait roughly 2 years before we get married (a decision unrelated to my debt situation). Her credit is good. I understand that when we marry our financial responsibilities will merge, which I assume means she'll take on responsibility for my old debts. We're already planning on waiting roughly as long as I think it'll take for my debts to clear but I'd like to know how important it is (if at all) for us to wait until that has happened. What do I need to know?
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Jun 4, 2014 22:29
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| # ? Apr 23, 2024 22:16 |
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EngagedToDebt posted:I understand that when we marry our financial responsibilities will merge, which I assume means she'll take on responsibility for my old debts. This is incorrect. You can get married tomorrow and she won't become party to your debts.
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Jun 4, 2014 23:14
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Well that's nice to know! I guess it makes most of the question moot. To be clear, if we were to marry and she ran her credit report it would look the same as it does now? I'd still love to hear how to figure out when stuff falls off my report, though.
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Jun 4, 2014 23:23
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The way this reads, you never paid off the debt, and have basically just stopped paying/defaulted on it? When you say the last payment was 5 years ago, do you mean you cleared the debt 5 years ago, or you just stopped paying? Because unless you declared bankrupcy or something that debt may still be out there. It just doesn't "disappear" after 7 years. Sorry if that's a condescending question, but I've seen people before just assume that debt "went away" after 7 years if they ignored it.
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Jun 4, 2014 23:32
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I just stopped paying. No bankruptcy. I'm not suggesting that the debt stops being owed, more that it stops showing up on a credit report. After 7 years all (non government, non judgement) debts cannot be reported on a credit report according to US Federal law. E: Though I guess I was viewing them as essentially equal, in my mind...
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Jun 4, 2014 23:51
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If your FICO score were the only possible consideration for loan eligibility, your plan would be perfect!
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Jun 5, 2014 00:02
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at the date posted:If your FICO score were the only possible consideration for loan eligibility, your plan would be perfect! A useful, informative post!
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Jun 5, 2014 00:05
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EngagedToDebt posted:A useful, informative post!
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Jun 5, 2014 00:08
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When my husband and I bought a house together (in 2010) they took both our incomes into consideration but based our mortgage rate on whichever credit score was lower (which was his, not by a lot but enough to keep us from getting the absolute best rate). If your score is garbage, it might come back to haunt you if/when you ever buy a house together.
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Jun 5, 2014 00:18
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moana posted:It really is, since you seem to think that not having your debt show up on a credit report means you don't have the debt! You still do! Unless you declare bankruptcy! Look, I'm here for help and information. Obviously I don't know what's what. at the date's post was meant to mock and while it (rightly) says I don't know about loan eligibility it also didn't give helpful or useful information beyond stating my ignorance. The internet is full of websites that point out that debts drop off your credit report after 7 years and leave it at that with no mention that the debts can come back to bite you or how. Maybe I'm asking the wrong questions. I had never "planned" to just let the debt disappear; I ignored. Now I find myself in a situation where I'd rather not hurt someone else based on my own lack of responsibility. The debts are close to disappearing from my credit report and I'm beyond the statute of limitations to be sued for them. In all seriousness, because I obviously don't know, how can old unreportable and unenforceable debt hurt me? What do I need to know?
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Jun 5, 2014 00:43
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Until you pay it off or declare bankruptcy, the debt can still be collected. Has it been sent to collection yet? Have they sued you?
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Jun 5, 2014 00:59
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All the debts were sent to collections years ago. None of the original creditors or collections agencies sued me. All the debts are over 4 years old. I live in California where the statute of limitations for suing for a debt is 4 years after the original delinquency date.
EngagedToDebt fucked around with this message at 01:06 on Jun 5, 2014 |
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Jun 5, 2014 01:02
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You will owe the debt unless you declare bankruptcy. Your fiance will not. Even if everything drops off your credit report you still owe the money, and the collectors can still harass you but it's easier to ignore them then, I guess. Do you owe the IRS money? that's a different ballgame. If you still owe them money after you get married and file taxes jointly then they will withhold any refunds you and her are due for subsequent tax years. Sounds like you don't owe them anything though. Did you live in California when you entered into all of the agreements for the debt you owe? Because if you entered into agreements in another state they can possibly use the laws in that state to collect the debt. In some states the statue of limitations for suing for debt collection is 10 years or more. IIRC your debt should drop off your credit report 7 years + 180 days after the point in time they became "past due." So for each debt you have, you can ballpark the "drop-off" date by figuring out when they first sent you a "Due Immediately" notice, then adding around 7.5 years to it.
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Jun 5, 2014 14:52
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All debts were entered into in California. No money is owed the IRS. Can anyone elaborate on at the date's informative zinger? If the only outcome of continuing to not pay these is I continue to occasionally get a robocall then I'm finding it hard to care. If I won't be able to buy a house or get a car loan because of it then it is obviously a different story.
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Jun 5, 2014 16:09
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Someone with more knowledge will have to speak to this, but I'd have to imagine that your outstanding debt will ultimately come back to be a problem. Especially if you and your wife-to-be enter into a loan together. You keep referencing time as an attribute of the collections. The debt itself should still stand regardless of how long.
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Jun 5, 2014 16:25
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There is a debt collectors megathread like halfway down the first page of this forum.
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Jun 5, 2014 16:28
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Nail Rat posted:There is a debt collectors megathread like halfway down the first page of this forum. Specifically this thread: http://forums.somethingawful.com/showthread.php?threadid=3234974 Read it!
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Jun 5, 2014 16:37
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Any mortgage application will probably ask you about any debts that you have, regardless of what is on your credit report. I can't remember. Maybe an underwriter can chime in? Probably don;t want to misrepresent yourself on that. Otherwise, a collector will almost always create a new collection account for credit reporting in your name when they buy your debt, and that can ding you. They aren't supposed to do this past the 7.5 year initial collection date I think, but they do anyway. Then you have to talk to them to get it off and they will use it to their advantage. Also, I forgot to mention this earlier, the OP should look at the laws in CA regarding resetting the statute of limitations... I think in some states the SOL is set from the last time you made a payment on the debt, even if it was made "past due" earlier. So for example if your account was sent to collections 5 years ago, but you made some payments up until three years ago, then there is only three years on the clock and in a 4 year SOL state they can still sue you. Edit: Yeah read the Megathread
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Jun 5, 2014 16:38
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You seem concerned if there will be any cost to your fiancée, so I'll just throw this out: If you any of the debts are written off you may (see pg. 88) need to include them as income on your tax return, so if you do file jointly, she may then be also liable for those taxes. Keep that in mind if you start to receive 1099-Cs.
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Jun 7, 2014 04:31
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Uh, the OP of the debt collection thread is basically "I fought the debt collectors in court and so can you!", which does not really seem like it's the kind of helpful information you guys are alluding to. I assume the actual useful info about the various impacts that outstanding debt can have on you is buried in the 68 pages somewhere?
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Jun 9, 2014 00:45
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Pay off the old debts. Get that poo poo cleared up so you and your fiance can start with a clean slate. The creditors can shuffle around your ancient debt and keep it popping up on your credit report for years to come. The smart thing to do is to pay it all off, especially if you can get a lowered settlement since it's old bad debt. Don't give them electronic access to your checking account and get everything in writing. You may be able to settle up with them for a fraction of the original debt and get this poo poo cleared. Waiting on stuff to drop off your report isn't a wise way to handle your finances.
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Jun 9, 2014 18:48
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CuddleChunks posted:Waiting on stuff to drop off your report isn't a wise way to handle your finances. Actually for him it probably is the smartest thing for him to do right now. From a credit reporting standpoint the worst thing he could do is re-age 5 year old, past SOL debt and start the 7 year reporting clock again. As of right now his credit reporting slate will be clean in about 2 years, resetting that clock for an additional 5 years makes no sense. He's past SOL, so he can't be sued in court for the debt, meaning no judgements or garnishments, so his income won't be affected. They can still call and send letters, but on 5 year old debt that's been sold a half dozen times it probably isn't happening too often right now. The worst thing that can happen at this point is the debt is forgiven and he's issued a 1099-C and has to pay taxes on the defaulted debt.
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Jun 9, 2014 21:06
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skipdogg posted:Actually for him it probably is the smartest thing for him to do right now. From a credit reporting standpoint the worst thing he could do is re-age 5 year old, past SOL debt and start the 7 year reporting clock again. Fair enough.
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Jun 10, 2014 00:46
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| # ? Apr 23, 2024 22:16 |
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For 25-35K in debt, I would speak to a lawyer, specifically someone who specializes in debt collection and contract law. It will cost you 250-500, but it will be worth it to discover if the SOL actually applies to the debt and what the effects going forward will be. I've seen people misuderstand how SOL works for their state and then get surprised by a lawsuit out of the blue.
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Jun 17, 2014 18:17
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