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| What is positive reaging? |
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Last Updated
6th of November, 2009
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Positive re-aging occurs when a creditor or collector brings an account that was delinquent to current status.
The official definition, from the Office of the Comptroller of the Currency, is the following:
“Returning a delinquent, open-end account to current status without collecting the total amount of principal, interest, and fees that are contractually due.”
This type of re-aging is designed to help customers who are making an effort get back on their feet after financial problems. Once you fall behind on a bill, it can be difficult to catch up. Unless you can come up with a large lump sum to catch up, your account may be reported as late every month, even though you are making payments. (These are called, “rolling lates.”) To prevent these types of accounts from being listed as delinquent every month, the bank or card issuer can re-age them so they are reported as current.
In this type of re-aging, an account that was reported as late each month to the credit reporting agencies will now be reported as “Paid on time.” Sometimes the financial institution will go back into the past payment history and bring all of the delinquent payments current. In other cases, the account will simply be listed as “Paid on time” for the current month and going forward.
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