Re-aging, in the world of consumer credit, has a very nasty meaning. To re-age means to change the “purge from” date on a derogatory account. What this means is the negative account likely will remain on the credit reports of the consumer longer than the allowable time, which is seven years in most cases. Every negative account, whether it’s a collection, credit card, auto loan, or any other, has to have a date that the credit bureaus will use to calculate the seven years for removal. This date is commonly referred to as the “purge from” date. The account is purged seven years from that date.
What this means is that it’s critically important that the “purge from” date accurately reflect when an account went severely past due. If it does not, the credit bureaus will report it longer than seven years, but not maliciously. This brings up a very sensitive topic that seems to have taken on a life of its own: re-aging. There is belief, and some proof, that re-aging exists in the world of collections.
Now, re-aging can be intentional (willful) and it can be unintentional (negligent). The bottom line is that IF it does happen, it doesn’t really matter WHY it happened; it can still cause a collection to remain on a credit file longer than allowed by federal law. Some people believe that re-aging is an intentional attempt to keep a collection on a credit report longer. This is illegal – very illegal, in fact. It’s a Fair Debt Collection Practices Act (FDCPA) and a Fair Credit Reporting Act (FCRA) violation and can lead to lawsuits against the collection agency.
Have I ever actually seen an example of re-aging? No, I have not. I’ve seen examples of collections that have other dates updated to reflect new payments or other activity, but I’ve never actually seen a “before and after” picture of the same collection with two different “assignment” dates. Does that mean it doesn’t happen? No, it just means I’ve never seen an example that I believed reflected re-aging.
The date when the seven-year reporting period begins is the same date when the account goes 180 days delinquent with the original creditor. This is what the Fair Credit Reporting Act says. If you have a collection that does not reflect the dates accurately, contact the credit bureaus and challenge the accuracy of the account. Hopefully the collection agency will realize the mistake and correct the error. If they will not correct it, you might have to get more serious about corrective actions.
John Ulzheimer – Credit scoring and credit reporting expert and author, John is the President of Consumer Education for Credit.com. Formerly with Equifax and Fair Isaac, John shares his unique insight of the inner workings of credit scoring models and the credit reporting industry on CreditBloggers.com.
John Ulzheimer Formerly with Equifax and Fair Isaac, John shares his unique insight of the inner workings of credit scoring models and the credit reporting industry on Credit.com News & Advice.
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Re-Aging collections:. I’d be interested to see if you get an answer to your question Matt…am dealing with this issue now
I have experienced a re-aging on an auto loan that went default. We were forced to claim bankruptcy about 15 years ago and upon completion of the filing, we took a snapshot of all of our credit reports. After the seven year requirement, we started notifying the credit bureaus to remove the negative accounts. The auto loan, owned by a Major bank in Seattle, had its default date changed about six months prior to the bankruptcy being satisfied. I contacted the credit bureaus with the before and after but they wouldn’t take action unless they recieved an order to do so from the bank. I had to call the bank and threaten them to take action. The matter was fixed within a few weeks. I never did report them and should have. So…it does happen but the consumer is not informed well enough on how to take action.
Thank you for writing this, it’s very helpful. I am dealing with a collection account currently that is reporting 90 day lates in 2010 when the account is years old. Not only that but I settled with them in 2010 after them having no success for years to collect the money. Now I pull my reports for a pre-approval and am seeing 90 days lates from the beginning of the year to months beyond when I paid them. I have tried contacting the collection agency and they told me I could get a letter showing it’s paid but nothing verifying that these arent correct. I really need to know what to do and how to proceed. I cant buy a house without these letters and these things corrected. Please Please help!