‘Re-aging debts’ is a method many consumers use to bring their credit history back on track.
In its most basic sense, by re-aging, you make your credit account status current, and your past history for that account is forgotten. Today, however, we will deal with one certain kind of debt, and that’s credit card debt.
Re-aging your credit card is beneficial as you will again be current on your payments and have ample time to maintain a good record of your account.
But will re-aging credit cards help you get a better credit score?
Financial advisors suggest that debtors go for debt management plans if they are too worried about their credit score.
When you do debt management, you will become current on your credit accounts. With this, your credit accounts will get marked as “on time”, and will be reported the same on your credit reports.
As you do this, you don’t have to get tensed regarding your credit score. Payment history is a big component of the credit scoring model, and the moment it gets current, your credit score will either shoot up or will remain intact!
How will you re-age your credit cards?
You can do that yourself or opt for credit counseling. It’s not easy, as creditors either do it out of negotiation or only if you can show that you have a good credit history with them in the past.
Here you should take my suggestion and enroll in a suitable debt relief process and let the professionals do the negotiation, while you sit and relax.
Whatever you do, you need to make at least 3 or more ‘on-time’ payments, to get approved for re-aging a debt, by a creditor.
Should you re-age your credit card debt for a better score?
I believe you should. But don’t expect to see your credit score rise in one day, as it will take time.
Remember, every debt has its own statute of limitations. In a rush, don’t re-age a debt that’s about to cross its ‘statute’. If you do so, then you will miss a big chance of getting your debt charged off.
Just try to re-age those debts that are going to stay with you for a long time.
This brings me to my next point.
What is illegal and/or negative re-aging of debts?
Till now, we focused on how to manage debts and get a good credit score with the help of re-aging credit cards, but there’s another aspect you should not overlook.
Many debt collectors re-age debts to make them look active and get more time to collect the debt from consumers.
By re-aging, they will reset the debt clock, and the period for the statute of limitations will begin all over again.
Usually, a collector can’t do that without informing you or with any help of fraudulence. It’s violating the FDCPA rules, you can sue them.
Hence don’t straightaway agree to anything a collection agency says or asks you to do. Be smart and, if required, let professionals handle this hassle.