The Collections Section, Decoded

When a debt goes unpaid long enough, the creditor may charge it off and sell or assign it to a collector. Collections appear as their own tradelines, and newer scoring models treat paid and medical collections very differently from unpaid ones.

Why it matters

Collections are where most people panic or pay blindly. The rules changed recently: knowing which collections still matter - and which no longer count - decides what to handle first.

Key facts

• Paid collection accounts are ignored entirely by FICO 9 and VantageScore 3.0 and 4.0.
• Medical collections under $500 no longer appear on bureau reports as of 2023, and paid medical collections were removed too.
• The bureaus require a 180-day waiting period before medical debt can be reported, giving insurance time to pay.
• A charge-off and a collection can both appear for the same debt; paying the collector does not remove the original charge-off.

In practice

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