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Five years ago I lost my job and had to fight my company over three months for unemployment benefits. I fell behind on my rent and was evicted from my apartment. I should have paid what I owed when my unemployment was approved however; I was irresponsible and chose not to. It did not matter to me at the time but fast forward 5 years and I now have a family and am experiencing firsthand how important credit really is. The past due debt (3k) was reported to the CRA’s in 10/2009-Should I wait another two years and let this fall off my cbr or would it be worth it to pay it off now? Help!

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Five years ago I lost my job and had to fight my company over three months for unemployment benefits. I fell behind on my rent and was evicted from my apartment. I should have paid what I owed when my unemployment was approved however; I was irresponsible and chose not to. It did not matter to me at the time but fast forward 5 years and I now have a family and am experiencing firsthand how important credit really is. The past due debt (3k) was reported to the CRA’s in 10/2009-Should I wait another two years and let this fall off my cbr or would it be worth it to pay it off now? Help!

Well, as your past landlord I say pay it! ;-)

 

It is possible a collection lawsuit could be filed to attempt to recover the money. If they are successful in the suit the costs to pay off the debt would likely increase. An adverse judgment is the typical result of a creditor prevailing on a lawsuit. A judgment limits one's options on how and when they "get" to repay.

 

I have no idea if a lawsuit is likely or unlikely in the circumstances described.

 

The CR is a separate issue. If I needed to qualify for a home bank loan ASAP then I am likely going to need to pay it off now. If I can wait until it falls of my CR then I might prefer to do nothing and hope I do not get sued.

 

I believe negatives can hang on a CR for up to 7.5 years. Other are more knowledgeable on dealing with CRAs. The statutes of one's state controls the statute of limitations/SOL. Often 6 years. SOL is a defense raised if someone sues after the 6 years (or the actual state SOL) have passed since the default event.

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The OP is in NC, the SOL is 3 years.  A suit is extremely unlikely (not impossible), but the SOL is an affirmative defense.  What you might do is contact the landlord and offer a PFD for a lesser amount than is owed, if your goal is immediately clearing this negative from your CR.  Personally, if I could afford to do that I would, but not for more than $1K.  And yes, I know that the conventional wisdom is a PFD is a last resort, but with a landlord as opposed to a CC issuer or JDB, it is far more likely to be effective, and would be the quickest way to get the item removed.

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Is the amount listed from a CA or the landlord himself ?  If a CA do NOT pay it.  They may no longer even own the debt.

 

I too believe it would be in your best interest to work out something with the landlord at a reduced cost, NOT the full amount.  ONLY if they agree in WRITING to delete from ALL 3 CRA's.

 

Good luck.

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