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Benny123

paying Amex time barred debt

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Probably applying for a govt clearance soon so was checking in on debts, including possible time barred ones. Currently have a credit score of 800+ but did have a few past issues dating back more than 7 years ago.

Recently discovered a debt from Amex of about $300 that became time barred around 2001. It is no longer on the credit report, and supposedly the statute of limitations for collection has passed.

Apparently Amex doesn't sell debts to third parties, so this would supposedly have to be settled with the internal Amex collections department.

Willing to pay the $300 in full not just for the sake of the clearance, but just to get it resolved. However, will paying if off potentially cause issues?

First, can this debt/delinquency be reinstated in the credit report even though more than 7 years have passed? Supposedly the answer is no, since credit reporting for negative items ends 7 years after the first date of delinquency (probably around 1994) and cannot be changed, even if a payoff occurs. Just want to make sure though.

Second, this could restart the statute of limitations for collection, but will this be an issue if the balance is paid in full? That is, practically speaking, could and would Amex ask for anything more than the full $300? Just don't want to make matters worse by making a good faith payment.

What should a resolution letter include? Perhaps a note saying that a $300 payment ends the matter, but should something also be said about not reporting this to credit bureaus, although is this even an issue if the 7-year mark has already passed?

Side note: Some people have said that those with delinquencies are blacklisted by Amex from applying for future cards. Will paying this delinquency take someone off the blacklist? And since Amex supposedly backdates new cards to when first accounts were opened, could Amex report the payment on the deliquency since it would be recent (if Amex grants a request for a new account)?

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I am confused. How would anyone find out about this debt, if you didn't pay it at all? It isn't on your credit reports and there is no judgment on it. So essentially NOBODY knows about it besides you, Amex and whomever you tell about the debt to yourself. Am I missing something here? Do they check all kinds of things, and ask for all your credit transactions or something for this clearance you mention?

To answer your question, even if it did restart the debt collection clock (could possibly not even be reset by payment if you search current law. In Texas for example, time barred debt isn't revived by making a payment or acknowledging the debt) if you paid the debt in full then there is nothing to collect beyond your payment.

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