Late payment information on a credit report stays on for a period of seven years from the date that it was first reported even if the account is paid off and closed or made currents by regular payment. The entry in the credit report will show by how many days the payment was late. The reason why a credit report continues to hold information about your payment history in the past is that the payment behavior of the consumer is also a factor that represents the credit lending risk. Lender likes to evaluate the creditworthiness of a potential borrower from the trend of payments that he has shown in the past.
She this does not in any way means that you should not pay off your debt because that will result in the account being reported as delinquent which has the worst effect on your credit score and the decision-making process of your lenders. If the account is charged off and passed on to a collection agency then a new collection account will be opened in your credit report which also has a severe effect on your credit report.