Delinquency stays on the record for 7 years, but its negative power declines with time. Its power declines in any case, but the 7-year countdown for removing it from the record may not start until the delinquency is paid. If your delinquency was old, its significance had been weakened with time. When you paid it, you made the item current (i.e. strong) again. Delinquency always counts as a negative factor, paid or unpaid, so your score dropped. That is why it is recommended to pay such debts off as soon as possible thus giving the score enough time to heal up before you shop for a loan.
