The vast majority of both positive and negative information stays on your credit reports for no longer than seven (7) years from the date that activity on the account ceases. This can mean that the account has been closed or paid in full. Accounts such as credit cards and mortgages can stay on a credit report for well past seven years because those types of accounts commonly remain active for many years. There are, however, some notable exceptions to the "seven year rule", Chapter 7 Bankruptcies - These will stay on your credit reports for up to 10 years from the filing date. Interestingly, the accounts that are included in this type of bankruptcy will have been removed from your credit reports years before the actual record of filing chapter 7 is removed. Unpaid Tax Liens - These will stay on your credit report indefinitely. Yes, indefinitely. The only exception is in California where state law requires that they be removed no later than 10 years from the date it was filed. Defaulted Student Loans - The 7 year rule does not apply to defaulted student loans that are government issued or guaranteed. These items can also stay on your credit report indefinitely. So how can you be sure that these items will be removed when the time has come? Each of the credit bureaus hard codes their credit reporting systems to look for the "purge from" dates. As these dates hit their 7 or 10 year anniversary they will automatically be removed. Unless you feel that the account has aged past its reporting time limit, there is no need to remind the credit bureaus that an item is to be removed. It is done automatically. SPECIAL NOTE ABOUT COLLECTIONS: Collection agencies will often report debts to the credit bureaus in an attempt to collect from the consumer. This is perfectly legal as defined by the Fair Debt Collection Practices Act. The issue here is that, intentionally or not, collection agencies commonly report to the credit bureaus using a newer "purge from" date despite the fact that this is not allowed according to sections 605a4 and 605c1 of the Fair Credit Reporting Act. The result of this misreporting is that the collection item will remain on the credit file for greater than 7 years. If you feel that you have a collection account that has been reported for more than 7 years from the date your creditor began sending you collection notices you should contact the credit bureaus and dispute the account as "outdated."
Posted on: Wed, 25 Sep 2013 16:59:15 +0000
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