The length of time that negative information can remain on your credit report is governed by a federal law known as the Fair Credit Reporting Act (FCRA). Most negative information must be deleted after seven years. Some, like a bankruptcy, stay for up to 10 years. With regard to the specifics of derogatory credit information, the law and the deadlines are more nuanced. Here are eight types of negative information and how you might be able to avoid any harm each might cause.
Key points to remember
- The Fair Credit Reporting Act (FCRA) governs how long negative information can remain on your credit report.
- Most negative information stays on your credit report for 7 years; some elements remain for 10 years.Inasmuch asInasmuch as
- You can limit the damage caused by derogatory information even if it is still on your credit report.
- Removing a negative item from your credit report does not mean that you no longer owe the debt.
Difficult investigation: two years
A hard ask, also known as a hard ask, is not necessarily negative information. However, a request including your full credit report deducts a few points from your credit score. Too many difficult requests can add up. Luckily, they only stay on your credit report for two years after the date of the inquiry.Inasmuch asInasmuch as
Limit the damage: Group difficult requests, such as mortgage and car loan applications, over a two-week period so that they count as one request.
Delinquency: seven years
Late payments (usually more than 30 days late), missed payments, and collections or accounts that have been turned over to a collection agency can remain on your credit file for seven years from the date of default. payment.Inasmuch asInasmuch as
Limit the damage: Make sure you make your payments on time or catch up. If you are usually current, call the creditor and request that the default not be reported to a credit reporting agency.
Charge-Off: seven years
When the creditor cancels your debt following non-payment, it is called write-off. Charge-offs remain on your credit report for seven years plus 180 days from the date the charge-off was reported to a credit reporting agency.Inasmuch asInasmuch as
Limit the damage: Try to repay all or a negotiated amount of the debt. The ding to your credit won’t be removed, but you probably won’t be prosecuted.
Student loan default: seven years
Failure to repay your student loan stays on your credit report for seven years plus 180 days from the date of the first missed payment for private student loans. Federal student loans are terminated seven years after the date of default or the date the loan is transferred to the Department of Education.Inasmuch asInasmuch as
Limit the damage: If you have federal student loans, take advantage of Department of Education options, including loan rehabilitation, consolidation, or repayment. With private loans, contact the lender and request a modification.
Foreclosure: seven years
Foreclosure is a form of default that involves your lender taking ownership of your home for failure to make timely payments. This stays on your credit report for seven years from the date of the first missed payment.Inasmuch asInasmuch as
Limit the damage: Make sure you pay your other bills on time and follow the steps to rebuild your credit.
Tax liens and civil judgments should not appear on your credit report.
Prosecution or judgment: seven years
Paid and unpaid civil judgments remained on your credit report for seven years from the date of filing in most cases. By April 2018, however, the three major credit reporting agencies, Equifax, Experian and TransUnion, had removed all civil judgments from credit reports.Inasmuch asInasmuch as
Limit the damage: Check your credit report to make sure the public records section does not contain information about civil judgments, and if it appears, request that it be removed. Also, be sure to protect your assets.
Bankruptcy: seven to ten years
How long bankruptcy stays on your credit report depends on the type of bankruptcy, but it usually ranges between 7 and 10 years. Bankruptcy, known as the “credit score killer,” can lower your credit score by 130 to 150 points, according to FICO. A completed Chapter 13 bankruptcy that is discharged or dismissed typically exits your report seven years after filing. In rare cases, Chapter 13 may remain in effect for 10 years.Inasmuch asChapter 7 and Chapter 11 bankruptcies expire 10 years from the filing date, and Chapter 12 bankruptcies expire seven years from the filing date.Inasmuch asInasmuch asInasmuch asInasmuch as
Limit the damage: Don’t wait to start rebuilding your credit. Get a secured credit card, pay non-bankrupt accounts as agreed, and only apply for new credit once you can manage the debt.
Tax privilege: once indefinitely, now zero years
Paid tax liens, like civil judgments, were part of your credit report for seven years. Unpaid liens could remain on your credit report indefinitely in almost all cases. In April 2018, the three major credit reporting agencies removed all tax liens from credit reports due to inaccurate reporting.Inasmuch asInasmuch as
Limit the damage: Check your credit report to make sure it does not contain tax lien information. If so, challenge the credit agency to have it removed.
Once the credit reporting deadline has passed, the negative information should automatically disappear from your credit report. If this is not the case, you can dispute it with the credit agency concerned, which has a period of 30 days to respond to your request. If the item in question contains errors, you can dispute it and request that it be removed before the deadline expires. Also, if you need to have a negative mark removed from your credit report and you can’t wait for it to expire, one of the best credit repair companies might be able to help.
Keep in mind that the expiration of a credit reporting deadline does not mean that you no longer owe the debt. Creditors and collectors can continue to pursue payment if the debt remains unpaid. However, if the debt is outside the statute of limitations of the state where the debt arose, the creditor or collection agency may not be able to use the courts to force you to pay.