A credit report can grow and strengthen over time, and when something bad happens, it will eventually heal. The duration of that healing process depends on the severity of the damage. Most negative information will remain on your credit reports for seven years with the one major exception being bankruptcies, which can stay on your credit reports for ten years.
Positive information can stay on indefinitely; however, most closed accounts that were paid as agreed fall off your credit reports after 10 years. As for specific items, like a missed payment or collection account, well, let’s take a deeper dive into how long stuff stays on your credit report
How Long Do Things Stay On Your Credit Report?
Here’s the bad news: If you make a mistake or run into financial obstacles that result in negative items on your credit report, those derogatory marks will remain there for years. The good news is they will carry less weight in credit scoring formulas as they get older.
Let’s take the dreaded credit score killer bankruptcy as an example. According to a study from FICO, a person with an average credit score of 680 could expect said score to fall around 130 to 150 points once a bankruptcy gets posted to their credit report. As we mentioned earlier, most bankruptcies can remain on credit reports for up to ten years. However, so long as that person doesn’t have any new negative information hit their credit file, they can expect to be back to that 680 in roughly five years, FICO says.
In other words (and this extends beyond bankruptcy), assuming you start instituting healthy credit habits, like making on-time loan payments and keeping low debt levels, your score won’t bear the brunt of a misstep for the entire time an item is on your credit reports.
Pro-tip: Post-bankruptcy, you’ll want to check that all the debts discharged as a result are reported that way on your credit report. And you may want to look into getting a secured credit card as a means to re-establish a good payment history.
How Long Does the Good Stuff Stay on My Credit Reports?To reiterate what we said earlier, any positive information on your credit report can remain there indefinitely. An account that was paid as agreed will likely be removed from your credit reports 10 years after the date of last activity.
What About the Bad Stuff?That varies. The Fair Credit Reporting Act (FCRA) explains the limits on reporting the different kinds of derogatory marks, though some of these limits vary by state law. Here’s how long incidents of negative credit history generally remain on consumer reports, as mandated by the FCRA.
How Long Do Late Payments Stay On Your Credit Report? Late payments can be reported for up to 7 years from when the delinquency occurred. Say you missed a credit card payment several years ago, and you still use that credit card. After that late payment is 7 years old, that delinquency legally cannot be included in the history of that account on your credit report. If the account containing late payment information is closed, the entire account will be removed after 7 years.
Pro-tip: If you miss a payment on accident, call your issuer to see if it’ll refrain from reporting it to the credit bureaus and/or waive the late fee. Most credit card companies will agree to do so if your payment history was stellar up until the misstep.
How Long Do Charge-Offs Stay On Your Credit Reports? An account you did not pay as agreed, like a charged-off credit card or installment loan balance, can remain on your credit report for up to 7 years from the date the debt was charged off. (A charge off is essentially when the creditor officially writes your debt off its books as a loss.) Keep in mind that just because a creditor has written off your unpaid debt as a loss does not mean you do not still owe the debt. Your creditor will likely sell your charged-off debt to a collection agency for pennies on the dollar, which brings us to another negative item on credit reports that we’ll get to shortly.
How Long Does a Foreclosure Stay On Your Credit Reports? A foreclosure can remain on your credit reports for 7 years from the date the foreclosure was filed. The same goes for a short sale, which could show up on your credit report as a charge-off, a settlement, a deed-in-lieu of foreclosure or “settled for less than the full amount due.” However it’s reported, a short sale is considered a derogatory event and can remain on your reports for 7 years.
How Long Do Inquiries Stay On Your Credit Reports?There are two kinds of inquiries, and only one hard inquiries hurts your credit scores. A soft inquiry, like an account review by your current credit card issuer, will show up on your credit reports but is not factored into your credit scores. Other examples of soft inquiries include you requesting your own credit reports or credit scores, promotional inquiries from companies that may want to sen
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