Maybe you racked up credit card debt in college. Maybe you declared bankruptcy during a rough patch in your 20s. Whatever your credit mistake was, you are in a much better place now. You pay your credit card balances, have money in the bank, and have a stable job. Why, then, is your credit score still lower than you think it should be? I have bad news for you—it may be because some of your past mistakes are still on your credit report. In fact, most negative information stays on your report for seven years.
Negative Information On Your Credit Report
Anything that indicates your irresponsibility as a borrower is considered negative information. Some of the bad habits that will stick around include the following:
- Unpaid credit accounts. Any account you had that you failed to pay will remain on your report for seven years from the date the account first became past due.
- Late-payment history. If you had a credit account that you regularly paid late, a record of this will remain on your report for seven years. For revolving debt or installment debt, late payments may stay for 10 years.
- Collection accounts. If a past-due account is taken over by a collection agency and you do not pay them, a record of that will remain on your report for seven years from the date the collection account first became past due.
- Court judgments. If you were ordered by the court to pay a debt, that judgement will stay on your credit report for seven years, even if you paid it.
- Paid tax liens. If the government issued a lien on your property for unpaid taxes and you paid it, a record of this will remain for seven years.
- Unpaid tax liens. If you did not pay the tax lien, that will remain on your report indefinitely.
- Chapter 7 or non-discharged Chapter 11 bankruptcy. As a serious financial mistake, bankruptcy proceedings will remain on your record for 10 years.
- Discharged Chapter 11 bankruptcy. Once you have successfully discharged a Chapter 11 proceeding, it will remain on your record for seven years.
- Inquiries. Most inquiries from lenders or credit promotors do not affect your credit score, but will remain on your report for up to 12 months. Your own inquiries will remain for two years, but again, do not have a negative effect.
Paid credit accounts do not have a negative effect on your credit rating, but remain on your credit report for up to 10 years from the date of last activity.
Keep An Eye On Negative Credit Report Information
As I explain elsewhere on this site, the Fair Credit Reporting Act protects consumers from having false information on their credit reports. It also protects consumers from having negative information on their reports longer than it should be. If you are having problems getting bad information removed from one or more of your credit reports, contact me online for help. I have do-it-yourself tools and provide legal back-up if those fail! You can also call me directly at 415.802.0137 and I will do my best to make things right. I am waiting for your call!