How Long Does Information Stay on My Credit Report
When it comes to maintaining personal finances, it’s important to understand how a credit report can be affected by negative information. A difficult time in life can continue to create hardships years if it remains in the file that lenders and other institutions use as reference. Find out how long different types of information stay with the report to gain a better understanding of reasons your credit score may be less than ideal.
Any time a company requests information from a credit report, an inquiry record is kept for a certain period of time. This includes instances that an account is reviewed for promotional inquiries that may not have been personally requested. Soft inquiries do not have a strong effect on the credit score, but it’s important to know that they will disappear in an average of a year or two. Hard inquiries made by a financial institution are used to determine lending eligibility in terms of a mortgage or loan. A few points will be deducted from the score each time, but it will gradually reduce until it falls off in two years time.
Filing chapter 13 bankruptcy hurts the credit report for no less than seven years, and chapter 7 extends even longer to ten years. The only reason chapter 13 is more lenient is that a part of the debt will be repaid rather than wiped away. Despite the impact of a Chapter 7 bankruptcy filing, a discharge will have a number of positive consequences that can make you more attractive to creditors. Since most Chapter 7 bankruptcies involve a discharge of tens of thousands of dollars of unsecured obligations, your debt to income ratio might improve dramatically.
Public Record (Tax Liens)
An unpaid tax lien may never disappear because there is no time limitation on the record, but they will drop off in seven years when the debt is satisfied. Judgments stay on the report for a total of seven years no matter if the debt was paid or not.
When an unpaid balance ends up in collections, it remains in the file for seven years, starting from the point it reached the past due status. The agency may agree to wipe the record if the balance is paid under an agreement, but it is necessary to obtain a record of the settlement in writing. Without a written agreement, a record of the collection will remain until the time has completely worn out. It’s important to also note that the seven years can start over anytime activity is made on the account.
Ten years from the date of last activity is how long the record of a good standing credit account remains. When they are not paid, it takes seven years from the past due date to drop off, even if it is simply a late payment. The positive account record still remains for ten years, even after the late or missed payment is dropped.
You can reach our office at 1-866-96-GMLAW to find out more about Bankruptcy Law and how negative marks can hurt a credit rating. Our experienced attorneys are ready to offer you credit counseling if you have fallen into debt.