How Long do Negative Items Stay on Your Credit Report

Most people have questions about how long negative items stay on your credit report, and there's a lot of misinformation floating around about different types of negative items. Here are a few of the most common negative items, and how long they may stay on your report:

How long do collections, late payments and other negative items stay on my credit report?
When a company sends your account to collections, reports payments more than 30 days late or any other negative information, these items stay on your credit report up to seven years. Both the creditor and the credit bureau can remove negative information from your credit report sooner than seven years. You can also have a negative item deleted from your credit report if the information contained in the item is inaccurate. In order to remove inaccurate information from your credit report, you'll need to file a dispute with the credit reporting bureau.

How long do bankruptcies and foreclosures stay on my credit report?
Foreclosures follow the 7-year rule, while bankruptcies stay on your credit report for up to 10 years. More specifically, Chapter 7, 11 and 12 bankruptcies stay on your credit report for 10 years, while Chapter 13 bankruptcy only remains on your credit report for 7 years after your discharge date. Bankruptcies and some criminal arrests are the only items that stay on your credit report for 10 years. While neither a foreclosure nor bankruptcy is good for your credit report, if foreclosing on your home can save you a bankruptcy, it's better in the long term to foreclose than to file bankruptcy. The foreclosure will be completely gone from your credit report 3 years sooner than the bankruptcy.

How long do credit inquiries stay on my credit report?
Credit inquiries may stay on your report up to 24 months. However, most banks only look at the most recent credit inquiries. If your credit inquiries are over 12 months old, they have a minimal impact on your credit report. If you have many credit inquiries simultaneously, a lender may be willing to overlook them if you're able to provide a good explanation, such as shopping for a car. However, those multiple entries could still lower your credit score, so even if a lender is willing to overlook multiple inquiries, try to avoid doing it. Especially when shopping for a car, get approved for an auto loan before you go shopping. Not only will you get a better deal than if you financed through the dealer, but you'll also avoid having multiple inquiries on your credit report.

What items are permanent on my credit report?
There are certain items that cause inquiries on your credit report that are not governed by a time limit. If you apply for a job with a salary of more than $75,000, there is no time limit to information reported in response to said inquiry. In addition, if you apply for more than $150,000 in credit or life insurance, that information also has no time limit on your credit report.

How long does a judgment stay on a credit report?
Judgments fall under the 7-year rule, UNLESS the statute of limitations on the judgment is longer than 7 years. Judgements are governed by whichever period of time is longer.

Why is the DOLA important?
The 7-year rule starts from the date of last activity on an account. Some creditors change the date of activity on their account to reflect more recent activity and re-start the 7 year time period for the negative item to stay on your report. This is a blatant example of inaccurate information. If a creditor is reporting an inaccurate date of last activity, file a dispute with the credit reporting agency. If you word your dispute correctly, you may be able to get the negative item deleted entirely as inaccurate. At worse, the creditor must report the date of last activity accurately.

How do creditors change the date of last activity?
One popular way in which creditors 'legitimately' change the date of last activity on an account is to sell the account to a new creditor. If that new creditor then attempts to collect a debt, the 7-year date may be reset to reflect the new creditor's debt-collection attempts. If a credit company sells your account and your date of last activity changes, report the creditor to the Federal Trade Commission and inform the creditor that you've taken this step. Usually, the threat of FTC involvement is enough to make the creditor remove the new DOLA information from your report, and may get the negative item removed entirely.

If you'd like more information about the different types of negative items or how you can dispute negative and inaccurate items on your credit report, sign up for our free credit secrets newsletter. Your credit will thank you.