Does it erase after 7 years?

Question

if i pay off all my debts that are in collections does it come off my credit report in 7 years? and does the 7 years start once debt is payed off or once you start paying on the debt?

If a pay the settlement amount will it still have a negative affect on my credit after 7 years?

Answer 1

Here is some information on an article I wrote back in December 2005

"How long will collection or other derogatory information stay on your credit report?"

Credit information can and usually stays on a person’s credit report for 7 years. You can use the information below as a reference to guide yourself and figure out how long derogatory information stays on your credit report

General credit information: 7yrs
Collections: 7yrs from date of last activity
Bankruptcy: 10 yrs
Foreclosure: 12 yrs from the date filed
Garnishment: 12 yrs from the date or entry or 7 yrs from the date satisfied
Judgment: 12 yrs from the date or entry or 7 yrs from the date satisfied
Tax lien: 12 yrs from the date or entry or 7 yrs from the date satisfied
Dismissed garnishments, judgments, and tax liens: not reportable

Now that you have this information I’ll give you an example similar to a client. The agent he had worked with before gave him the wrong advice.

Lets assume that you had a collection for $1,000 filed against you in December 1998 and you haven’t paid it. It’s now November 2005, so in a few weeks that collection can come off your credit report. (You will probably have to request all three credit bureaus to take it off your credit report). However, you just applied for a loan today and the loan officer tells you that you need to payoff that debt in order to be approved. Since you have the money to pay it off, you do so. Because the date of last activity is now November 2005, the collection will show on your report until November 2012 – another additional 7 years.

Now let assume that this collection was in June 2005 and you pay it off in November 2005 to obtain the loan, this will reduce your credit score. On the other hand if this collection was in September 2005 and you pay it off in November 2005 to obtain the loan, this will actually increase your score. My point is that a collection account that is less than 6 months old and is paid off will be beneficial but if your collection account is more than 6 months old and is paid off this will be detrimental to your credit score.

You as a consumer can request copies of your credit report from the 3 credit bureaus (although it’s better to get a collective report from all three in one which I can help you with) and dispute information that is incorrect. Incorrect information can be corrected or removed but correct information (good or bad) usually stays on the report for the period allowed. Only the credit grantor (lender/bank) or credit bureau can remove correct information.

If you find incorrect information on your report, contact the credit grantor obtain an explanation, have them corrected and ask them to contact all three credit bureaus and correct that information on your report. After this you should also contact all three credit with a letter with documented proof of the error on your report and ask them to remove this information. The credit bureaus by law have to respond to your letter and request. Depending on your case they might approve or deny your request but they have to respond to your letter. Following are the addresses for all three credit bureaus.

Trans Union
PO Box 4000
Chester, PA 19022
866-887-2673
http://www.transunion.com/

Experian
PO Box 2002
Allen, TX 75013
888-397-3742
http://www.experian.com/

Equifax Credit
PO Box 740241
Atlanta, GA 30374
800-685-1111
http://www.equifax.com/

Answer 2

Debts cannot be re-aged. They cannot report longer than the normal time limit from when you went delinquent, with the origianal creditor, and never caught up.

If you are planning on paying these I would first suggest finding out the statute of limitations for your state. Find out if the debt is still within the limitations. If it is not still in the limitations, you are not legally required to pay unless you want to.

If you want to pay, I would suggest first sending a debt validation to the collection agency, send it certified mail return receipt. After you receive the green card back, send a dispute to the credit bureuas, if it is reporting.

Then, when the collection agency validates the debt, send a pay for delete letter.

Request in that letter that, after payment, they will delete anything they have placed on your reports. Request to pay a percentage of the debt as a full payment. Request that they will not continue to collect the debt. Request that they will not sell the debt or a portion of the debt. Send that letter certified mail return receipt also.

For more information on how to deal with creditors, collection agency's and the credit bureaus, I would suggest going to the site I have listed.

Answer 3

The debt is purely no longer erased until eventually you contact them and ask for it to be erased. The 6 3 hundred and sixty 5 days time decrease in straight forward words applies in case you nevertheless stay on a similar deal with as once you took out the debt, or have cautioned them of any replace of deal with. once you've moved or replaced your call then they'd were attempting to the contact you, in which case the 6 3 hundred and sixty 5 days rule isn't desirable.

Answer 4

Depends on the country but generally personal bankruptcy is reported for the past 7 years and other entries (NSF, ETC) are reported for the past 3-4 years. To my knowledge nothing is erased, is just how far back the report goes.