How long does a collection stay on a persons credit report?

Question

My fiance and I got in a little disagreement a little while ago about how long collections stay on a credit report.

He says that after 7 years they will be removed from a persons credit report - whether they are paid or not.

I disagree with that. Why would collection agencies just "give up" trying to collect money from a person and take it off a persons credit report. It doesn't make sense to me. If collection agencies just stopped trying to collect from a person after 7 years wouldn't a lot of people not pay their bills because it will just go away after 7 years?

Can someone clarify this for me? Thanks!

Answer 1

I'd be glad to clarify!
Collections stay on your credit report 7 years after the date of last activity. Don't let this confuse you...normally 7 years after date of last activity means the date that it was sold to the collection agency. Usually your account must be 180 days past due in order for the company to do that. Basically, I'm saying that the collection stays on your report 7 years and 6 months. After that, it will fall off your report.
Now, to get to your question, the collectors don't just give up and stop trying to collect the debt. Legally, they are still entitled to their money since they were not paid as agreed. They can attempt to collect that debt forever, if need be. You're right. Many people would just wait out the 7 years and start all over if that was the case. Cheaper than bankruptcy, no?! But that debt will follow someone until it is settled or paid.

Answer 2

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RE :How long does a collection stay on a persons credit report?
My fiance and I got in a little disagreement a little while ago about how long collections stay on a credit report.

He says that after 7 years they will be removed from a persons credit report - whether they are paid or not.

I disagree with that. Why would collection agencies just "give up" trying to collect money from a person and take it off a persons credit report. It doesn't make sense to me. If collection agencies just stopped trying to collect from a person after 7 years wouldn't a lot of people not pay their bills because it will just go away after 7 years?

Can someone clarify this for me? Thanks!
5 following 10 answers

Answer 3

Disputing a debt does not restart a clock. Doesn't matter if an old debt that's minus 7+years now shows an "updated" date. Clock still starts from last date of payment, which will be indicated on your credit report. So ignore the "udpdated date." As for collecting past 7+years when your debt legally falls off the credit report, that is a violation of the federal collection act. Bottom feeder collection agencies will buy these for pennies on a hundred bucks. If they harass you or repost on your credit report, contact a consumer protection lawyer (it's free) and they will sue the snot out of the bottom feeders. You usually end up with a hundred bucks, too. Trust me, there's a lot of collection agencies that do illegal things all of the time until you sue them and put an end to it.

Answer 4

Just because it is not on your credit report does not mean the debit has gone away. It means for most practical debits, they have been charged off as bad debits and taken off the lenders taxes; but that does not mean they won't still collect.

Some collections stay a lot longer. IRS liens, state tax and owner's association dues can stay or be renewed in some states for up to 20 or 30 years.

Answer 5

There's a trick if you want to get an auto loan or a business account. I have done this twice; even had a bankruptcy. You dispute everything with the 3 credit agencies, then wait about a 3 weeks and go in for the loan or account while it's under dispute. The law states that a bank cannot turn you down for financial services while it's under dispute, so you get the loan or account. I have been told twice by my credit union in years past that they see the negative collection on my credit history, but since it's being disputed, we'll give you the auto loan. You win, butt heads lose.

Answer 6

Please see Studly's answer for all the technical answers. As for your question as to why a company would do this, is basically between their hands being tied to report it (which makes people who want to save their credit), SOL (which now takes their right to sue away), they're left with basically just harassing you and hoping you don't know how it all works and pay anyway. From a business standpoint, If I paid $200 to get this account from the original creditor, Plus the $500 over the last 7 years to pay someone to call you (wages, electricity, paper for bills, etc), I am now $700 into an $1,000.00 account you owe. Is it worth me as a company to potentially pay another $500 to chase you another 7 years (now totaling $1,200) for a $1000 account? No. Even if I get you to pay in half that time I'm in $950 and would only make $50 (not a lot of profit). Now the flip side. That time I had someone calling you I could have spent having them call on an active account or one worth $10,000 instead. Now that account is inacctive by the time I give up on you and now have the same delimma with the 2nd account. Now times that by how many accounts a day a rep can do, and then times that by how many reps I have. I can be out hundreds of thousands of dollars yearly easily chasing your puny $1000 you won't pay. It simply isn't worth my time. Basically it's if I borrowed a $100 from you. Sure I owe you and you want to be paid back, but if I moved away, would you spend hours of your time, your money, and your energy to track me down every day/month for the next 10-20 years? Or would you simply be pissed and chalk it up to a learning experience and move on? Most people move on or "give up" as you put it. They don't give up, it's simply no worth persuing past the 7 year point.

Answer 7

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I agree with crazyjester If you never paid on the account then the reporting period has passed and it should already have been removed from your credit reports. Send a debt validation request to the collector by certified mail return receipt. When you get the signed green card back send a dispute to the CRA's and claim it is obsolete and must be removed. If the collector verifies it and it remains, both the collector and the CRA's are in violation. You might click on my profile and click on the last link I have listed to a free credit discussion board. Do some reading in the Newbie Forum and in the Credit Forum. You will be able to find free sample letter templates for your validation request.

Answer 8

Per the Fair Credit Reporting Act, negative marks may only be reported 7 years from the date of delinquency. Nothing can legally reset the 7 year reporting period. Doing so is a violation of the law and you can sue them and win. Edit - Don't listen to the real estate guy. Paying it has ZERO effect on how long they can list it.

Answer 9

The absolutely free reverse vin check sites generally provide fake information. To get real information, money will have to be paid. The free searches provide fake information so they can get your email address to send spam.

Stay away from shady reverse vin check sites, most likely you won't get any information after you make the payment. Not to mention you won't get a report and you won't get an answer if you try to call for a refund. Stick with a reputable reverse vin check site like http://www.reversevincheck.net that has been around since 1995.

Answer 10

I had A collection that was paid of and closed back in 2012.On credit carma it was showing as closed and the balance 0 .collection company was not reporting it to equifax as closed.I called the collection company and asked them to remove the closed account showing.Instead they turned around and opened the account and now its really hurting my Credit score what can i do??????????????????????

Answer 11

I have had a collection agency just keep updating their Report every so often so it looks as if im disputing it from 2007. so ia year or so goes by and another and another.. now 2015 its still there with Remarks (debtor Disputes) and the & Yrs start all over again...BTW I DO NOT talk or hear from them