How long can negative credit stay on your report?

The Fair Credit Reporting Act or FCRA was signed into law in 1970 to protect consumers from unfair, misleading and inaccurate credit reports. It also set a time limit for reporting bad credit on a report. There is a limit to how long something that is negative but still accurate can stay on your report.

If there are inaccurate reports on your account, whether they are outright errors or simply misleading and not completely truthful information, you have the right to dispute this information to have it removed. Credit bureaus have 30 days from receipt of a dispute to verify the accuracy of your information or remove it from the report.

However, accurate and truthful information must remain on your report, but only for as long as the statute of limitations allows. The FCRA explicitly outlines the period of time during which negative credit information may continue to be reported.

Contrary to popular belief, the time period for reporting is not from the last activity on the account, so making payments or partial payments does not affect how long negative credit can remain on the report. The time limit begins immediately after the date of first delinquency with the exception of unpaid tax liens and unpaid federal student loans. These two items can remain on the report indefinitely, but everything else will disappear within a specified time period.

Most items will be delivered in 7 years regardless of when or even if they have been paid for. This includes late payments and if there are multiple late payments on a single account, each will be dealt with individually, leaving 7 years from the date of the late payment. Chapter 13 bankruptcies and tax liens or student loans that have been paid in full will also be automatically discharged after 7 years.

A cancellation account and a collection account will fall 7 years plus 180 days after the date of the first delinquency. Most collection accounts have been discharged from the original lender, so these accounts are generally treated the same as a discharge. Collection accounts often change hands between different agencies, however, that type of activity cannot legally change the statute of limitations. Both a bad debt account and a collection account must leave 7 years plus 180 days from the date of the first delinquency.

There are some variables to the 7 year rule. A Chapter 7 bankruptcy will stay on your report for 10 years. A hard query will only stay in a report for 2 years. And of course, if you don’t pay your federal student loans or tax liens, they can be reported forever or until you pay them, at which point the statute of limitations begins.

There are many things you can do to repair and improve your credit, even during the 7-10 years when most negative credit must be reported. And while you make improvements, be sure to maintain your good credit and eventually all bad credit will be erased from the past.