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The Statute Of Limitations Pertaining To Unfavorable Credit Scoring
In 1970 the Fair Credit Reporting Act or the FCRA was put into law in order to protect consumers from unfair and deceptive credit reporting. Among the provisions of the law were some distinct restrictions on how long negative credit can be reported.
Nearly all credit reports contain some types of errors. If however you find some errors or mistakes showing on your report you can send in a dispute and attempt to get them deleted. The credit bureaus must validate the accuracy of their information within a 30-day period following receipt of your dispute or they must remove the disputed information.
If the information is completely truthful and accurate it should remain on your report for a specific period of time that is established by the FCRA. When the statute of limitations runs out the negative item must be deleted.
Many folks may incorrectly believe that all reporting is from the last date of activity on the account. But this is not correct. The time limit begins the moment the date of the initial delinquency and ends after the time limit has passed. There are two exceptions to this rule though and that is unpaid tax liens and unpaid Federal student loans. These items can remain on The Credit Report forever unless they are paid off and then they will drop off within the time period limit.
Many items will drop off in 7 years regardless of when or even if they have been paid. This includes late payments and if there are numerous late payments on a single account each one will be treated individually, dropping off 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 drop off automatically after 7 years.
Charge off’s and collections are treated a bit differently. Both of these items will drop off in the 7 years but with the addition of 180 days since it usually takes that much time after the first delinquency for the item to really be charged off. Most collection accounts have actually been charged off from the original lender so of course, they are treated the same and even though collection accounts are often passed around to different collection agencies, the time limit for reporting never changes, they must drop off at 7 years and 180 days from the date of first delinquency.
There are several variables from the 7-year rule. A Chapter 7 bankruptcy will remain on your credit report for 10 years. A hard inquiry will only stay on A Credit report for 2 years. And of course, if you fail to pay your tax liens or your Federal student loans they can be reported forever or until you pay them off at which time the statute of limitations period begins. Sure, Credit Score Repair is feasible and so is legal credit repair on-line.
Even though time will eventually repair all your credit problems there are some things you can do in the mean time to repair your report and improve your credit score. And always, once you make improvements and repairs you must be steadfast in keeping your report clean and as time passes all your Bad Credit will be in the past.
