Major Credit Bureaus - Learn the Cold Hard Facts about Reporting

Navigation

You are here: Free Article Directory » Finance » Credit » Major Credit Bureaus - Learn the Cold Hard Facts about Reporting

Major Credit Bureaus - Learn the Cold Hard Facts about Reporting

by: MattDouglas | Total views: 2 | Word Count: 444 | View PDF | Print View
Share This Article

Your Ad Here

Many people want to know how long a negative notation will stay on their credit report. The answer to this is seven long years. If you have a bankruptcy or judgment the notation can stay on your report for up to ten years.

The majority of people fell like they have just been handed a long prison sentence. During this time they are afraid to move into a home or upgrade to a nicer car because they do not want to be charged outrageous interest rates.

Seven years - why?

Is a one time mistake with your credit really worthy of a seven year punishment? Why should you have to pay the outrageous cost of having a bad credit report, especially when it was just a brief time in your life? Do all the months of paying on time not count for anything?

Why is seven years the magical number? Has it been discovered that people will not make mistakes or run into financial hardship after seven years?

No, there is no scientific reasoning behind the seven year mark. It is a completely random time limit.

The Fair Credit Reporting Act was passed by congress in 1970. This piece of legislation established the reporting time limit. Before the Fair Credit Reporting Act a negative notation stayed on your credit report forever.

Congress established the seven year maximum for the credit bureaus. However this is only the maximum, you can often have a mark removed before the seven years have slowly ticked away.

Congress made it illegal for credit bureaus to report a bad credit mark for longer than seven years. Frequently people have successfully had a negative mark removed long before the seven year time limit.

Reporting to the credit bureaus is completely voluntary. Creditors and collection agencies are not required to report any notations or accounts to the bureaus. As well they often remove notations and accounts long before seven years.

Typically the creditors and collection agencies just need some influence to remove a mark. This influence should come from a well crafted dispute letter or a good credit repair attorney. The credit bureaus will also give you some credit repair once the seven year time limit runs out.

In a perfect credit world negative marks would remain on a credit report forever. So long as they accurately reflected the credit worthiness of the applicant. Instead our credit reports are an excuse for creditors to assign outrageous interest rates and down payments.

Just like there is no good reason for the seven year time limit for a negative notation to be on your credit report. There is no good reason why we should not make efforts today to remove negative information from our credit report.
Share This Article