WalletPrep worksheet · Credit
How long do negative items stay on your credit report?
Name ____________________ Date __________
Key ideas
- Most negative items last seven years. Late payments, charge-offs and collections can be reported for 7 years. A bankruptcy can stay up to 10 years.
- The clock starts when you first fell behind. For collections, the 7 years start about 180 days after the missed payment that began the trouble. Paying later doesn't restart it.
- Accurate items can't be removed early. No one can legally remove true, current information. Wrong or outdated items can be disputed for free with the bureau and lender.
Vocabulary
- Credit report
- A record of your credit accounts, payments, balances and some public records, kept by each of the three credit bureaus.
- Collections
- When an unpaid debt is handed or sold to a debt collector after missed payments. It can hurt your credit score.
- Credit score
- A 3-digit number, usually from 300 to 850, that predicts how likely you are to repay debt on time. Lenders use it to set rates.
- Charge-off
- When a lender stops expecting payment on a debt and writes it off as a loss, usually after about 6 months of missed payments. You still owe it.
- Statute of limitations
- The deadline, set by each state, for a creditor or collector to sue you over a debt.
- Credit bureau
- A company that collects your credit history and sells reports to lenders. The three nationwide bureaus are Equifax, Experian and TransUnion.
Work it out
Sam pulls his reports and finds three collections: a $320 medical bill, a $1,200 medical bill he already paid, and a $650 phone bill he never paid.
- Medical, unpaid
- Medical, paid
- Phone bill
- Collections shown
- Medical under $500
- Paid medical
- Still reported
- Phone bill reported for
Check yourself
You first missed a payment that later went to collections. About how long can the collection be reported from that first missed payment?
- A. 2 years
- B. 7 and a half years
- C. 10 years
- D. Forever, until it's paid
Which of these should no longer appear on a credit report from the three nationwide bureaus?
- A. A $900 unpaid credit card collection
- B. A paid medical collection
- C. A 60-day late payment from last year
A company says it can remove an accurate late payment for a $99 upfront fee. What's true?
- A. This is a normal service
- B. It only works for late payments
- C. No one can legally remove accurate, current information
- D. It's fine if they give a contract
Your turn
Get your free reports at AnnualCreditReport.com, where you can check free weekly from each of the three bureaus at AnnualCreditReport.com. List every negative item with its amount and its date of first delinquency. Dispute anything wrong, any paid or under-$500 medical collection, and anything past its date.
Answer key
How long do negative items stay on your credit report?
Work it out
- Medical, unpaid$320
- Medical, paid$1,200
- Phone bill$650
- Collections shown= $2,170
- Medical under $500− $320
- Paid medical− $1,200
- Still reported= $650
- Phone bill reported for7 yr 6 mo
- Both medical collections break the bureaus' policies: one is under $500 and one is paid. Sam disputes them, so $2,170 − $320 − $1,200 = $650 should remain.
- The phone bill is accurate. Its clock starts 180 days, about 6 months, after his first missed payment, then runs 84 months.
- So it can be reported for about 6 + 84 = 90 months, or 7 and a half years, from the first missed payment. Paying it now won't change that date.
Check yourself
- B. 7 and a half years The 7 years begin 180 days, about 6 months, after the first missed payment. 6 + 84 = 90 months, or 7 and a half years.
- B. A paid medical collection The bureaus remove medical collections once they're paid. Accurate card collections and recent late payments can still be reported.
- C. No one can legally remove accurate, current information The FTC says accurate, current information can't be removed, and credit repair companies can't charge before they do the work.