Credit Reporting - Learn The Facts

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A common concern for people is "how long will a negative mark stay on my credit report?" The answer is a maximum of seven years. A bankruptcy or judgment can remain for 10 years depending upon the statute of limitations in your state.

For many people this feels like a heavy prison sentence. During this time they are afraid to try and move out of a cramped apartment or upgrade from an old junker of a car.

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.

Before Congress enacted the Fair Credit Reporting Act (FCRA) in 1970 the credit bureaus were not limited whatsoever in how long they could report negative credit information. In fact, they could keep bad credit on your record 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.

Credit reporting is entirely voluntary. A creditor is not required to report an item for any length of time at all. In fact, creditors and collection agencies often remove credit report marks long before the seven year clock expires.

Creditors and collection agencies usually just need a little encouragement from a compelling dispute letter or a good credit repair attorney. Plus, the credit bureaus perform credit repair on your report at the seven year mark.

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.

However, the sad truth is that for now we are stuck living with the seven year limit. However, why should we wait to repair questionable credit until some arbitrary limitation has elapsed? Why shouldn't we delete questionable and misleading information immediately so that we can become creditworthy again?

About the Author:
To learn more about how to proceed with an experian dispute or equifax dispute or for more information on online credit repair visit us.



Article Originally Published On: http://www.articlesnatch.com


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