The Time Limit for Negative Data
The law allows credit bureaus to list negative information only for a definite amount of time. 7 years is the time list for the most negative data. Bankruptcy stays on credit report for a whole decade.
As a rule, you should repay old debts from the credit report when the time is out. Once scheduled by credit bureaus, negative credit reports should be removed from your credit report. If old accounts stay on your report anyway, take advantage of the dispute process to remove them.
Send a Dispute Letter to the Credit Bureau
This process is quite simple. Send a letter to the credit bureau to inform them, that you are disputing the outdated information. Send it via certified email and request return receipt to have the sending date and the receiver’s signature.
Your dispute will go without a hitch if the dates on your credit report indicate that the old account is removed. Sometimes the credit report can contain wrong delinquency date. In this case, you should send the evidence, that this date is inaccurate. It might happen if a collection agency gives debts another date when they report to the credit bureau. It is against the law and you can demand to have your account removed if the delinquency date was seven years ago or more.
In case of a dispute, the credit bureau is ought to do an investigation. It should check which business reported the account. If the business confirms, that the dispute is accurate, you will have the credit report updated. Thus, if the credit bureau does not correct the disputed error, you will have to make more steps to make your credit report clear.
In 2013 Julie Miller discovered errors in her credit file, which was Equifax’s mistake. Eventually, she won a case and a jury gave her $18.4 million in damages. That was the largest individual case on record at the time – here is more about this story.
Disputing with the Creditor
Do not Mix the Statute of Limitations
Check whether you confuse the credit reporting time limit and the statute of limitations on debt. This is a widespread mistake, as both of them define how long businesses can take some action on delinquent accounts. The credit reporting time limits are quite similar for every type of debt (not including delinquency) no matter what state you live in.
On the other hand, the statute of limitations on debt is opposite to the credit reporting time limit. It shows how long a creditor can commence legal proceedings against you for a debt. This statute varies by debt type and by state.