Sometimes, when people are drowning in debt that they cannot repay, the only hope they have is to wait out the debt until it comes off their credit report. Although this can take seven to 10 years depending on the type of debt, it is sometimes the only option for individuals who have an immense amount of debt they cannot pay but who want to eventually rebuild their credit.
Old debt left on a credit report even after it should have been taken off can hamper these goals. So, if you have old debts still on your credit report, how do you get them taken off so you too can once again start rebuilding your credit? Just follow the tips below.
How Long Should Debt Stay on Your Credit Report?
Most debts should come off your credit report within six or seven years. Some debts have a charge-off period of 180 days. This means that even if the debt is supposed to be removed within a certain period of time, such as seven years, the charge-off period of 180 days may be added to that, resulting in a total time of seven years and 180 days before the debt is removed from your credit report.
However, there are some exceptions. For example, a bankruptcy can stay on your credit report for up to 10 years. After filing bankruptcy, you should still always obtain a copy of your credit report. While you will see the bankruptcy listed, you should not see any of the debts that were discharged as part of your case. Still, even with a bankruptcy on your credit report, instilling healthy credit habits will help ensure the black mark on your credit report does not completely decimate your credit score so you can still start rebuilding your credit.
Once you obtain your credit report and see that old debts are still showing even though they should be removed, it is important that you know what steps to take.
Send a Letter Disputing the Debt
In most cases, you do not need to do anything to have old debts removed from your credit report. The credit bureaus will schedule when they should remove the debt and the process will happen automatically. Keep in mind that this only applies to old debts and other negative information. Credit bureaus have their own guidelines pertaining to when to remove other information, which is not regulated by law. However, if negative information is not removed in the time required, you can start the dispute process by sending a dispute letter to the credit bureau that is still reporting your debt.
A dispute letter is just that. It is a letter you send to the credit reporting bureaus that states that the debt is old and that you would like it removed from your credit report. When sending your letter, include any evidence that supports your claim, such as documentation pertaining to the debt that shows the last date of delinquency.
Under the Fair Credit Reporting Act, the credit bureau should respond to your letter within 30 days of receiving your letter. This is one reason it is so important to send your letter via certified mail, as the receipt will show you what date the agency received your letter.
After receiving your letter, the credit reporting agency should conduct an investigation. This process involves the agency contacting the lender or debt collector that initially reported the delinquency. Sometimes, lenders and debt collectors place a new date on the debt, which is illegal. If, after the credit bureau’s investigation the debt is still not taken off your report, you will need to take additional steps.
Starting a Dispute with the Creditor
When a dispute with the credit reporting bureau does not result in an old debt being removed, your next step is to dispute the debt with the creditor that reported the negative information to the bureau. Your dispute letter to the creditor will look very similar to the dispute letter you sent the credit reporting bureau. You should indicate that there is an incorrect delinquency date for the debt and, if you have proof of the last date of delinquency, you should include this in your letter as well. Documentation may include an old past due notice, billing statement, or previous credit report.
Creditors and debt collectors, just like the credit reporting bureaus, must conduct an investigation into your dispute. They also must respond to your dispute within 30 days of receiving your letter, which is why it is also important that you again send the letter by certified mail. After the investigation, the creditor or debt collector must provide proof that the debt is not old and, therefore, will remain on your credit report. If they cannot provide this proof, they must remove the debt from your credit report.
Credit Reporting Time Limit vs. Statute of Limitations
Many people confuse the credit reporting time limit with the statute of limitations on their debt. It is crucial that you do not make this same mistake so that you are only disputing debts that should be removed from your credit report.
Again, the credit reporting time limit is six to seven years, after which time the debt must be removed from your credit report. The statute of limitations on debt, on the other hand, is five years in Florida. This means that once your debt is five years old–and if you have not made any payments on it–the creditor cannot file a lawsuit against you to recover that debt. However, a debt can still appear on your credit report even once the statute of limitations has passed.
Are You Facing a Debt Lawsuit? Our Florida Debt Defense Lawyers can Help
Learning that a creditor or debt collector has filed a debt lawsuit against you is scary, and you may not think there is anything you can do about it. At Loan Lawyers, our Fort Lauderdale debt defense attorneys know that is not true, and that there are several defenses to these lawsuits. When someone has taken legal action against you in regards to debt, call us at (954) 807-1361 or contact us online to schedule a free consultation.
Loan Lawyers has helped over 5,000 South Florida homeowners and consumers with their debt problems, we have saved over 2,000 homes from foreclosure, eliminated more than $100,000,000 in mortgage principal and consumer debt, and have recovered over $10,000,000 on behalf of our clients due to bank, loan servicer, and debt collector violations. Contact us for a free consultation and find out more about our money back guarantee on credit card debt buyer lawsuits, and how we may be able to help you.