If You Dispute a Credit Report, Does That Start the Date of Last Activity Over Again?

Credit reports have limits on the time they report most negative items. Positive accounts may appear indefinitely, the Federal Trade Commission advises that late accounts must be wiped out of credit bureau files seven years from the delinquency date. This is different from the last activity date, although disputing credit reports does not affect either of them.

Definition

A credit report is a file created maintained by the three dominant credit bureaus. TransUnion, Experian and Equifax all have their own files, which report on credit accounts and activities like loan applications and payments. The date of last activity refers to the last time there was a change reported on an account, according to Lew Sichelman of MarketWatch. This may be anything from an increased credit limit or owed balance to an account closure.

Considerations

Consumers have the right to use a dispute process for credit file mistakes, the FTC explains. Many people use this process to repair their credit because it often removes old negative-status accounts. Any error is grounds for a dispute, and the Divorcenet legal information site explains that such items are erased if the credit bureau is too busy to thoroughly investigate them or if the creditor ignores verification attempts.

Process

TransUnion, Experian and Equifax have online dispute pages for consumer use. People simply enter the required information about the erroneous item, and the bureaus investigate it within 30 days of receiving it. This process is separate from account activity dates because it is conducted by the bureaus and does not involve any direct interaction with the original creditor or actions on the account itself. The bureaus erase anything they cannot validate as correct.

Effects

Disputing an item in a credit file does not have any affect on the seven-year reporting period for negative accounts, which does not start from the last activity date. Rod Griffin of the Experian public education department explains that it begins on the date the account first became late. Both activity and delinquency dates are not affected by disputes. Account change dates and late payment dates remain constant.

Warning

The last activity clock does not restart for disputes, but the challenge might be ruled as "frivolous" or "irrelevant" if it has no basis, Divorcenet warns. The Fair Credit Reporting Act exempts credit bureaus from pursuing complaints in those categories. Avoid this by limiting disputes to items with genuine mistakes, and provide a detailed explanation of what is wrong.