How Long Is It for Debts to Be Removed From a Credit Report?

Debt information that is positive can remain on credit reports indefinitely. A borrower who never misses a payment on an active credit card may see the account remain on the credit report for more than a decade. Most people want good credit history to remain on their credit report because it boosts credit scores. However, there are federal laws regulating how long negative credit information can remain on credit reports.

Limitations

Negative credit information includes missed payments, balances over the credit limit, debts that are settled for less than the full balance, monetary judgments, foreclosures and bankruptcies. The Fair Credit Reporting Act requires removal of most negative credit information after seven years. For example, an auto loan account with a poor payment history would expire after seven years. Bankruptcy information remains for a minimum of 10 years. Typically, the impact of negative information on a credit score decreases as time passes, even before it is erased from the report.

Credit Repair

So-called credit repair agencies may insist they can remove negative credit information and debts sooner than the established standards. However, the Federal Trade Commission suggests that many of the agencies engage in unethical practices while attempting to repair credit. The FTC recommends that people forget about negative information on their credit reports and focus on the future instead. The agency notes that it is possible to overcome all credit shortcomings -- including foreclosure and bankruptcy -- in as little as two to three years.

Challenges

The three major credit bureaus -- TransUnion, Equifax and Experian -- must remove credit information that is incorrect. The credit bureaus acknowledge that mistakes happen, and inaccurate or outdated information on debts sometimes is placed on credit reports. The Fair Credit Reporting Act requires credit bureaus to conduct an investigation after a consumer submits a dispute challenging the accuracy of information on his credit report. If the credit bureau cannot verify that the information is valid, it must delete the information. Some people exploit the process by challenging debt information they know is accurate. Their hope is that the credit bureau will not complete the investigation within the 30-day time frame required by the Fair Credit Reporting Act, which would force the credit bureau to delete the item. Credit bureaus are allowed to dismiss disputes deemed frivolous.

Pay-for-Delete

Creditors and debt collectors sometimes will remove certain debts through a process called "pay-for-delete." This allows removal of the account before it is scheduled to expire under terms of the Fair Credit Reporting Act. The borrower usually initiates the agreement by offering to pay the full amount owed on a delinquent debt. In exchange, the creditor agrees to delete the account from credit reports. This process is legal, but many creditors and debt collectors will not participate, because they consider the practice unethical.