When Do Closed Accounts Come Off Your Credit Report?

A credit report details an individual’s financial behavior, including credit accounts, payment history, and other relevant activities. This document influences approvals for loans, credit cards, and housing applications. Understanding how long different types of closed accounts remain on a credit report is important for consumers to manage their financial standing and comprehend their overall credit profile.

Reporting Timelines for Accounts in Good Standing

Accounts that were closed in good standing, meaning they had a history of timely payments and no significant delinquencies, can remain on a credit report for an extended period. For instance, a paid-off loan or a credit card account closed with a zero balance and a positive payment history may stay on your credit report for up to 10 years from the date of closure. The reporting period often starts from the date the account was closed or the last activity was reported.

Even after an account is closed, its positive payment history can continue to benefit your credit profile. Lenders and credit scoring models consider this historical data when assessing creditworthiness.

Reporting Timelines for Negative Accounts

Negative closed accounts have specific reporting periods, remaining on a credit report for seven years, with some exceptions. This duration begins from the date of the original delinquency, which is the first missed payment that led to the negative status, rather than the date the account was closed or paid off.

Late payments, whether 30, 60, or 90 days past due, stay on a credit report for seven years from the date of the original delinquency. The impact of these late payments on a credit score lessens over time, but the record itself remains.

Collection accounts, which represent debts turned over to a collection agency, remain on credit reports for seven years from the date of the original delinquency. This applies whether the collection account is paid or unpaid. Similarly, charge-offs, where a creditor writes off a debt as a loss, stay on credit reports for up to seven years from the first missed payment that led to the charge-off.

Bankruptcies have different reporting timelines depending on the type. A Chapter 7 bankruptcy, which involves liquidation of assets, can stay on a credit report for up to 10 years from the filing date. A Chapter 13 bankruptcy, which involves a repayment plan, remains on a credit report for seven years from the filing date.

Foreclosures and repossessions remain on credit reports for seven years from the date of the first missed payment that led to the event. Civil judgments and tax liens previously appeared on credit reports, but changes implemented by the major credit bureaus in 2017 and 2018 resulted in their removal from credit reports. While these public records no longer appear on credit reports, they may still be accessible through public databases.

Understanding Credit Report Information

Consumers can access their credit reports annually for free from each of the three major credit bureaus—Experian, Equifax, and TransUnion—through AnnualCreditReport.com. Reviewing these reports helps individuals understand their financial standing and identify reported accounts.

For closed accounts, a credit report displays information including the account status (e.g., closed, paid), the original creditor’s name, the account number, and the opening and closing dates. It also includes a detailed payment history, showing whether payments were made on time or if any delinquencies occurred. Credit scoring models incorporate all reported information, including both open and closed accounts, to assess creditworthiness.

Addressing Reporting Discrepancies

If inaccuracies or outdated information are identified on a credit report, consumers have the right to dispute these discrepancies. The process involves contacting the credit reporting company and the entity that provided the incorrect information, the data furnisher.

When initiating a dispute, clearly explain in writing what information is incorrect and why, providing supporting documents if available. The credit bureau is required to investigate the disputed item within 30 days. If the information is found to be inaccurate, the credit bureau must correct or remove it from the report. Consumers should retain copies of all correspondence and documents related to their dispute.