Collection

How long does a collection stay on a persons credit report?

My fiance and I got in a little disagreement a little while ago about how long collections stay on a credit report. He says that after 7 years they will be removed from a persons credit report - whether they are paid or not. I disagree with that. Why would collection agencies just "give up" trying to collect money from a person and take it off a persons credit report. It doesn't make sense to me. If collection agencies just stopped trying to collect from a person after 7 years wouldn't a lot of people not pay their bills because it will just go away after 7 years? Can someone clarify this for me? Thanks!

Public Comments

1. Just because it is not on your credit report does not mean the debit has gone away. It means for most practical debits, they have been charged off as bad debits and taken off the lenders taxes; but that does not mean they won't still collect. Some collections stay a lot longer. IRS liens, state tax and owner's association dues can stay or be renewed in some states for up to 20 or 30 years.
2. Your fiance is correct. In fact, in some instances, the debt is no longer collectible BEFORE the 7 years is up. If the amount outstanding is significant, and I'm sure different lenders/collection agencies have different thresholds, they will pursue the debtor though civil court. For smaller amounts, they'll write the dbt off as a cost of doing business, and the debtor lives with crappy credit for 7 years.
3. most collection agencies say its after u pay your bills off it takes 7 years from the date u paid off in full.. and most people pay it so it can make their credit look better or there trying to get something like a car, loan, etc
4. I'd be glad to clarify! Collections stay on your credit report 7 years after the date of last activity. Don't let this confuse you...normally 7 years after date of last activity means the date that it was sold to the collection agency. Usually your account must be 180 days past due in order for the company to do that. Basically, I'm saying that the collection stays on your report 7 years and 6 months. After that, it will fall off your report. Now, to get to your question, the collectors don't just give up and stop trying to collect the debt. Legally, they are still entitled to their money since they were not paid as agreed. They can attempt to collect that debt forever, if need be. You're right. Many people would just wait out the 7 years and start all over if that was the case. Cheaper than bankruptcy, no?! But that debt will follow someone until it is settled or paid.
5. Your fiance is technically correct, collections no longer show on your credit report after 7-years from the last reported date. Like the other poster stated, you will need to add another 180 days for your lender to sell the debt to a collection company. So total time required is 7.5 years from the time you quit paying. This doe's not mean that you don't still owe the debt, it simply means that it no longer shows on your report. The statutes of limitations is different in each State for debt collections. Check with you State to see how long the collection companies can come after you. After the S.O.L. expires, the debt is no longer collectable, unless you choose to pay it.
6. Let me clarify this again.....I post this same stuff over and over, and yet these people still repeat the same incorrect information. It's no wonder people are confused! The credit reporting time is 7 years, beginning on the date of the >>>delinquency<<<....NOT the reporting date, last transaction date, charge off date...... That means (for example) if you owed a bill on January 1, 2000, and missed that payment, THAT date begins the reporting period. So on January 1, 2007 the report must be deleted. The 180 days period keep referring to is the "built in delay" that creditors must wait before they can begin putting this on your report. It can NOT show on your report until July 1, 2000...but it DOES NOT add 180 days to your report. Please see the actual law below. Now class....lets move on.... The Statute of Limitations is the legal timeframe a creditor has to take legal action to collect a debt. Every state has a differant SOL time from 3-10 years (averages around 6). The SOL date is the last transaction date. THAT means the day you last made a payment, or the date you charged an item to your account. After this period runs out, the creditor is barred from taking any legal action against you. They can still attempt to collect the debt, but since they can't sue you there is little they can do. The dog can bark but can't bite! So hubby is right....after 7 years the debt disappears from your record. After the SOL expires they can't even even sue you. But they sure can harrass you. You can put a stop to that also by just taking the time to read the Fair Debt Collection Act and learn your rights.