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URL:  http://boards.fool.com/aj485-you-wrote-your-expectation-was-incorrect-30685519.aspx

Subject:  Re: Is This New? Examining my Experian Credit Re Date:  5/15/2013  2:47 PM
Author:  joelcorley Number:  307033 of 308881

aj485,

You wrote, Your expectation was incorrect. Accounts with deragatory information are required to be dropped no more than 7 years + 180 days after the first appearance of the most recent derogatory event. (The extra 180 days gives a missed payment time to be written off.) However, accounts with no derogatory information are allowed to stay on your credit report for up to 10 years after the account is closed.

I'm fairly certain (haven't read through the FCRA in a few years now) that the Fair Credit Reporting Act does not require positive trade lines be removed EVER. The 10 year purge of stale data is by convention with the Big 3.

Also since you're being precise, there is some derogatory information that can remain for 10 years. Most notably bankruptcy - as stated in the Act, Section § 605.(a)(1) Cases under title 11 [United States Code] or under the Bankruptcy Act that, from the date of entry of the order for relief or the date of adjudication, as the case may be, antedate the report by more than 10 years.

In addition a report with derogatory information older than 7 year + 180 days may be pull for the following reasons: Section § 605.(b) Exempted cases. The provisions of paragraphs (1) through (5) of subsection (a) of this section are not applicable in the case of any consumer credit report to be used in connection with
(1) a credit transaction involving, or which may reasonably be expected to involve, a principal amount of $150,000 or more;
(2) the underwriting of life insurance involving, or which may reasonably be expected to involve, a face amount of $150,000 or more; or
(3) the employment of any individual at an annual salary which equals, or which may reasonably be expected to equal $75,000, or more.


BTW, the changes that fixed these numbers in law should be of concern to most people, even if they don't apply to you today. In most markets, this section probably already applies to you when applying for a mortgage. And if it doesn't today, it will in the near future. Similar concerns apply to life insurance and employment, though perhaps not yet to a majority of the population.

- Joel
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