How Long Does a Debt Stay on a Credit Report?

A debt can remain on a credit report for several years, depending on the nature of the debt and the circumstances surrounding it. Understanding how long a debt stays on your credit report is crucial for managing your credit history and improving your credit score.

Duration of Debt on a Credit Report:

1. Late Payments: A late payment will typically stay on your credit report for 7 years from the date of the missed payment. The impact on your credit score will lessen over time, but the record will remain visible.
2. Charged-Off Debts: If a debt is charged off by the creditor (meaning they consider it unlikely to be paid), it will stay on your credit report for 7 years from the date of the original delinquency.
3. Collection Accounts: Debts that are sent to collections will remain on your credit report for 7 years from the date the account first became delinquent and was sent to collections.
4. Bankruptcies:
   • Chapter 7 Bankruptcy: Remains on your credit report for 10 years from the filing date.
   • Chapter 13 Bankruptcy: Remains for 7 years from the filing date.
5. Judgments: If a creditor sues you and gets a court judgment, the judgment can stay on your credit report for up to 7 years from the date the judgment is entered.
6. Tax Liens: Federal tax liens used to remain on a credit report indefinitely; however, they now generally stay for 7 years from the date they are paid off, or longer if unpaid.

Impact on Credit Score:

• Negative Impact: Debts that stay on your report, such as late payments or collections, can significantly lower your credit score. The impact is greatest in the first few years but gradually lessens over time as the debt ages.
• Positive Impact: As the debt gets older and your credit report shows more positive behaviors (like on-time payments and lower credit utilization), the negative effect of past debts may reduce.

Example:

If a consumer has an unpaid credit card balance that was charged off in 2020, the record of the charge-off will stay on their credit report until 2027. While the charge-off will negatively affect their credit score, the impact will decrease over time, especially if the consumer works on improving their payment history.