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The general rule of thumb is that NEGATIVE credit drops off your credit profile seven years after the date of last payment.
So, if you end up owing some credit card company some money, seven years after your last payment to them, the record of this must drop off your credit profile.
Now, that is not to say that the debt disappears entirely after seven years. There are slightly more complicated rules about how long a debt may remain collectable. For the most part, unless court action is taken within a certain number of years to collect/enforce the debt, a debt becomes legally extinguished.
For example, in California, if you owe money to a credit card company, and stop paying, unless that company or whoever is assigned the debt (such as a collection bureau), files a lawsuit against you within four years of your last payment on the debt, and SERVES you with notice of that lawsuit so that you know to come to court, within a short time after filing that lawsuit, then the debt becomes uncollectible.
So in other words, if you owe a debt in California, and are not sued on it within four years, that debt becomes uncollectible.
But, sued or not, after seven years that debt must fall off your credit report.
Now, if you are sued, and served, and lose the lawsuit (which, let's face it - most lawsuits over consumer debt are pretty cut and dried - to quote Donnie Brasco, You know what you did, pal - and most all result in a victory for the credit), the end result of that loss will be court JUDGMENT against you ordering you to pay a certain creditor the amount owed, plus additional costs such as attorney's fees and interest (which continues from the date of judgment!).
In California, that judgment once entered remains collectible for TEN years, and may be renewed indefinitely every ten years. Now, as a matter of general policy, if a debtor is unable to collect on a judgment after ten years, who or what is left to collect on it after ten years has quite forgotten about the debt and will not bother to renew it. And when the judgment is renewed, you must be RE-SERVED with it, and if no one can find you and no one knows where you are, then there will be no way to renew the judgment.
The number of years to sue on debt, and how long a judgment once entered remains collectible, vary from state to state.
But still - the fact remains that once you are sued successfully, and judgment is entered, you may remain on the hook for the judgment indefinitely, because the judgment may be renewed, at least in some states, indefinitely at the end of each expiration period.
But, there are many ways to lie low and avoid the repercussions of judgments. Filing bankruptcy is not always the best way of dealing with judgments, which, incidentally, bankruptcies remain on a credit profile for LONGER than seven years, for up to 10 years from the filing date. I am an expert in advising people how go avoid the repercussions of debt and judgments - contact me for tech support on this.
Now, GOOD credit remains on your credit report:
1. So long as the credit account remains open,
2. For ten years from last payment, for closed good credit.
So you can see how, since good credit remains on your profile longer than bad credit, no matter how badly you ding your credit if you wait long enough it will repair itself.
So, if you end up owing some credit card company some money, seven years after your last payment to them, the record of this must drop off your credit profile.
Now, that is not to say that the debt disappears entirely after seven years. There are slightly more complicated rules about how long a debt may remain collectable. For the most part, unless court action is taken within a certain number of years to collect/enforce the debt, a debt becomes legally extinguished.
For example, in California, if you owe money to a credit card company, and stop paying, unless that company or whoever is assigned the debt (such as a collection bureau), files a lawsuit against you within four years of your last payment on the debt, and SERVES you with notice of that lawsuit so that you know to come to court, within a short time after filing that lawsuit, then the debt becomes uncollectible.
So in other words, if you owe a debt in California, and are not sued on it within four years, that debt becomes uncollectible.
But, sued or not, after seven years that debt must fall off your credit report.
Now, if you are sued, and served, and lose the lawsuit (which, let's face it - most lawsuits over consumer debt are pretty cut and dried - to quote Donnie Brasco, You know what you did, pal - and most all result in a victory for the credit), the end result of that loss will be court JUDGMENT against you ordering you to pay a certain creditor the amount owed, plus additional costs such as attorney's fees and interest (which continues from the date of judgment!).
In California, that judgment once entered remains collectible for TEN years, and may be renewed indefinitely every ten years. Now, as a matter of general policy, if a debtor is unable to collect on a judgment after ten years, who or what is left to collect on it after ten years has quite forgotten about the debt and will not bother to renew it. And when the judgment is renewed, you must be RE-SERVED with it, and if no one can find you and no one knows where you are, then there will be no way to renew the judgment.
The number of years to sue on debt, and how long a judgment once entered remains collectible, vary from state to state.
But still - the fact remains that once you are sued successfully, and judgment is entered, you may remain on the hook for the judgment indefinitely, because the judgment may be renewed, at least in some states, indefinitely at the end of each expiration period.
But, there are many ways to lie low and avoid the repercussions of judgments. Filing bankruptcy is not always the best way of dealing with judgments, which, incidentally, bankruptcies remain on a credit profile for LONGER than seven years, for up to 10 years from the filing date. I am an expert in advising people how go avoid the repercussions of debt and judgments - contact me for tech support on this.
Now, GOOD credit remains on your credit report:
1. So long as the credit account remains open,
2. For ten years from last payment, for closed good credit.
So you can see how, since good credit remains on your profile longer than bad credit, no matter how badly you ding your credit if you wait long enough it will repair itself.