What debts can’t be removed from your credit report?

Credit reports represent a snapshot of your financial health. That snapshot comprises debt you’ve paid or are currently paying down.

You might think that debts are removed from your credit reports once you pay them off and close the account. However, the information can remain on the reports for years after you send that final payment to the creditor. There are also some cases in which debt can stay on your reports indefinitely.

Because credit reports are an essential part of financial life, it’s important to keep track of them and the debt information that populates them. It’s helpful to know which debts will disappear over time, which will likely stay around longer and which ones can be removed.

What debts go on your credit report?

To understand what debts are reported, it’s a good idea to understand the nature of debt and how it relates to credit reports.

Debt is money that you owe to a lender or creditor. You borrow that money, agreeing to pay it back by a specific deadline, usually with interest. Debt owned by a person (vs. a business) is personal or consumer debt.

Meanwhile, credit reports are developed and issued by three credit reporting bureaus: Equifax, Experian and TransUnion. Each report provides data to interested parties that you have authorized, such as potential lenders, landlords or employers.

Credit reports offer a mix of information like:

• Installment loans (personal loans, auto loans, mortgages).
• Revolving credit (credit card accounts and lines of credit).
• Soft and hard inquiries from lenders and creditors.
• Personal information such as your name, date of birth and Social Security number.

Many people assume that all your debts will end up in one of the three credit reports at one time or another, but that isn’t the case. Rent and utilities aren’t typically reported to the three bureaus (unless you don’t pay them and they are sent to a collections agency). Nor are pre-paid debit cards. Certain types of medical debt — like accounts with a balance of less than $500 — also don’t appear on your report. You also won’t see debt that you owe to family or friends, and payday lenders and title loan companies don’t report to credit bureaus either.

How long does debt stay on your credit report?

Most debt stays on your credit report for around seven years from when you make the last payment, but this can vary depending on the type of debt involved.

The chart below provides a general idea of the debt involved and the length of time it can stay on a credit report:

Most of your debts have an expiration date, after which they are removed from your credit reports. But some of that debt can hang around indefinitely.

“Child support obligations will stay on your credit report indefinitely unless they’re paid off or settled with the IRS or state agency,” explains Randall Yates, co-founder at VA Loan Network. “These types of debts reflect legal obligations, and credit bureaus are required to keep them listed to ensure financial transparency.”

When should debts be removed from your report?

You might think the ultimate goal is to delete all debt from your credit reports as quickly as possible, but doing so is difficult. Plus, debt can help your overall credit score.

Chris Roberts, partner with Butsch Roberts & Associates Inc., says debt accounts in good standing are good for your credit report and overall credit score. “These show lenders that a consumer is responsible and an appropriate credit risk,” he says. “Even if the account is closed, if it’s in good standing, it can provide lenders with the assurance that you are a responsible borrower.”

The Fair Isaac Corporation (FICO) and VantageScore offer different models for calculating your credit score, and they like it when you have a long, positive credit usage history. The longer your accounts have been active (and in good standing), the more it can boost your credit score.

The story is different if you’re facing a negative debt account. A negative account is one in which you’ve missed or are behind in payments. Negative accounts on your credit report can decrease your credit score, potentially impacting your ability to buy a home, rent an apartment, get a job or obtain a loan.

Unfortunately, the only way to remove a negative account is if the information is incorrect or time-barred. “If there’s a reporting error, the consumer may have recourse under the Fair Credit Reporting Act,” Roberts says.

How do you remove old or inaccurate accounts from your reports?

Removing debt from your credit reports usually means waiting until it can no longer be reported. At that time, they should “drop off” automatically and disappear.

However, this might not always happen. The credit reporting bureaus might have faulty information from your creditors or lenders, leading to errors on your credit report.

If you see debt still appearing on your credit report long after it should have dropped off or if the information about the debt is incorrect, take steps to remove it from your report.

1. Be sure of your facts

Get reports from all three credit bureaus. By law, you can obtain a free credit report annually from each credit reporting agency, but you can get them weekly from AnnualCreditReport.com.

Be sure that what’s listed on the reports matches your records. If the credit reporting agencies don’t have the correct debt discharge dates, it could explain why an account still shows as “active.”

Checking your credit reports can help you spot errors or mistakes in reporting, like incorrect payments or even fraudulent accounts. If these show up on the reports, gather your documentation and prepare to inform the credit reporting agencies.

2. Submit the dispute to each credit reporting agency

The Fair Credit Reporting Act requires the three credit reporting agencies to correct or delete unverified, incorrect or incomplete information.

“If the credit reporting agency declines to remove the inaccuracy, then the consumer may potentially have a claim under the FCRA against each credit reporting agency that continues to report the inaccuracy and also a potential case under the FCRA against the creditor reporting the account to the credit reporting agency,” Roberts says.

For Equifax, Experian and TransUnion to correct or remove the information, they must first know it exists. This means you must file an online dispute, call the credit bureaus or write a dispute letter to point out the error and why it should be corrected, along with documents detailing the mistake. You can file disputes online or send letters by U.S. post. If you decide on the latter method, send the mail with a delivery receipt requested.

The FCRA requires the credit bureaus to correct any misinformation on your report within 30 days.

3. Send a letter to the creditors

If you’re dealing with old debt on your credit reports, it might be easier and more effective to work directly with the creditor to remove it rather than going through the credit reporting agencies. Gather all the necessary documentation to prove your case and send it to the creditor in question with a succinctly worded letter. The creditor has 30 days to look at your issue and respond.

4. Talk to an attorney

Sometimes, the direct approach might not work. If you aren’t having any luck with the credit reporting agencies or the creditors themselves, getting an attorney on your side might be helpful.

A lawyer specializing in debt resolution and familiar with the FCRA can help you by sending a letter on official legal letterhead to credit reporting agencies or creditors. That expert can also advise you if and when you need to file a lawsuit.

Which debts are harder to remove from your credit report?

It’s not easy to remove debts from your credit report. Your only two ways to do this are with patience (the debt will eventually be time-barred) or to prove that information about the debt is in error. If the debt is correct, it stays in place until it can no longer be reported.

As mentioned earlier, some debts stick with your credit report, no matter what. These include:

• Alimony
• Charge-offs
• Child support

Additionally, “Debts like bankruptcies and foreclosures are almost impossible to remove from your report,” Yates says. “They stay around for seven to 10 years because they indicate severe financial distress, which lenders need to know.”

The bottom line

Knowing about your debts is important, as is understanding how long certain types of debt will hang around on your credit reports and how they might impact your credit score. Some forms of debt can drop off in a matter of years, while others might remain indefinitely.

Keeping track of this debt helps you pinpoint potential errors that could otherwise get in the way of your goals, and familiarizing yourself with credit reports and the role debt plays in them can help you build and maintain a secure financial life.