A good credit score is important. It can affect your ability to get a loan, buy a house, get a credit card, rent an apartment, and sometimes even get a job. But sometimes things happen in life and you miss a bill and end up with a negative item on your credit file. Today, we’ll talk about some of the different negative items and how long they can impact your score.
Late payments. We’ve all done it – found that credit card bill sitting there days after it was due, realizing that we forgot to pay it. Although each credit account is different – some are considered late almost right away – generally, a payment is late at 30 days. Your creditor reports every monthly payment you make as on time or late, so the late payment ends up affecting your credit report and will remain a factor on your score for seven years.
Collections. When you miss too many payments and don’t make acceptable arrangements with your creditors, they may turn the bill over to a collection agency, and that becomes a negative item on your credit report. Both paid and unpaid collections show up on your file and affect your score, and they stay on your report for about seven years, depending on how old the debt was when it was reported.
Inquiries. Even inquiries, or requests by potential creditors to see your file, can impact your score because a new potential creditor will consider it a possible new account that will affect your ability to repay a debt. A hard inquiry is when you’ve applied for credit, and those are the ones that can affect your credit score by as much as 15 points.
Bankruptcies. Millions of people have had to file bankruptcy, so you’re not alone if you’ve had to file. But when you do, it affects your credit score more than any other negative item. Chapter 13 bankruptcies stay on your record for seven years, and Chapter 7 bankruptcies stay for 10 years. A bankruptcy can affect your score by as much as 260 points.
These are just a few examples - there are several other negative items that can affect your score. Sometimes these items are wrong, and sometimes negative items stay on for too long. That’s where knowing what’s your file and disputing wrong items can help get your credit score back on track.
Our credit professionals at Credit Refit can help you review your file and take the steps needed to remove information that is wrong to improve your credit score. To find out how, give us a call at: (312) 883-4412 or complete our online form. Our customer service team can help you determine the best options for your needs. You can also earn referral credits just by sharing Credit Refit with friends & family. Learn how to earn $25 per referral that can be easily applied monthly to your account!