How You Can Get Closed Accounts Off Your Credit Report

Reviewing credit report

How You Can Get Closed Accounts Off Your Credit Report

Having closed accounts still showing on your credit report can be disheartening. The way creditors manage your accounts, such as closed accounts and payment history, can determine how you credit score in the future. This blog discusses how you can maintain a better credit report to ensure positive creditworthiness moving forward.

Understand How Long Negatives Stay There

Many people are unaware of how long negatives stay on their credit report. Closed accounts fall under two timelines: seven years and ten years.

Negative items, including late payments and collections, can stay on your report for seven years from the date of the first missed payment. Therefore, if you were 30 days late on a payment in January 2018, it would fall off in January 2025 (seven years later).

Conversely, closed accounts that have a history of good standing fall off after ten years and give creditors a record of proper payments. This is also an incentive to check your reports often to ensure things fall off when they should.

Dispute Errors or Inaccuracies

Errors happen all the time; sometimes, mistakes are made on the creditor's end that account holders have to fight to remove. Per the Fair Credit Reporting Act (FCRA), if you have an error on your report or believe that something is inaccurate, here's how you can dispute it:

1. Get your reports: Equifax, Experian and TransUnion all provide free credit reports. Get one from each.

   
   

2. Identify incorrect details: Make sure you're looking at all three reports and note differences, such as a debt balance too high or an account belonging to someone else.

   
   

3. File a dispute: Contact each bureau to dispute it with them.

   
   

4. Follow up: The credit bureau has 30 days to respond after investigating. If a creditor cannot validate the information is true, it must update/erase your report accordingly.

   
   

It's worth it for every inaccuracy or error that might lower your score—not all errors are willfully applied, so take advantage of all options under the FCRA.

Goodwill or Pay-for-Delete (Use Caution)

Letters of goodwill or pay-for-delete arrangements rarely work but can work for some creditors on occasion.

Goodwill Letter

If a negative mark still resides on your report after all debts are paid to a creditor but you have a history with that creditor before that negative mark of timely payments, consider sending them a goodwill letter to appeal for a removal of the adverse mark. This works if someone had one late payment because they were sick or lost their job—if that's the only blemish on an otherwise good history—ask them nicely to remove it.

Pay-for-Delete

You can also send out pay-for-delete arrangements where you offer to pay for part of the debt in exchange for marking the account paid off and removing any negative information. However, get this in writing first because not all creditors will abide by these arrangements, and only do this if you are comfortable doing so. Remember, however, that per FCRA, you must accurately report these debts.

Allow Time for Automatic Removal

If there is no disputing the negative item that it's valid but hurts your credit score, sometimes the best option is to wait for it to come off naturally when it should. The time typically is seven years—so if an item remains open past that time, monitor it enough to have it drop off at the right moment.ory.

Final Thoughts on Credit Report Management

Removing closed accounts from your credit report may seem challenging at first, but armed with the right knowledge, you can take control of your credit history. By understanding how long negative items last, disputing inaccuracies, and leveraging goodwill or pay-for-delete options wisely, you can work towards a cleaner credit profile.

Keep in mind that sometimes the best course of action is simply to wait for negative items to be removed. Regularly monitoring your credit report will help you stay proactive in your efforts.

By applying these effective strategies, you can work on improving your credit score and create a promising financial future.

Close-up view of a credit report showing important details