Zombie Debts and Your Credit Report
Time-barred debts can be listed on your credit report, although there is a time limit for doing so. Debts that have not gone to judgment (judgments are separate) can stay on your credit file for 7 years after the debt is either sent to an in-house collection department, an outside debt collector or charged-off. A charge-off is an accounting term and means that the creditor has given up trying to collect the debt. It does not mean that you don’t owe the debt. A debt typically charges off somewhere between 90 and 180 days (roughly 3-6) months after the date of your last payment. So the maximum that a debt can remain on your credit is 7 ½ years from the date of your last payment.
Not all debt collectors follow the law and many of them will falsely attempt to “refresh” the date of the debt by using a different date to make it appear that the debt was more recent. If this happens to you, you have rights. First, you must dispute this in writing with each of the 3 credit bureaus – Equifax, Experian and Trans Union. Each have websites (www.equifax,com. www.experian.com and www.transunion.com). Ask the credit bureaus to investigate and tell them why the information about the debt is in error. Credit bureaus don’t do much of an investigation – basically, they ask the debt collector or debt buyer if the information is correct. If the debt collector or debt buyer affirms it, then that is the extent of the investigation. Your next step is to send a certified letter to the debt collector or junk debt buyer. If the debt collector or junk debt buyer refuses to remove the information, then go to an attorney as you can bring a lawsuit under the Fair Credit Reporting Act, 15 U.S.C. §§ 1681-1681x.
To get a free yearly copy of your credit report, go to www.annualcreditreport.com. That site will link you directly to each of the credit bureaus. Unless you are the victim of identity fraud or theft, stagger your free reports and get one from a different credit bureau every 4 months.
Copyright (c) 2012 by Rachel Lea Hunter
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