How Long Do Negative Items Remain on your Credit Report?

Negative information on your credit report can be reported for up to seven years, but sometimes longer if it is serious. The length of time noted in these bullet points means from the start time of your late payment or delinquency, not the last time you made a payment on the amount.

Some collection agencies, though, will update their reports to keep your account active with the credit bureaus so they can lengthen the time a negative item stays on your report. You do have a right to challenge this and you should if it happens to you!

So what are some of the negative items that are put on your credit report?

• Bankruptcy information can stay on your credit report for 10 years;
• Tax Liens can stay on your credit report for 7 years after they are paid;
• US Government insured or guaranteed student loans can be reported for 7 years after certain guarantor actions;
• An application for $50,000 or more worth of credit of life insurance can actually stay on your report forever;
• Information about a lawsuit or judgment against you can stay on your report for 7 years.

Poor credit scores are normally the sign of poor fiscal management by an individual. Lenders and banks use your credit score to determine whether or not you are dependable enough to borrow money to. They know a poor credit score means that individual hasn’t always been the most trustworthy with their credit accounts. Perhaps someone with a poor credit score has too much credit already opened or has held them self in credit debt for a long period of time. Whatever the reason is, a person with poor credit might not be determined as creditworthy enough to take out a bank loan. And if you are a person with bad credit, you might already know this. You are more prone to getting a heart attack due to low credit rating, a report suggests.

***Two Loan Options for Bad Credit Rating Holders***

You might have an emergency that requires you to get a loan as soon as possible. If this is what you need, there are plenty of loan lenders set up that feed directly to those with bad and poor credit. These credit lenders will generally provide you with two different options when examining the choices of quick loans you can take out. These loan types include a secured bad credit loan, and an unsecured loan:

1. Secured Loans: A secured loan is considered a better choice, financially, for those with bad credit. When applying for a secured loan, you must give up something of equal value to the loan. You are basically giving the loan provider a piece of collateral in case you default or go bankrupt while on the loan. These types of loans feature interest rates similar to those given to people with excellent credit from larger loan lending agencies.

Why is this excellent choice for those with poor credit? Almost any type of loan you take out is considered a form of credit. If you give $5000 as a form of collateral for a $5000 loan, or 2 – 2500 dollar loans, you’ve just opened a positive source of credit. This shows on your credit report, and as long as you keep making your payments on time, it will show, as well. This in turn will increase your credit score. That will enable you to get larger loans from more mainstream lenders with lower interest rates.

2. Unsecured Loans: The other option open to those with bad credit from bad credit loan lenders is an unsecured loan. An unsecured loan is a better option for those with no type of money or assets available to give the lender as collateral in case of defaulting on the loan. However, the fees and interest rates are stiff. With some interest rates reaching more that 30%, if you can’t afford to pay much more than the minimum monthly amounts due, paying off the principle on the loan could take many, many years.

Simply put, unless you are in some dire financial situation, taking out an unsecured bad credit loan can be an extremely poor financial decision.

Be Careful of the Fine Print; Don’t Let Lenders Take Advantage of Your Bad Credit!!!

Getting a bad credit loan isn’t always as difficult as it seems. There are plenty of lenders willing to lend you money, however, make sure you read the fine print when they ask for your signature. Some of the interest rates can be outstanding, making taking out a bad credit loan not the smartest of choices you could make financially.

To get yourself a proper loan, you will want to see what you can do to increase your poor credit score before anything else. Look at your current accounts of credit and ask yourself what you can do to start paying off those credit cards and loans that are making your credit score so low. Cut back on nights outside and spend more days relaxing at home, making dinner yourself instead of ordering out, and slow down your shopping habits. Put this extra cash towards your credit accounts and start paying off your debts. This will look very good to your creditors and show you are becoming more responsible with your credit. This can cause an increase in your credit score, and in turn make you more accountable to take out loans with better interest rates. However, if you don’t have the money it will take to start paying those loans back, avoid opening any more credit accounts if at all possible!