Jim Kemish is the president and founder of Power Mortgage, a Florida mortgage company based in Delray Beach, Florida. Power Mortgage Corp was established in 1989 and serves the states of Florida, Georgia, Massachusetts, and Virginia. Jim is also the President of Sky Blue Credit, a national credit repair business.
Statute of Limitation Violations
The Fair Credit Reporting Act (FCRA), and the Fair and Accurate Credit Transactions Act (FACTA) amendment to the FCRA of 2003, is the federal legislation that governs the credit reporting industry. Statutes of limitation for reporting time limits are provided by this legislation. Knowing how these time limits work is essential to any effective credit repair effort.
In Plain English
Let’s try to put some of this jargon into plain English. The term “statute of limitation” in the case of your credit reports, simply refers to the maximum amount of time that a derogatory item can continue to be reported. When the statute of limitation passes for any negative item on your credit report, that item should vanish. There are an amazing number of violations of these time limits that may appear on your report. Some violations are intentional as in the case of many of the collection accounts that we see, and others are due to a simple failure of the highly complex credit reporting system. A careful credit repair effort can eliminate these violations.
An Interesting Point
In a moment we will review statutes of limitation for the most common types of derogatory information. But you might find it interesting to know that the Federal Trade Commission permits the credit bureaus to delete information at any time at their discretion. There is no requirement that the bureaus wait until the passing of a statute of limitation date to stop reporting.
Collections and Charge Offs
Collections and charge offs must cease reporting seven years plus 180 days from the initial delinquency that led to the collection status or to the charge off. The initial delinquency is the date of the first 30 day late status that led to the collection or charge off. This period of time cannot be reset by any subsequent payment or for any other reason. The clock starts with the original creditor. Collectors such as assignees, attorneys, or collection agencies must abide by the same original statue of limitation expiration date. Neither the original creditor nor collectors can extend these reporting limits. Any attempt to do so is illegal. Unfortunately this law is often ignored. Effective credit repair efforts require a very exacting examination of these dates.
Bankruptcy
Chapter 7 bankruptcies can report for 10 years from the discharge date. Chapter 13 bankruptcies can report for 7 years from the filing date. But be aware that if the Chapter 13 is not completed the reporting limit is extended to 10 years. I mentioned above that the credit bureaus are allowed to delete information from your report prior to the expiration of statute of limitation. Any credit repair effort should take this flexibility into consideration. Bankruptcy is a case where we highly recommend requesting removal. If you are five or more years past discharge your request may be honored.
Tax Liens
Paid tax liens can report for 7 years from the date of payment. Unpaid tax liens can report for as long as they are in effect. Please be aware that most unpaid tax liens are released by the IRS after 10 years. The IRS will usually provide a lien release upon request after the 10 year limit has past. When you provide the release to the credit bureaus they will cease reporting. There are cases that allow the IRS to re-file. Please speak to your CPA or tax attorney for clarification before contacting the IRS!
Judgments
Generally, unpaid judgments will cease reporting 7 years after the filing date. However, unpaid judgments are a case where state statute of limitation will overrule federal statute. Your state may allow unpaid judgments to report for longer than 7 years. State statutes of limitation are easily found on the internet. Paid judgments may be reported for 7 years from the filing date. No state statutes may overrule federal limits for paid judgments.
Gone but Not Gone
Derogatory information that falls off of your credit report due to an expiration of the statutory time limit does not get deleted. This obsolescent information should not continue to appear on your credit report, but it is not gone. If you apply for a loan for over $150,000, life insurance with a death benefit over $150,000, or a job that pays over $75,000, your potential lender, insurer, or employer has the right to view your prior history. This fact adds some additional support to the case for credit report vigilance. If you are attempting credit repair and have erroneous info on your report it is best to dispute it now. Waiting for the statue of limitation to pass may not produce the clean result that you want. Disputed items that get deleted are literally removed from your credit report.
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
- Related Videos
- Related Articles
- Ask / Related Q&A
- Cheap Personal Finance: Money at Low Rate for Personal Needs
- 4 Things You Can Do to Control Personal Finance, and not Have it Control You
- Keeping An Eye On Your Personal Finances
- 8 Great Personal Finance Sites
- Personal Finance: What People Buy On Payday
- Personal Finances - Getting Off the Paycheck to Paycheck Roller Coaster
- Personal Finance Articles: How Changing Your Mind About Your Personal Finance Will Change the State of Your Wallet
- Basic Tips on Personal Finance




Bad credit vs good credit
By: reliacredit | 03/07/2009How important is a good credit score? Pretty important, especially for your financial life. Your financial life depends on the credit score you have. It gives a measure of your trustworthiness and the regularity with your payments. You future creditors refer to your credit report before then allow you loans or mortgages.
How important is a credit score
By: reliacredit | 03/07/2009How important is a good credit score? Pretty important, especially for your financial life. Your financial life depends on the credit score you have. It gives a measure of your trustworthiness and the regularity with your payments. You future creditors refer to your credit report before then allow you loans or mortgages.
What affects your credit score?
By: reliacredit | 03/07/2009There are a number of factors that affect your credit report. You need to be aware of these factors else you might end up ruining your credit. Even a single delay in a payment can cause your credit score to dip.
Factors Affecting Your credit
By: reliacredit | 03/07/2009There are a number of factors that affect your credit report. You need to be aware of these factors else you might end up ruining your credit. Even a single delay in a payment can cause your credit score to dip.
Eighteen percent barrier broken with credit card rates
By: Reno Charlton | 03/07/2009As many people will already know the interest rates charged on credit cards have been soaring over the past couple of years, even though the Bank of England base rate has plummeted over the last seven months, taking it to an all time low level of just 0.5 percent. However, as the base interest rate has plunged average credit card interest rates have rockets, and it is now reported that credit card rates have now smashed through the eighteen percent barrier.
Many credit cards made available to those on low wages
By: Reno Charlton | 03/07/2009Whilst the news has been full of stories about how difficult it can be to get hold of a credit card these days, a recent report has revealed that a large number of credit cards are being made available to those that are on quite low incomes, increasing the risk of credit card debt amongst those with low income.
Credit Rating Score: How It Increase Your Loan Eligibility?
By: Alden Decosta | 03/07/2009This is the root of getting a good credit rating. When the rating goes wrong, it will take a time to set it right, and a lot of time and effort it needed to achieve this task. Each timely payment of your credit rating will improve and your report will go on the way to recovery.
Free Credit Report UK: Make the Most of the Opportunity
By: Jass Parker | 03/07/2009The financial institutions use your free credit report UK whenever you apply to them for credit cads, loans, or mortgages and by other companies when you apply for any product or service and that requires you to sign up for some form of credit such as mobile phone contract.
The Credit Repair Path to Success
By: Jim Kemish | 02/07/2009 | CreditDo you want to turn your financial life around? Credit repair offers all of the tools to get the job done. But you will have to do your part as well.
Credit Repair, Expectations, and Reality
By: Jim Kemish | 17/06/2009 | CreditCredit repair can work wonders. But it is not a magic cure. You will need to work to get the results you want.
Debt Validation Tips for Credit Repair Success
By: Jim Kemish | 03/06/2009 | CreditDebt validation is a valuable credit repair tool when used properly. Take the right steps and the results should be excellent.
Credit Repair and Credit Score Mastery
By: Jim Kemish | 02/06/2009 | CreditAre you looking for optimal credit repair success? Then you need to understand the logic behind the credit scoring formula.
Credit Repair Life Lessons
By: Jim Kemish | 22/05/2009 | CreditHere is a collection of true stories illustrating the basic rules of credit repair. We hope you find our tales to be both entertaining and informative. Enjoy!
Credit Repair and Your Credit Cards
By: Jim Kemish | 19/05/2009 | CreditYour credit cards can have more of an impact on your scores than you know. Here are some credit repair tips that you can put to work today.
The Wonders of Credit Repair
By: Jim Kemish | 07/05/2009 | CreditCredit repair is the process of removing reporting errors and improving your credit scores. Done right, the results are breathtaking.
Credit Repair and Your Identity
By: Jim Kemish | 30/04/2009 | CreditIf you have concerns that someone may have used your identity to apply for credit there are a variety of credit repair solutions you should consider.