A blemish generally will stay on a person's credit report...


August 01, 1993|By Knight-Ridder News Service

A blemish generally will stay on a person's credit report for up to seven years. But when does that clock begin ticking?

The law isn't clear on this issue, says the Federal Trade Commission, which enforces the Fair Credit Reporting Act.

However, the credit reporting industry says it is legal, in some cases, to report the same blemish twice.

A blemish generally may remain on your record for up to seven years, and the clock starts to tick on the date the item was first reported. The limit is 10 years from the date a bankruptcy filing is reported.

After the seven-year period has expired, the blemish must be removed, even if the status of the account has changed.

But if the account is transferred to a third party -- a collection agency, for example -- the unpaid debt may be reported a second time by the account's new owner, according to credit-reporting officials.

Because the law is unclear, you probably can't do much if you run into a problem about a blemished report -- other than hounding the credit reporting agencies.

And remember, a lot of people who defaulted on student loans in the 1970s and 1980s are just starting to see those blemishes. That's because many of those bad loans were not immediately reported, but now the government is cracking down on student-loan deadbeats.

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