Credit 101

The 11 Most Commonly Asked Credit Questions

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At Credit.com, our readers ask us questions every day on every kind of credit problem you can imagine.  While everyone has their own unique concerns, there are also many universal issues out there.  So we rounded up 11 of the more common questions asked and we answer them right here for you.

1. How can the credit card companies raise my interest rate if I’ve paid my bills on time? What can I do about it?

It used to be that credit card issuers could raise your rate, even on existing balances, at any time and for any reason. Thanks to the Credit CARD Act, a federal law, they can no longer do this. They can, however, raise your rate on your outstanding balance if you are more than 60 days late with a payment and they can increase the interest rate on new purchases, but only if they give you 45 days advance notice so you can cancel your account.

As for what you can do, the best thing is to try to negotiate a lower rate. Call your card issuer and suggest you will take your business elsewhere if you can’t get a better deal. This works best if you have other credit cards with available credit lines, since the issuer will no doubt review your credit report to decide whether or not to work with you. It’s always worth a try, though. As author Marc Eisenson says, “Not asking is an automatic no!”

If you can’t negotiate a better rate, try transferring your balance to another card — either one you already have, or a new one.

2. A debt collector has contacted me about an old debt. Do I have to pay it?

Maybe; maybe not. Every state has a statute of limitations, which governs how long the creditor or collector has to sue you. If this debt is too old, and they try to sue you to collect, you can raise the statute of limitations as a defense. That means they don’t have much leverage in terms of forcing you to pay. And that gives you more leverage to negotiate a settlement — or just to tell them to leave you alone. For more information, and to fully understand your rights, check with your state attorney general’s office or a local consumer attorney.

If the debt is too old, you can simply write to the collection agency, indicate that you believe the debt is outside the statute of limitations, and instruct it to stop contacting you. Send your letter via certified mail and keep a copy for your records.

If you are worried about your credit report, keep in mind that collection items may only be reported for up to 7 1/2 years from the date you fell behind with the original lender, regardless of whether they are paid or not.

3. What is the ideal number of credit cards to carry?

It depends on what you mean by “ideal.” Most people will be just fine with two major credit cards. One should be a low-rate card for times when you must carry a balance, and the other should be a card with a grace period. No annual fee is ideal, unless you plan to use the card heavily to earn some type of reward. If that’s the case, weigh the cost of the annual fee against the freebies you will earn.

If you are asking about the ideal number of credit cards to obtain a strong credit score, two is a good number as well, though you can have many more and still maintain a strong credit rating. Generally, it’s a good idea to have at least four credit accounts of different types (for example, a mortgage, car loan, a major credit card and a retail card). Keep your credit cards active by using them periodically. It’s good to pay your bill in full each month to avoid finance charges.

Finally, if you have a lot of credit cards already, don’t close them in the hopes that it will boost your credit score. Your score may actually drop if you close old accounts.

4. My child has a lot of debt. What is the best way to help?

The best way to help your child is to give him or her some financial literacy materials to learn about how to manage debt.

But my guess is that you may be writing because he or she is asking you for a consolidation loan to help pay off the debt and, while you want to be helpful, you are not sure that’s the route to go.

First, trust your instincts. If you think your child has trouble handling money, then it is likely you will just be enabling him or her to go a bit longer without having to shape up. Even if your child is truly in deep straits, your loan is unlikely to solve the problem. He or she needs crisis intervention, not a loan.

If you simply can’t say no, then do one of two things:

  1. Give a gift rather than a loan. You’ll never have to worry about whether you will get paid back and there will be no hard feelings if you aren’t.
  2. Agree to lend the money only if your child will agree to sign an official loan agreement. It would also be a good idea to have them set up automatic transfer of the payments  to your checking or savings account from your child’s. There will be no wondering about whether a check has been mailed.

5. My spouse/parent died and I discovered a lot of debt. Do I have to pay it?

In most cases you are not responsible for another person’s debt when they die, unless you are a co-signer on the account. If, however, that person was your spouse and you live in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin), debts incurred during the marriage are considered community property and you are likely responsible for them.

When a person dies with outstanding debt, the creditor will first look to any co-signers and then to the estate for payment. The creditor may not bother to pursue the debt if it is a small amount, but there is no guarantee.

If you are feeling pressured to pay a debt you are not responsible for, or if you are not sure whether you have to pay your deceased relative’s debt, you may want to contact an estate planning or consumer law attorney.

6. I don’t have the money to file for bankruptcy. What can I do?

I am retired and Social Security is my only income (or I am on disability and have no income except Social Security Disability). That barely even covers my monthly rent, utilities, medicines, medical co-pays, food, etc. I am being hounded for credit card debts and the debt collectors are calling day and night.

It sounds like you have little income and no assets. If that’s the case, it may be that you are “judgment proof.” That means that even if someone tried to sue you, there wouldn’t be any way to force you to pay. Creditors generally cannot seize Social Security payments to pay debts. In addition, most retirement accounts (IRAs, pension plans, etc.) are also protected from creditor claims. If you are judgment proof, there may be no reason to file for bankruptcy.

You may want to talk with a bankruptcy attorney to assess your situation, especially if you have assets such as a home or money in bank accounts outside of retirement accounts.

If you are judgment proof, you will likely be able to stop the creditors or collectors from contacting you by simply writing a letter indicating that you have no income other than Social Security payments and no assets. Explain that you have no way to pay them and ask them to stop contacting you. At that point, they likely will stop. Keep copies of your letters, send the letters certified mail, and keep copies of any correspondence you receive. If you are sent any papers that indicate they may be trying to sue you, contact a consumer law attorney immediately.

7. Will checking my credit report hurt my credit score?

No. When you check your own credit report through a service that sells credit reports directly to consumers, you create what is called a “soft inquiry.” These inquiries are listed when you review your own credit report, but they are not shown to creditors and do not affect your score. You can pull a free copy of your credit report annually from each of the three credit reporting agencies or you can check your credit scores using the free Credit Report Card.

It’s a great idea to review your credit report on a regular basis, so go for it.

8. How many points does an inquiry take off your credit report?

There is no set number of points that will be deducted from your score for a single inquiry. The same inquiry from the same lender at the same minute can affect two people’s credit reports differently.

In general, inquiries are a small part of your credit score (less than 5%), and the stronger your score, the less likely one or two inquiries are to have an effect on your score.

Nevertheless, be very careful about applying for new credit, a cell phone, insurance, or anything that might result in a credit check if you are in the process of getting a mortgage. Sometimes a score drop of just a few points can drop your score below the range for the rate you are trying to get.

9. My ex-husband was supposed to pay this account, he didn’t, and it damaged my score. Now what do I do?

Joint accounts can create problems long after a marriage is over. Even though your ex-spouse is supposed to pay the bill according to the divorce decree, you are still on the hook for the debt to the lender if you are a co-signer. That’s because your divorce decree is an agreement between you and your ex. It doesn’t erase the original contract you had with the lender.

As far as your credit is concerned, the late payment will likely be considered accurate, since the account is still yours until it is paid off, closed, or refinanced into your ex-spouse’s name. Once in a while, a creditor will agree to remove the late payment from the innocent spouse’s credit report, but may require that it be paid off first.

Talk to your divorce attorney to find out what can be done in terms of forcing your ex to live up to the terms of the divorce decree. If he doesn’t have the assets to pay off the debt now, you may want to ask whether he can be required to make payments to your attorney, who can then make sure the payments are made. As long as the account remains unpaid, however, and he pays it late, your credit will be damaged.

10. I co-signed an auto loan for my daughter. When I tried to refinance my mortgage, I found out she has been paying it late, and it has hurt my credit score. What can I do to get that information removed?

Sorry, you’re likely out of luck. If there is one piece of advice we can give about co-signing, it is this: don’t do it. When you co-sign, you are agreeing to be fully responsible for the debt. And by law, if the issuer reports debts to a credit-reporting agency, it must report that information under the co-signer’s name as well as the primary account holder’s.

That said, the lender might be willing to remove those late payments if you will bring the account up to date and/or pay it off. If it does agree to “re-age” the account, get it in writing. Of course, by contacting the lender, you may find that you are inviting the creditor to contact you if your daughter gets behind again, whether or not your credit report is cleared. After all, you are the co-signer.

11. I’m deep in debt and have a terrible credit score. What should I do?

While it may not seem like a blessing right now, your lousy credit score may be a plus. It will keep you from digging the hole deeper with a “consolidation” loan. It’s time to focus all your effort on one goal — getting rid of that debt. I would first encourage you to get a free debt consultation to determine whether a credit-counseling program will work for you.

Even with bad credit, you may be able to get your interest rates lowered that way. And you’ll get advice to help you build money management skills. If it turns out this type of program won’t work for you, you may need to talk with a bankruptcy attorney.

Either way, once your debt is no longer an issue, you can begin to rebuild your credit. We have seen consumers significantly improve their credit scores in less than two years when they worked at it. Good luck!

Image: iStockphoto

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • Alex

    This was an excellent article!! Thank you. There is so much useful information for me to use as I continue to position myself to have the best credit score possible. I especially liked the part of this article where there was discussion on the Credit Card Act. It was a great tip for me because recently I did have an interest rate increase on one of my specialty credit cards that I am current on. This is great stuff. I also found some very good information relating to this sort of thing when I Googled the credit locker university. A big help as well. Thanks again!

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  • Tess

    Thanks for the information. I really enjoyed the article.

  • Robert Trinka

    Can someone please tell me why my credit score should be affected by applying for mortgage refinancing? I just don’t understand how anyone can interpret an application for credit as a negative event that lowers your credit score. I ended up not taking a new mortgage and am selling the house instead. Why is my personal decision on the management of my assets anyone’s concern? The credit agencies don’t ask for how much money you have in the bank or in the stock market or other assets you may have. This system really is flawed since it does not take into account your overall wealth and why you choose to use credit, particularly tax deductible mortgage and business loans.

    • Gerri Detweiler

      Does sound kind of crazy doesn’t it? But I think it helps to keep in mind that factors are only included in scores if they are found to be predictive. I think Barry Paperno explained it well in this piece: How Credit Scores Are Developed. As for the other information, keep in mind that scores can only measure what’s in the credit file. Do we want credit reporting agencies maintaining information about income, assets etc? I’m not sure…

      I am not necessarily trying to defend the status quo. Just trying to share some observations. Feel free to continue the discussion!

  • Dave

    best question never asked about credit scores; what legal right do credit bureaus have collect personal, private information on millions of people, score it, the sell that information, which is often incorrect, for their profit?

    • Gerri Detweiler

      Some consumer advocates have raised that question over the years, but have never gotten far with it.

  • B.O.A

    When an annual credit report is obtained, what information on my credit report do I request to be deleted. For example, is it a good idea to request the credit bureau to delete all previous phone numbers, addresses, old employers; old personal information generally?

    • Credit.com

      BOA – You should really only dispute information that’s inaccurate. I wouldn’t advise deleting previous addresses, employers, or old personal information. If the information is accurate, it’s a good idea to keep it — it helps with verifying your identity (when they ask you questions that only you would know in order to obtain your credit report, etc.).

  • cec

    How badly will a short sale on my house will affect my scores?. Never been late on any payments. I would like to purchase again next year, my income is high, and don’t have any debt. What are my chances of getting a good interest rate?

    • Mr FYI

      cec asks: “What are my chances of getting a good interest rate?”
      Ummm …. Non-existent. A “short sale” is a term created by the r.e. industry to sound better than “voluntary foreclosure.” Why would any bank lend you money at a great rate within a year after saying, “This investment is not working out for me, and I’m bailing.”

      Seriously.

  • ellen vickers

    My ex-husband took credit cards out on me and I did not know it till he died in 2004.I have tried everything to clear my credit score but can not do it.I had perfect credit till he messd it up I thought you had to have someones permission but he did not have mine so what do I do since he died to say what he did to me?

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  • cecile j fryling

    my late husband was a terrible money manager. he was always late on payments and also opened credit cards that i was not even aware until his untimely death in 2011. my credit score is terrible because of this. since i have been widowed, i have made every payment in a very timely manner. he had a heart transplant on 2001 and shortly after that we had to file bankruptcy (jointly). what can i possibly do to help my credit score improve? i am a very good money manager and since his death, i have a very good record–but no one seems to care about that. i really need help. thank you very much.

  • sherrie

    11MostCommonQuestionsReDebt

  • Bollamsky

    Why is your credit score affected negatively when you apply for a job and the background check is done

    • Gerri Detweiler

      It shouldn’t be. The employment inquiry (as long as it is classified that way) should be a soft inquiry. You see it, but no one else does and it doesn’t affect your scores.

  • Lou

    Why is it that paying cash for a home actually keeps your credit score lower than if you went through a mortgage company and financed. While I understand the principle of long term mortgages showing a persons ability to maintain good credit rating by timely payments (with interest to the loaner), it would also make sense that a person who can save and pay cash for a home is as if not more thrifty and credit conscious. My credit score runs around 780 but since I pay cash for Home and auto’s if needed, I doubt my score would ever hit the 800 mark. Just strange to me.

  • Deanna Templeton

    Actually, credit checks for employment screenings are soft inquiries so they don’t affect your credit score at all. Only hard inquiries, those that are a result of an application for credit or other type of service (phone, utility, cable, etc.), impact your credit score. Too many inquiries in a short period of time can definitely hurt your scores, but the good news is that inquiries — while reported in your credit reports for two years — only count towards your credit score for the first 12 months. You can read more about inquiries here: Should You Be Worried About Credit Report Inquiries?

  • Roz Ellington

    In reference to #8 in you most common questions asked…If your credit is ran without your permission and it lowers your credit score how can it be removed…are there steps that can be taken if not…how long does it remain on your credit report? Any advice would be greatly appreciated

  • ANCHOR

    I HAVE SOME NEGATIVE THINGS ON MY CREDIT THAT I KNOW ISNT MINES AND THE CREDITORS REFUSE TO TAKE IT OFF. I AM IN CREDIT REPAIR NOW HAVING IT DISPUTED. THE NAME THAT WAS USED ISNT MY LAST NAME AND ALSO THE ADDRESS LISTED IS IN ANOTHER STATE I NEVER LIVED IN AND THEY FAIL TO SEE IT. THEN ALSO, WHY DO THESE COMPANIES THAT GIVE YOU CREDIT ONLY REPORT YOU TO THE CREDIT BUREAU IF YOU DONT PAY? WHY NOT REPORT TO ALL CREDIT AGENCIES WHEN YOU ARE PAYING ON TIME EVERY MONTH TO INCREASE YOUR SCORE?

    • http://www.credit.com/ Credit.com Credit Experts

      Anchor – By law, creditors cannot arbitrarily report inaccurate information in your credit reports, and you have the right to dispute the information under the Fair Credit Reporting Act. You don’t need a credit repair company to file a dispute, and we actually advise against using them unless you fully understand what they do and how they work — you can read more about this topic in this article: Do I Need a Credit Repair Agency?

      If you have inaccurate negative information in your reports, it’s best to include as much documentation as possible to help the credit reporting agencies with the investigation process. Credit.com has several resources that can help you on that front, which can be found here:

      A Step-by-Step Guide to Disputing Credit Report Mistakes
      8 Rules of an Effective Credit Report Dispute Letter

      If you’re still not getting anywhere with the credit reporting agencies (and the items are inaccurate and do NOT belong to you), you may want to file a complaint directly with the Consumer Financial Protection Bureau (CFPB)— we’ve heard very positive results from consumers that have gone this route. To file a complaint with the CFBP, click here and then follow the prompts.

      And finally, if you truly want to work on improving your credit scores, you’re in the right place. Credit.com offers numerous educational resources and here are a two that we highly recommend to get you started:

      How to Rebuild Your Credit
      The Ultimate Guide to Credit Scores

  • Chris Schmitz

    OK, here is a good one for you that I can not find and answer to. Six or Seven years ago I was working as a self employed carpenter,, because of anothers stupidity, I got my hand in the table saw, ( still have all my fingers though) but ran up over $30,000 in medical bills had no insurance,, so was talked into filing for bankruptcy by my accountant. I met with an attorney, but before we got to filing apt, he quit and went to another firm, leaving me with a stupid greenhorn. We had first filing apt with courts and asked for a filing fee waiver, they denied it, and gave me thirty days to get the money together. In the mean time, I reconsidered the whole thing and asked greenhorn attorney If I could stop proceedings and not go through with it.. She said the case would dismiss in thirty days and all would be as before if I did not pay the filing fee. I trusted her, did not pay the fee, case dismissed, BUT,, here is the kicker,,

    Right after the filing initial court appearance, all my credit cards cancelled and went into debt collection..I payed them off after the fact

    My credit report shows I Filed for Bankruptcy

    I got NO debt liquidation

    I can’t get Bankruptcy off my report and it has majorly damaged my credit score

    I have a Bankruptcy on me report that NEVER happened

    I have ONE credit card 500 limit, and if I use it at all, say charge 250 for something, I have 50 % debt ratio, on a $250 balance which is almost nothing by average standards

    What do I do,, I am totally at a loss as to how to fix this

    Chris Schmitz,, Milwaukee WI

    • http://www.ssdanswers.com Jonathan Ginsberg

      Chris, the first thing you need to do is to find out if your case was actually filed. Was a case number issued? You can research this issue on the Pacer system (www.pacer.gov), or any bankruptcy attorney with a Pacer account can look it up.

      If a case number was issued, that means that your case was official filed and your credit report is accurate that you did file bankruptcy. If that case was administratively dismissed, your credit report will show a dismissed case as opposed to a discharged case.

      Note that credit reports reflect a history of your financial activities and the filing of this case – even if it was administratively dismissed by the clerk for not paying the filing fee – can remain on your report for up to 10 years.

      You can add a statement to your report indicating that you decided not to go through with your case and that you have otherwise paid your debts but the bankruptcy court record will show a case number associated with your name.

  • http://www.credit.com/ Credit.com Credit Experts

    Jennifer – In most cases, it’s best to leave credit card accounts open. At the very least, it will help your revolving utilization percentage — which is a significant factor in your credit scores. Closing the card could backfire and tank your scores. To explain, here’s how it works:

    If there was a large available balance on the card, closing it would close off the available balance and possibly have a negative impact on your revolving utilization percentage. Revolving utilization is the percentage of your balances to your credit limits, and accounts for roughly 30% of your credit score. The FICO score, specifically, looks at both individual utilization and aggregate — or total utilization across all of your credit cards. The higher your utilization, the lower your credit score. The lower your utilization, the higher your score.

    Typically, we’d advise keeping a credit card open and simply avoid using simply because the open credit limit would help your revolving utilization ratio. Ideally, you want to keep your utilization percentage at 10% or less for the maximum credit score points.

    In cases where it makes sense to close a credit card — when a card has an annual fee that’s not worth the cost, for example — you’ll want to make sure you do the math before closing the card. As long as closing the account doesn’t have a significant impact on your revolving utilization percentage (causing it to spike), the impact to your credit score would be minimal.

    For more on credit card utilization and how it impacts your credit scores, these resources may help:

    What is Revolving Utilization?
    Credit Card Q&A: What exactly is credit utilization ratio?

    In the end, it’s best to leave the account open and simply stop using it. The credit card issuers may decide to close the accounts due to inactivity at some point, but unless you know how closing the card will impact your scores, it’s safer to keep them open. And if the temptation to use the cards is a concern, one option is to cut the cards up so that they’re not readily available to you.

    Hope this helps!

  • Dani

    If my credit card bill is due the 24th and I remember on the 25th and get it paid, does it hurt my credit score less than not remembering to pay it until a week later?

    • http://www.credit.com/ Credit.com Credit Experts

      Dani – The only way it would affect your score is if the credit card issuer reported the late payment to the credit reporting agencies and it ended up in your credit reports. Generally speaking, most creditors wait to report a late payment until after the account goes 30 days past due — typically on the 31st day. While we never advise paying late, being just one day late wouldn’t hurt your score.

  • Vivian Allen

    I have 2 yrs to go 2015 before charge offs fall from my credit so should I file bankruptcy?????

    • http://www.credit.com/ Credit.com Credit Experts

      Vivian – filing for bankruptcy is a difficult decision and not one that should be taken lightly. As far as whether or not bankruptcy is right for you, much would depend on your individual financial situation and how much debt you’re dealing with. Even then, we’d still advise speaking with a bankruptcy attorney but to give you some general guidelines, the following resource should help answer some of your questions: When Should You Consider Bankruptcy?

  • Gerri Detweiler

    Vivian and lujones –

    Charge offs are reported by the creditors who charged off the bad debts. They can remain on your credit report for seven years from the date they were charged off.

    After the account is charged off, the debt may be sold to a collection agency. By law the collection agency is only allowed to report the collection account for 7 years + 180 days from the date you first fell behind with that creditor, so for all practical purposes that is the same amount of time that the charge off can be reported.

    If a new collection agency buys the debt and reports it, it will not start that time period over again, though a recent collection account can have more of an impact on your credit than an older one. This article about collection accounts on credit reports should help you understand this better: http://blog.credit.com/2013/02/7-facts-about-collections-and-credit-scores/

    Finally, whether you should consider bankruptcy is something that should be made after a review of your entire financial situation. I wouldn’t recommend it just because you are concerned about how these accounts affect your credit reports. But if you have a lot of debt and you simply cannot dig out, you may need to talk with a bankruptcy attorney.

  • http://www.credit.com/ Credit.com Credit Experts

    If the debt is scheduled to fall off in 2014, the credit reporting agencies have systems in place that will automatically remove these items. Keep in mind, though, the debt can be sold from one collector to another, resulting in multiple collections on your credit report –but this wouldn’t re-start the clock. Even if the debt is sold, the statute of limitations for reporting would be determined by the date the debt first went into severe delinquent status, usually at the 180 day late mark. Legally, they cannot restart the process or extend the debt for another 7 years so you’re safe there. However, having said this, you’re not in the clear yet and you should be aware that there is a difference between the statute of limitations on the time to report a debt in your credit reports and the statute of limitations for how long a lender/creditor/collector can sue you to collect the debt. If the lender decides to sue you, it could result in a judgment against you— which will stain your credit reports for another 7 years. If at all possible, we advise resolving the debt if you can. And if the debt has been sold to a collection agency, consider negotiating a settlement to settle the debt for less — this will insure that the debt doesn’t come back and cause more damage later on.

    To make sure you understand your rights, how long negative information remains on your credit reports, and how unpaid debts can spiral into bigger problems, the following resources should help:

    How Long Does Negative Information Stay On My Credit Report
    Debt Collectors Killing Your Credit? Here’s What To Do
    Seven Ways to Defend a Debt Collection Lawsuit

  • http://www.credit.com/ Credit.com Credit Experts

    Tammy -if the alarm company turns the account over to collections and a collection is reported in your credit report, it will have a significant negative impact on your credit scores. If there’s any way you can negotiate and pay the debt before it goes to collection, it’ll help you keep your credit scores in tact.

  • Gerri Detweiler

    Lane – Talk with a bankruptcy attorney right away. You may be able to file to stop the garnishment and keep your home and car. Let me know what they say OK? Hang in there.

  • http://www.credit.com/ Credit.com Credit Experts

    Mima —

    APR is an abbreviation for annual percentage rate. You’ll see the term when costs of credit are given (as in credit cards or mortgages, for example). You can read more about it here: What Is My APR, Really?. Hope that helps.

  • http://www.Credit.com/ Gerri Detweiler

    It is tricky in the case of medical bills because in some states spouses can be legally responsible for their spouse’s medical bills under state Doctrine’s of Necessaries. I’d suggest you work with your loan officer to see what he suggests. If you weren’t already in the loan process I’d suggest disputing them as “accounts not mine” but that can create problems when you are trying to get a home loan: How a Credit Report Dispute Could Stop You From Buying a Home

    If he threatens legal action, the collection agencies may remove them just to avoid problems. But that will be on a case by case basis. . Again, an experienced loan officer should be able to guide you through this.

  • http://www.Credit.com/ Gerri Detweiler

    By bad credit card debt do you mean a charge off? If so that can remain for 7 years from the date of charge off. Collection accounts may be reported for 7 years plus 180 days from the date you first fell behind with the original creditor. After that time period, those items will no longer be reported. (Often the agencies stop reporting about a month before.)

    Whether or not your scores will jump depends on how much these factors are affecting your scores. They are older, so they have less impact than something more recent but it’s difficult to predict the exact impact.

    Are you monitoring your free credit scores?

  • http://www.Credit.com/ Gerri Detweiler

    It is highly unusual no doubt but it can be reported for up to 7 years plus 180 days after you first fell behind with the original creditor. Have you tried disputing it? If it’s paid the collection agency may not bother to respond to the dispute and, if so, it would be removed.

  • http://www.Credit.com/ Gerri Detweiler

    I don’t believe so. If the collection agency is reporting it the only way the original creditor can influence it is to pull it back from collections. But I am guessing your best bet is going to be to try disputing it with the collection agency, explaining that you paid it long ago.

  • http://www.Credit.com/ Gerri Detweiler

    Not exactly. The credit score isn’t so much interested in your credit limit as it is in the comparison between your credit limit and the balance that is reported. You want to try to keep that ratio at less than 20 to 25%. 10% may be even better depending on your overall credit.

  • http://www.Credit.com/ Gerri Detweiler

    Sounds like a mess. Unfortunately, any joint debt he discharges in bankruptcy then falls to you. He won’t have to pay the debts he discharges, but your responsibility for it is not discharged. You might be able to negotiate a settlement on this amount – if you do, make sure you get it in writing before you pay.

  • http://www.Credit.com/ Gerri Detweiler

    Beth,

    Can you be more specific? Just because you pay a debt doesn’t mean it gets removed from your credit report. What is being reported?

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