Do what you can to avoid having these negative entries added to your credit report. For example, be proactive about contacting your creditors if you anticipate having trouble keeping up with your payments. Many creditors are willing to work with you if you contact them before you fall behind. They might be willing to waive a payment, let you pay late without a late fee, or change your due date. Charged-off accounts remain on your credit report for seven years from the date the account is first delinquent. In other words, it’s seven years from your first missed payment. If you pay off the debt after it’s charged off, it will be listed on your credit report as a paid charge-off. It will still stay on your report for seven years, but it may have less of an impact on your score if it’s paid. Many debt collectors report the collection account on your credit report, adding another negative entry. The collection will stay on your credit report for seven years, even after you pay it off. Fortunately, when you pay a collection, the account is updated to show that you paid in full, so it does a little less damage to your score. When this information was allowed on credit reports, it was often incorrect. For example, someone who had a tax lien and the same name as you could have their record attached to your report. It was often difficult to get the information corrected. Today, bankruptcies are the only public record information that appears on credit reports.
