Credit bureaus gather information about your past borrowing habits, delinquent debts and even your rental history. Federal laws limit the information these agencies can gather and how long your details can be kept on file. However, when it comes to time lines for information being added to your file, you are often at the mercy of your creditors.
Major lenders normally notify the credit bureaus every time you make a payment on a credit card, installment loan or mortgage. The bureaus typically add this information to your file upon receipt, so in most cases your credit report updates within a few days of the end of your billing cycles. However, lenders do not have to submit reports to the three credit bureaus. Some small firms only submit a report to either Experian, Equifax or TransUnion rather than all three. Therefore, you may get a credit report from one of these agencies that does not include your car loan or mortgage. If you buy a car financed through a private dealer or a rent-to-own home then you are even less likely to see the debt on your report, since few private citizens establish credit-reporting accounts.
When you are trying to qualify for a home loan or credit card, the new lender may require you to pay off some of your existing debts as a condition of receiving the new loan. If you do not want to wait a month or more for the payoff to show up on your report you can ask your lender to arrange a rapid re-score. This involves the lender contacting the credit bureaus and asking these agencies to expedite the process of updating your report. Typically, lenders have to pay a fee for rapid re-scoring, and your lender may require you to pay this cost.
Debts disappear from your credit report once a lender stops providing the credit bureaus with updates. Therefore, delinquent debts sometimes vanish if the lender gives up hope of collecting on the debt. However, collection agencies often buy years' old debts for pennies on the dollar, and these agencies have as much right as the original creditor to report the past due balance to the credit bureaus. Legally, credit bureaus can list debts from the past seven years on your credit report, so you may see a debt from a few years ago making a reappearance in your credit file.
If a creditor fails to notify the credit bureaus when you pay off a debt or if someone simply misreports your borrowing information, you have the right to file a complaint with the bureau in question. Legally, bureaus must investigate such reports and determine whether you have a legitimate case to make. You normally receive a response within 30 days of filing the complaint, and assuming you can prove your case, the bureau must immediately update your file to reflect the actual status of the debt.
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