Credit Reports

Very often, settled accounts can remain on a credit report for several years. The good news is that there are ways to have these accounts removed you just have to know what to do.

Why They Are Still There

So youre probably wondering why in the world after youve held up your end of the bargain and paid off a debt, it still shows up on your report. Unfortunately, there is no rule that says that settled accounts have to be removed from your credit report after youve settled your debt. In fact, the only time that, by law, an account must be removed is 7 years after the original delinquency. And with a bankruptcy, the information can remain on your report for up to 10 years. The account will be marked as paid or settled but it will sit there, alerting future lenders of your prior delinquencies.

How to Have Them Deleted

Youll probably be happy to know that you can indeed have some information removed from your credit report. Its just a matter of knowing how to manage the companies handling your settled accounts. The best time to request that the information be removed is actually before you agree to make your first payment. Youll want to make the removal agreement a part of your contract to pay back your balance. In other words, unless they agree in writing to take it off of your report once its paid off, you wont agree to pay. Collection agencies usually agree to these terms because they want their money.

Making Sure it Gets Done

Once your balance has been paid in full, you can expect that the company will not call the credit bureaus to have the information removed on their own; youll need to remind them. By giving them a quick call and requesting the information to be completely removed (not showing paid), you should hopefully have it settled. However, if you want to cross-check, you can ask the three credit bureaus to run investigations for removal.

While settled accounts can show up on your credit report, its good to know that by taking the right steps, you can have them removed.

Your credit report is often viewed by a number of agencies and companies; some of these views are known as hard pulls and soft pulls. Also known as inquiries, when a company or agency pulls information from your report, they are trying to obtain information that can help them make a decision regarding an interest that they have in you.

But hard pulls and soft pulls dont stop at just providing information to interested parties; they also have a very direct effect on your credit report and score. So to give you a better idea of what these actions entail, lets look more closely at their meanings.

Soft Pulls

Soft pulls are inquiries made to your credit report that have no adverse effect on your score. Many times, these types of inquiries occur without your knowing. For example, a company may conduct this type of inquiry if they want to see if you qualify for a pre-approved credit card or loan. Also, some employers may conduct the soft pull as a part of their background check. However, no one else looking at your report can see these inquiries and it doesnt lower your score.

Hard Pulls

Hard pulls are considered the bad guys of the inquiries. These types of inquiries occur when a lender looks at your credit to determine whether you should receive a loan or credit card. The difference between these and the soft pulls, however, is that the former stays on your credit report for up to 6 months and actually lowers your credit score by about 5 points. This may not seem like a huge penalty, but if you seriously apply for too many loans or credit cards, your score can lower significantly.

Its important to know the difference between hard pulls and soft pulls, as well as the impact both have on your credit report and score. By knowing their impacts, you can make informed choices that will positively affect your use of credit.

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