Derogatory items can hurt your credit and make it harder to qualify for loans, credit cards and favorable interest rates. Late payments, collections, charge-offs and bankruptcies are common examples.
Whether you can remove a derogatory item depends largely on its accuracy. Inaccurate or incomplete information can be disputed. Accurate negative information generally cannot simply be removed, although its impact may lessen over time.
What Is a Derogatory Item?
A derogatory item is negative information in your credit history that may indicate missed payments, unpaid debts or other credit problems. Common examples include:
- Late payments: Payments reported 30 days or more past due.
- Collections: Past-due debts transferred or assigned to a collection agency.
- Charge-offs: Debts a creditor has written off after serious delinquency.
- Foreclosures: Mortgage defaults that resulted in foreclosure.
- Bankruptcies: Bankruptcy information appearing in your credit history.
Negative information is only one part of your credit profile. Payment history, balances, account age and other factors can also matter. Learn more about the factors that affect your credit score.
Can Derogatory Items Be Removed?
Derogatory items may be removed when information is inaccurate, incomplete, duplicated, outdated or does not belong to you. Federal law gives consumers the right to dispute inaccurate information on their credit reports.
Accurate negative information is different. It generally cannot be removed simply because it hurts your credit. Many negative items can remain on a credit report for up to seven years, while certain bankruptcy information can remain for up to 10 years.
How to Remove Inaccurate Derogatory Items
1. Review All Three Credit Reports
Start by reviewing your reports from Equifax, Experian and TransUnion. Consumers can access free weekly credit reports through AnnualCreditReport.com.
Check all three reports because the information reported by each credit bureau may differ.
2. Look for Specific Errors
Review each negative account carefully. Check the account owner, balance, payment history and important dates. Look for duplicate accounts, incorrect balances, incorrectly reported late payments or accounts that do not belong to you.
Don’t dispute information simply because it is negative. A legitimate dispute should identify information you believe is inaccurate or incomplete.
3. Gather Supporting Documentation
Collect documents that support your dispute. These might include account statements, payment confirmations, creditor correspondence or identity theft documentation.
Keep copies of what you submit and clearly identify the information you believe should be corrected.
4. Dispute the Inaccurate Information
You can dispute inaccurate information with the credit bureau reporting it. You may also contact the creditor or company that furnished the information.
Explain what is incorrect, why you believe it is incorrect and include supporting documentation. Credit reporting companies generally must investigate disputes within 30 days, although certain circumstances can extend the timeframe.
The Consumer Financial Protection Bureau provides additional guidance on disputing errors on your credit report.
5. Review the Results
After the investigation, review the response and check your reports again. If information is found to be inaccurate or incomplete, it should be corrected or removed as appropriate.
If you’re dealing with several credit issues, our guide on how to fix your credit score covers additional steps for evaluating your credit profile.
What If the Derogatory Item Is Accurate?
If a negative item is accurate, disputing it does not make it disappear. Instead, focus on preventing additional negative marks and strengthening your credit history over time.
- Make future payments on time.
- Bring past-due accounts current when possible.
- Reduce revolving balances when practical.
- Avoid unnecessary credit applications.
- Monitor your credit reports for new errors.
Paying or settling an outstanding account does not necessarily erase its previous history. The account may instead be updated to reflect its current status.
How Long Do Derogatory Items Stay on Your Credit Report?
Many types of negative information can generally remain on your credit report for about seven years. Certain bankruptcy information can remain for up to 10 years. The exact timeframe depends on the type of information involved.
You don’t have to wait for an old negative item to disappear before working on your credit. Positive payment history, responsible credit use and established accounts can contribute to a stronger overall profile.
Be Careful With Credit Repair Promises
Be cautious of companies promising to remove every derogatory item or guarantee a specific credit score increase. Accurate and current negative information generally cannot be removed simply because it is unfavorable.
You also have the right to dispute legitimate credit-reporting errors yourself. Never submit false information or claim identity theft occurred when it did not.
Building Credit After Derogatory Marks
Once your reports are accurate, focus on building positive credit history. Pay accounts on time, control revolving balances and be selective when applying for new credit.
It’s also useful to understand the difference between correcting negative information and adding positive account history. Our guide to credit repair vs. adding tradelines explains how the two approaches differ.
What to Do Next
If you find a derogatory item, determine whether the information is accurate before taking action. Compare your credit reports, verify the account details and document any genuine errors you find.
Dispute inaccurate information through the appropriate credit bureau or information provider. If the negative information is accurate, focus instead on preventing new derogatory marks and building a stronger credit history over time.
