5 Reasons Debts In Collections May Have Disappeared From Your Credit Report | Refresh Financial

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5 Reasons Debts In Collections May Have Disappeared From Your Credit Report

It doesn’t matter why you had debts in collections. Perhaps you were young with limited knowledge of how to manage credit. Maybe you got laid off and simply could not pay everything you needed to. There are so many ways we can have a debt end up in collections and it is not fun to see it lurking there on your credit report for years and years.

What if that debt that went to collections suddenly disappears from your credit report? What does that mean? Is it gone for good? Do you have to worry about it popping back up again?

When a debt that went to collections is suddenly gone from your credit report, it can be one of many reasons. Here are 5 of the most common ones:

1. Six years have passed

Defaulted debts usually disappear from your credit report after six or seven years, depending on which credit bureau it's listed with. This is because of the statute of limitations, which you can read more about here. This includes accounts in collections, bankruptcies, and consumer proposals. If the debt you have in collections is six years or older, this could be why it’s suddenly gone from your credit report. However, this is not a free pass to go out and screw up your credit again. These rules are in place to enable people to improve their credit and get on their feet financially, even after making huge mistakes. Use this as an opportunity to take your credit seriously and work hard to achieve a better credit score.

2. A new collection agency bought the debt

Sometimes debt changes hands and you might have glanced at your credit report during a sort of “in-between” period. You will likely see the debt appear on your credit report again soon.

3. Someone else paid the debt without your knowledge

Maybe one of your parents did it and didn’t want to make a big deal of it. Perhaps it was another loved one or a close friend who knew of the debt. In this case, the debt won't actually "disappear" from your report, but it will say that it was settled, and will no longer show up as unpaid.

4. Human error

Somewhere along the line, a mistake was made that removed the debt from your credit report. It’s an error that definitely works out in your favour, but don’t be shocked to see the debt reappear in the future.

5. Computer glitch

Yes, even the major financial institutions and credit bureaus can have problems with their computer systems. The thing is, though, companies like this have backups and more backups of those backups and even more backups of those backups. Chances are if computer error is the cause of your debt disappearing from your credit report, you caught it at the precise moment the glitch occurred. It will be fixed momentarily as the credit bureaus and financial institutions restore your file from backups.

Whatever the reason for your debts in collections disappearing, be cautious going forward. There is a good chance, unless the statute of limitations is up, that you will see the debt reappear shortly. And remember, just because the debt disappears from your credit report after those six years, it doesn't mean your credit score will magically shoot up. Building your credit score up after having delinquent accounts takes time and patience.


Refresh financial offers custom credit building solutions to help you build your credit score FAST.

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