How To Get Derogatory Marks Removed From a Credit Report

A derogatory mark on your credit report can make getting approved for new credit challenging. From late payments to bankruptcies, derogatory marks may stay on your credit for up to 7 years — or sometimes 10 years for certain types of bankruptcies. 

Sometimes the only thing you can do to get a derogatory mark off your credit report is wait. But if the derogatory mark is in error or you can negotiate with the creditor, you may have options for removing it from your credit report sooner. And in any case, you can still do other things to improve your credit, so any derogatory marks have less impact on your credit with time.

Let’s look at derogatory marks, how they affect your credit, and what you can do to get past them.

What Derogatory Marks Are

Derogatory marks are negative entries on your credit report that can stay on your credit report for up to 7 or 10 years. 

These negative entries indicate you have struggled to pay your creditors on time and may not have managed your credit responsibly. Generally, a derogatory mark hurts your credit, making getting approved for credit products with good terms (or at all) difficult.

Some examples of derogatory marks on your credit report include:

• Late Payments: When you’re more than 30 days late making a payment it will be reported to the credit bureaus and reflected on your credit report. The longer your payment is late, the worse it is for your credit.
• Charged-off Accounts: When you haven’t paid an account for a few months, it may be charged off, which means a creditor doesn’t think you’ll pay what you owe.
• Collection Accounts: After an account is charged off, it may be sold to a debt collector and become a collection account.
• Debt Settlement: A debt settlement agreement may get a creditor off your back and eliminate the risk of being sued for payment. However, it will stay on your credit report for up to 7 years unless you negotiate with the creditor to remove it.
• Bankruptcies: If you file for bankruptcy, it will be reflected on your credit report as a derogatory mark.
• Foreclosures: When a lender takes possession of your home after you default on your mortgage payments, it’s a foreclosure that will reflect as a derogatory mark on your credit.
• Repossessions: Like foreclosures, a repossession that happens when a lender takes possession of your vehicle after default will stay on your credit report for up to 7 years.

Bottom Line:

Creditors may report negative entries to the credit bureaus, or credit bureaus may add public records such as bankruptcies to your credit report. 

What Derogatory Marks Do to Your Credit Score

Any derogatory mark can drag down your credit score, but how much it hurts your credit depends on various factors, such as how severe the negative entry is, how long it’s been on your credit, and what the rest of your credit report looks like.

For example, a derogatory mark from a late payment is far less severe than a foreclosure or bankruptcy. And a derogatory mark that’s just a few months old will hurt your credit more than a years-old entry. 

Payment history is the most critical factor in FICO and VantageScore credit scores. A derogatory mark from late payments, collections accounts, charged-off accounts, and other non-payment issues can hurt your credit score.

If your credit history is generally good, your positive payment history, low credit utilization, and other factors may help support your credit rating so a derogatory mark doesn’t hurt as much as it would if you have multiple negative entries or a history of struggling with credit.

What To Do About Derogatory Marks To Improve Your Credit Score

What you should do to improve your credit after a derogatory mark depends on the negative entry. For example, if it’s a late payment, get your account current as soon as possible. An account in collections or a charge-off requires a payment — and you may be able to negotiate the removal of the negative mark from your credit report in the process. 

For more severe derogatory marks, such as repossession, foreclosure, or bankruptcy, it may be best to focus on improving other areas of your credit, such as making on-time payments or having a low credit utilization ratio, to reestablish yourself as a responsible borrower.

Even if you don’t get a derogatory mark removed from your credit report, it will hurt your credit less over time. That’s especially true if you improve your credit habits and establish a history of on-time payments and a low credit utilization ratio. Eventually, your good credit habits can start to outweigh your bad credit history.

If it’s been 7 years since the date of first delinquency on an account and it’s still on your credit report, you should file a dispute to remove it from your credit report.

Hot Tip:

See our guide to learn about 10 ways to improve your credit score.

How To See Derogatory Marks on Your Credit Report

You can see derogatory marks when you check your credit report. Every week, you can get a free credit report from the 3 major credit bureaus of Equifax, Experian, and TransUnion from AnnualCreditReport.com.

You can also contact the credit bureaus through their respective websites or by phone, but you may have to pay if you order a credit report directly from the credit bureaus:

• Experian: 888-397-3742
• Equifax: 888-548-7878
• TransUnion: 800-916-8800

Additionally, some websites such as Credit Karma, Credit Sesame, and Chase Credit Journey allow you to access your credit report and credit score for free.

Once you’ve obtained your credit report, you can review it to find derogatory marks such as late payments and collections accounts.

If you don’t want to check your credit report frequently, you can sign up for credit report monitoring. For example, Credit Karma offers free credit monitoring so you can get credit alerts when there’s a change to your credit report.

How Long Derogatory Marks Stay On Your Credit Report

Generally, derogatory marks stay on your credit report for up to 7 years from the date of first delinquency. Bankruptcies stay on your credit report for 7 to 10 years, depending on the type of bankruptcy.

Remember that the clock starts when your account first becomes delinquent, not when it goes to collections. For example, suppose you’re late making a credit card payment, and it becomes so late that it’s charged off and sent to collections. In that case, the account may stay on your credit report as a derogatory mark for up to 7 years from the date of the first late payment, not when it was sold to a debt collector.

Bankruptcies are a bit different. While the accounts that may have led to your bankruptcy will remain for up to 7 years from the initial delinquency, bankruptcy will be on your credit for up to 7 or 10 years from the date the bankruptcy was filed.

How long a bankruptcy stays on your credit depends on the type of bankruptcy you file. A Chapter 7 bankruptcy can stay on your credit for up to 10 years, while a Chapter 13 bankruptcy can stay up to 7 years.

While 7 or 10 years may sound like a long time, the effect of derogatory marks on your credit report tends to lessen over time. Generally, the longer a derogatory mark is on your credit report, the less effect it has on your credit score.

Some derogatory marks may fall off your credit report before 7 years, especially if it’s a collection account you’ve paid off or negotiated to remove the account.

Removing a Derogatory Mark From Your Credit Report

There are a few ways to remove derogatory marks from your credit report, including: 

• Review Your Credit Report: First, you should know what you’re dealing with. Request your credit report and look for any derogatory marks. Identify which marks may be in error and which ones you can reasonably resolve.
• File a Dispute: If the derogatory mark on your credit report is an error or contains inaccuracies such as the wrong date or amount, or it doesn’t belong to you, you can dispute it. You can file a dispute with each of the 3 credit bureaus Equifax, Experian, and TransUnion. Be ready with evidence that the derogatory mark is inaccurate, and request that it be removed from your credit report. You may need to follow up on your dispute.
• Get Help Removing Errors: You may need legal assistance if the derogatory mark stems from identity theft, fraud, or a scam. A nonprofit credit counselor or lawyer may be able to help you get the account removed from your credit report.
• Talk to the Creditor: You can negotiate with the creditor or debt collector. They may be willing to remove the mark if you pay off the account or agree to a payment plan. This is known as a “pay for delete” agreement.
• Write a Goodwill Letter: You can write the creditor or debt collector a goodwill letter to request that the negative entry be removed from your credit report.
• Give It Time: Finally, you can just wait. Eventually — usually up to 7 years — the derogatory mark will fall off your credit report. And depending on your state’s laws, you should eventually get past the statute of limitations for debt collection, which is how long a creditor can sue you to collect on a debt.

Derogatory Marks vs. Collections

Derogatory marks and collections are related but aren’t quite the same. While collections accounts are a type of derogatory mark, not all derogatory marks are collection accounts.

In addition to collection accounts, you could have late payments, charged-off accounts, bankruptcy, foreclosure, or other derogatory marks on your credit report. These derogatory marks typically stem from non-payment on accounts, but the account may or may not have gone to collections.

Collection accounts are a specific type of derogatory mark that indicates an account has been sent to a debt collection agency, usually for failing to pay a debt. The debt collection agency then attempts to collect payment on the debt.

Do Derogatory Marks Go Away Once Paid?

Derogatory marks may not disappear from your credit report once paid, but their impact on your credit score is typically reduced over time. 

When a derogatory mark is paid, it may be updated on your credit report to show that it has been satisfied or paid in full. However, it will not be removed from your credit report immediately. Most derogatory marks can remain on your credit report for up to 7 years, even after the accounts have been paid.

Paying off a derogatory mark can still be beneficial because it shows that you have taken responsibility for your debts and are working to improve your credit standing. In addition, as time goes on and the derogatory mark becomes older, its impact on your credit score will lessen.

With some debt collectors, you may be able to negotiate a “pay for delete” agreement. In this arrangement, the debt collector agrees to remove the collection account from your credit report in exchange for payment, usually in full or for a negotiated rate.

If you’ve paid off a collection account, check your credit report to verify the account has been updated to reflect you’ve paid it. 

Should You Pay Off Derogatory Accounts?

Generally, yes, you should pay off derogatory accounts if you can. Paying off a derogatory account may improve your credit score, and creditors like to see that you’ve paid your debts — even if you got behind in the past. With paid-off accounts, getting approved for new credit should be easier.

Paying off a derogatory account can also keep you out of legal trouble. Creditors or debt collectors may sue you to collect your debts. You could face wage garnishment, property liens, and other consequences if they get a judgment.

You’ll also save on interest and fees, which creditors and debt collectors often charge on outstanding payments. 

You may relieve stress by paying off derogatory accounts, too. Collection calls for the debt should stop, and you won’t have to worry about letters or potential lawsuits once you’ve satisfied the debt.

However, if you cannot pay off derogatory accounts, you may not want to stretch too hard to make that happen. If you’re struggling with debt and paying off derogatory accounts would strain your everyday budget, you might benefit from getting help from a nonprofit credit counselor or bankruptcy attorney instead.

Final Thoughts

Derogatory marks can stay on your credit report for up to 7 years — or 10 years for some bankruptcies — but you may be able to get them removed earlier. Still, the effect of derogatory marks on your credit will fade over time, especially if you take other steps to improve your credit.

The best way to deal with derogatory marks is to do what you can to avoid them. Set reminders to pay your bills on time, and talk to your creditors if you cannot make payments. Consider options such as 0% balance transfer cards or debt consolidation personal loans to help you manage debt, or talk to a nonprofit credit counselor about your options.