California Credit Law Blog

The Fair Credit Reporting Act prohibits credit bureaus from reporting most debts more than seven years old. The seven year clock starts ticking from the date of first delinquency.

Confusion about the date arises when the consumer brings a delinquent account current and then the account becomes delinquent a second or third time. The account will then have more than one date of first delinquency. The report of the first delinquency will remain 7 years and then fall off the reports. The report of the second and third delinquencies will run 7 years after those events. Most accounts become delinquent and stay that way.

If the account is sold to a debt buyer, the 7 year calculation does not change. Some debt buyers illegally re-age accounts to keep it on the consumer's credit reports. Victims of this practice have a valid claim for damages if their dispute letters to the credit bureaus do not get results.

There are many ways you may inadvertently lower your credit score. One way is renting a car with a debit card. Consumer advocate Lynnette Khalfani-Cox writing for AOL’s WalletPop: says that paying for a car rental with a debit card can actually HURT your credit rating. The reason is that most rental contracts give the rental car company the right to check your credit rating if you use a debit card instead of a credit card. Each time someone checks your credit rating, its a negative – just like if your are seeking a loan.

Here are 9 other innocent actions you may take that may also damage your credit score:

Saying Yes to a Department Store Credit Card
Closing a Credit Card With a Zero Balance
Having a Credit Card Company Not Report Your Credit Limits
Disputing a credit card bill
Paying off an old debt or an account in collection
Buying a new motorcycle
Using a business credit card
Having multiple names listed in your credit reports

House Republicans are trying to kill or cripple the Consumer Financial Protection Bureau before it goes into business. An article in the Nation reports on their attacks on the new agency and Elizabeth Warren, the acting director of the agency.

The banks and finance company are contributing lots of money to the House Republicans who then do their bidding. The Center for Responsive Politics identified 156 groups engaged in such lobbying after the Dodd- Frank Act creating the Bureau was passed while the Chamber of Commerce still has a dozen lobbyists working solely on Bureau matters. The American Bankers Association has only 11 lobbyists.