When you close an account, it may not be removed from your credit report immediately. This is true whether the closed account is a credit card or an installment loan.
Closed accounts stay on your report for different amounts of time depending on whether they had positive or negative history. An account that was in good standing with a history of on-time payments when you closed it will stay on your credit report for up to 10 years. This generally helps your credit score. Accounts with adverse information may stay on your credit report for up to seven years.
Adverse information is anything that a potential creditor might see as negative, such as late payments or accounts that go to collections. Both late payments and collections will fall off your credit report seven years after the date of the original delinquency. A common misconception is that a collections account will fall off a credit report once it’s been paid. Whether paid or unpaid, a collections account will stay on your credit report for up to seven years. One special case is for New York residents for which paid collections will fall of their credit reports after 5 years.
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