Credit reports can be complicated, and it takes time to understand how they function.
One thing that confuses many people is seeing an account suddenly fall off your credit report.
If you are wondering why an account was removed from your credit report – don’t worry, most issues have an easy answer. A lot of times it may be as simple as the account falling off because it expired. With that said, there are a few more reasons an account may disappear from your reports. Understanding each may help give a more complete picture of your credit report.
Let's take a look at various reasons why an account may have been removed from your credit report.
The account has fallen off
By far, the most common reason an account gets removed from your credit report is because it has expired. A credit report is designed to be an up-to-date picture of your overall credit health and creditworthiness. Because of this, a credit report will only include your credit history for up to the last 7 to 10 years.
A closed account does not leave your credit history immediately. Whether the account was closed on good terms or bad, the account will remain on your credit report for 7 to 10 years. After this point, the account will be deleted from your credit history, taking any negative or positive impact it had on your credit history with it.
If you have recently received a notice that a closed account has been removed from your history, this is almost guaranteed to be the reason you are noticing an account has been removed from your report.
While it may seem odd, sometimes an account may accidentally be added to your credit reports. If you are receiving a notification that an account is being removed well before any of your accounts are due to expire, it may simply be that a lender or credit bureau has caught an accidental account and is removing it.
You may also receive a letter in response to you directly contacting the bureau to file a dispute.
You don’t have to do anything in either of these cases, as the notification is just there to let you know that the error is being corrected.
Mistakes happen. They may be less common in an area as technical as a credit report. However, at the end of the day, the people behind the credit companies and bureaus are still human, and can make mistakes.
Sometimes there is no reason for an account to disappear, and yet when you go to check the report it is not there. This is more than likely a mistake on the part of the lender or credit bureau.
If you think the missing account should still be included on the credit report, contact the lender first to see if it is an error on their end. If not, file a dispute with the credit bureau to get the problem solved.
Lender name change
Sometimes an account has not truly been removed from your account, it has simply been moved. This is most likely the case if your lender changes its name. I a lender changes their name, they will close your account in their old name and open a new account with their new name. It is the same account technically, but it will be from a “new” lender.
The way to check for this is to see if the old and new account have the same open date and balances, as well as other similar information. With that said, once you are sure the information regarding the account is correct, there is nothing you need to do.
Does a removed account affect your credit?
Depending on what your standing was with the account that was removed from your credit report, it may make a noticeable impact in your credit score. This is because along with the account, any information associated with the account will also be removed.
If the account was in good standing and was an older account which was helping to bring your credit score up, you may notice your credit score dip when the account is removed. Likewise an account in poor standing that expires may cause your credit score to rise.
With that said, many companies value newer credit history to older history, so some people may not notice their credit score change much at all. Again, credit reporting is very complicated, and there may be subtle differences between each bureau and how they build your credit score that make a large impact.
It is important to figure out the reason an account is being removed from your credit report. It is also important to be sure you understand why it is happening. Except for in more uncommon cases, there is not much you need to do. You may notice a temporary change in your credit score, but it should not have a long-term effect.