As the time comes for me to join my credit to my girlfriend/soon to be fiancee's, I have a few general questions. Don't know if we have any financial types here or not but I'll try.
When you pay off a loan or close a credit card, how long should it stay on the report? Are there state-specific limits(if so, I'm in GA) or is it like bankruptcy and stays 7 yrs? I ask because a student loan I paid off in 96 is still on there as well as a credit card I closed in 98 I believe. Any help would be most appreciated.

 

Don't know a whole lot but I believe that loans and cc's paid off are a good thing. It shows you pay your bills. Now if you were 30 days late, they can report you to credit and that is bad. I think they will stay permanent unless you write a formal requisition to have it removed since they aren't "bad" items. However, again that would be wiping out your "good" history. Everything depends on your score. 650 and up is usually considered to be ok. 680 and up good. Above 700 and we had people begging for us to get a loan through their financial institution.
Most places deny people with a lower credit score not because of "bad" items but because of a "lack of credit history".
I hope this helps and if I am wrong in any way someone please correct me.
AND ANOTHER THING!
Try to find out about her credit ie. scores, payment history, huge debt... because YOU WILL INHERIT THE PAYMENTS AND RESULT. Just lookin' out. Heard some pretty nasty stories. Also know a girl who hooked up with this guy who promised her everything. Seems and is a great guy, he just has way messed up credit and can't get a loan to save his life. She has no credit history so with the two of them going in to get a loan the banks say NO WAY.

 

While I don't have have personal experience with this, every financial guru I have heard speak on this subject says never allow the credit agencies join your report with your spouse's.

 

Your credit cards stay on forever. If you closed them it will say "closed at customers request". The longer you have had credit and as long as things are paid on time you are good. They look at availabe credit vs how much you owe. Closing credit card accounts that you owe nothing on will hurt the available credit part thus hurting your credit score.

 

Thanks guys. I already know for a fact she has credit problems from talkin to the future father-in-law but we haven't sat down and talked about it yet. Not lookin forward to it.

 

Knew a guy once that had his wages garnished by the IRS because he married and filed jointly. His lovely bride had somehow forgotten to tell him about her past dealings with tax returns. Don't be a chump, have that talk now!

 

Anything from the past 7 years is considered part of your current history, with the exception of bankruptcies, which stick around for 10. Anything derogatory or accounts older than 7 years can't be used against you to determine your eligibility for credit. Credit lines (loans, credit cards, mortgages, lines of credit, etc.) will stay in your credit history for your lifetime. Items such as collections, judgements and liens drop off after 7 years unless you settle with the party to remove the record from your credit once it is paid off.

Generally speaking, if you've maintained a reasonably good payment history for the past 24 months, that's all most banks are going to look at unless you just had ALOT of deliquent accounts or an unpaid collection account sitting out there. So one or two 30 day past due accounts from 3 years ago probably won't have much impact on you being able to get a good rate on a loan. For example, I have a credit card that I was 30 days over due on once about 4 years ago now, but my credit score is still 740.

In Georgia, if you don't apply for a loan jointly, then your spouse's credit doesn't come into play. So if her credit is in really foul shape, you'll probably end up having to borrow strictly under your name until some of the deliquent accounts start to roll off her history. Once her status improves take out a couple of small loans in her name and make a goal of getting them paid on time to help re-establish her payment history.

Like mtncrawler mentioned, it is best to put both of your finances out on the table now and see where you stand and work out a plan now for handling money and credit instead of having it come back and bite you in the butt later on down the road.

 

Thanks again everybody. She's trying to clean it up herself. She had to buy a new car last week. I told her not to take more than 7%, best she could get was 12. Ouch! But she's trying. I keep trying to find a good time to bring it up but can't seem to.

 

As stated earlier, paid off debts are a good thing and that's what you want on your credit report. Actually the more the merrier as long as you don't have delinquent payments showing. If you do have any late payments showing then it's better to get even more credit and be sure to make that monthly payment to build your score up again. Keep in mind though to not get over extended. For instance, if you owe a lot, then that might not look good. Also, if you have a bunch of credit available that you don't use, that can be bad too. The lenders look at all this stuff and apply their formulas to make their decisions. Here's a tip for your fiance to build her credit back up. Keep making the payments on time. She can also get a $100 limit on a local store credit card, buy $50 worth of stuff, and just make the minimum monthly payments for at least 6 months before paying it off. Monthly payments build a good credit score far better than paying off a credit card every month. Also, one more tip, open a new savings account at a major bank that she doesn't bank at. The banker will check to see if she is reported to Chexsystems or Telecheck. Always good to know, especially if her credit wasn't very good. Sometimes people are reported without even knowing it. Just remember that everything financially should be fixed ASAP and time and good practice will take care of the rest.