Foreclosure is one of the most stressful events that a person can experience. In addition to having to grapple with the loss of your home, you also have to deal with the other repercussions of a foreclosure, including the negative impact on your credit score. The degree to which a foreclosure affects your credit score depends on a number of factors, but it’s common for a foreclosure to lower your credit score by at least 100 or even 150 points. This can affect whether you’ll be able to qualify for additional credit and loans in the future.
If you’ve fallen behind on mortgage payments or you’ve already received an official foreclosure notification, you may be wondering exactly how long a foreclosure will stay on your credit report. A foreclosure will stay on your credit report for as long as seven years. However, this period of time isn’t calculated from when the lender initiates foreclosure proceedings against you. Instead, the seven years starts to run on the date of the first missed payment that led to the foreclosure.
So, even though a foreclosure entry won’t appear on your credit report until after your lender takes action, the commencement of the seven-year period will be backdated to the time of your first missed payment. Once seven years have passed from that date, the foreclosure entry should automatically be removed from your credit report.
What Happens If the Foreclosure Stays on Your Credit Report Past That Date?
Although a foreclosure should automatically disappear from your credit report after seven years, that doesn’t always happen. If seven years have passed from the date of your first missed payment and you’re still seeing the foreclosure entry on your credit report, the error can be challenged by filing a dispute with the credit reporting agency. Once the dispute is filed, the agency will have 30 days to investigate the circumstances. We can help in this process, and we can even sue the credit agencies to correct the error and recover damages if they won’t remove it after proper notice.
How to Rebuild Your Credit Score
It’s important to remember that even though a foreclosure will stay on your credit report for as long as seven years, you don’t need to wait until that period is up to start repairing your credit score. As soon as you can, start paying all of your bills on time and reduce your credit utilization ratio (how much credit you’ve used compared to the total limit available). Although the foreclosure entry will still be on your credit report, it will have less and less of an impact over time and will gradually be overshadowed by the positive steps you’ve taken since then.
Experienced Foreclosure Defense Attorneys Representing Clients in Pasco & Hernando Counties
If you’re in the midst of foreclosure proceedings and you’re unsure what to do next, you can turn to the foreclosure defense attorneys at The Lyons Law Group, P.A. We’ve been serving clients across Tampa Bay since 2008, and we can provide you with valuable information about how to avoid a foreclosure and save your house, whether that involves negotiating a loan remodification, entering into a forbearance agreement, committing to a repayment plan, or pursuing another strategy.
We offer free initial consultations and we’d love the opportunity to talk with you, provide you with additional foreclosure information, and discuss your legal options for how to move forward. Contact us today to schedule an appointment on the phone or at either of our offices in New Port Richey and Spring Hill, Florida.