How to Get a Closed Account off Your Credit Report

A woman cuts up a credit card
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Many people close credit accounts they no longer want, thinking that doing to removes the account from their credit report. The Fair Credit Report Act—the law that guides credit reporting—allows credit bureaus to include all accurate and timely information on your credit report. Information can only be removed from your credit report if it's inaccurate, outdated, or the creditor agrees to remove it.

What Happens When You Close an Account?

When you close an account, it's no longer available for new transactions, but you're still required to pay off any balance you still have due by paying at least the minimum due each month by the due date

After the account is closed, the account status on your credit report gets updated to show that the account has been closed. For accounts closed with a balance, the creditor continues updating account details with the credit bureaus each month. Your credit report will show the most recently reported balance, your last payment, and your monthly payment history.

Removing Closed Accounts From Your Credit Report

In some cases, a closed account can be harmful to your credit score. This is especially true if the account was closed with a delinquency, like a late payment or, worse, charge-off.

Payment history is 35% of your credit score and any late payments can cause your credit score to drop, even if the payments were late after the account was closed.

Removing the account from your credit score could potentially lead to a credit score increase.

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Removing a closed account from your credit report isn't always easy, and is only possible in certain situations.

If the account on your credit report is actually open but incorrectly reported as closed, you can use the credit report dispute process to have it listed as an open account. Providing proof of your account status will help your dispute.

Having a credit account reported as closed (when it's actually open) could be hurting your credit score, especially if the credit card has a balance. You can dispute any other inaccurate information regarding the closed account, like payments that were reported as late that were actually paid on time.

Goodwill Letter

You can use a goodwill letter to request a creditor remove a closed, paid account from your credit report.

Creditors don't have to give in to a goodwill request, no matter how nicely you ask, but you may get lucky and find a creditor who's sympathetic to your request.

Pay for Delete

For accounts with balances, the "pay for delete" strategy can help you remove a closed account from your credit report. The pay-for-delete letter offers full payment of the outstanding in exchange for removing the account from your credit report.

Again, creditors don't have to comply. Occasionally some creditors and debt collectors agree to the arrangement with payment as incentive to remove the account from your credit report.

You can send your goodwill or pay for delete letter directly to the creditor by mail. In some cases, you can try contacting the creditor by phone first to make your request.

Wait for Accounts to Drop Off

If you choose not to take steps to remove closed accounts, you'll be happy to hear that these closed accounts won't stay on your credit report forever. Depending on the age and status of the account, it nearing the credit limit reporting time limit when it will drop off your credit report for good. If that's the case, all you have to do is wait a few months for the account to fall off your credit report and then for your credit report to update.

Most negative information can only be listed on your credit report for seven years from the first date of deliquency.

If the closed account includes negative information that's older than seven years, you can use the credit report dispute process to remove the account from your credit report.

No law exists that requires credit bureaus to remove a closed account that's accurately reported, verifiable and doesn't contain any old, negative information.

Instead, the account will likely remain on your credit report for ten years or whatever time period the credit bureau has set for reporting closed accounts. Don't worry, these types of accounts typically don't hurt your credit score as long as they have a zero balance.

Article Sources

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  2. Consumer Financial Protection Bureau. "Is It Possible to Remove Accurate, Negative Information From My Credit Report?" Accessed Nov. 2, 2020.

  3. Consumer Financial Protection Bureau. "I Want to Close My Credit Card Account. What Should I Do?" Accessed Nov. 2, 2020.

  4. Consumer Financial Protection Bureau. "Key Dimensions and Processes in the U.S. Credit Reporting System: A Review of How the Nation’s Largest Credit Bureaus Manage Consumer Data," Page 3. Accessed Nov. 2, 2020.

  5. Consumer Financial Protection Bureau. "Key Dimensions and Processes in the U.S. Credit Reporting System: A Review of How the Nation’s Largest Credit Bureaus Manage Consumer Data," Page 8. Accessed Nov. 2, 2020.

  6. Consumer Financial Protection Bureau. "Will Closing Credit Cards I Already Have Increase My Credit Score?" Accessed Nov. 2, 2020.

  7. MyCreditUnion.gov. "Your Credit Score." Accessed Feb. 11, 2020.

  8. Consumer Financial Protection Bureau. "Disputing Errors on Your Credit Reports," Page 1. Accessed Nov. 2, 2020.

  9. National Foundation for Credit Counseling. "Ask An Expert: How Do I Remove Negative Remarks on My Credit Report?" Accessed Nov. 2, 2020.

  10. Consumer Financial Protection Bureau. "How Long Does Negative Information Remain on My Credit Report?" Accessed Nov. 2, 2020.