How long does an item stay on my credit report?
One of my credit cards has been sent to a collection agency. I read that it will affect my credit score 6 years later from the time it’s paid off. If I file a consumer proposal will that collection agency be removed from my Equifax and Transunion reports and be incorporated into the consumer proposal?
I know that if I file a consumer proposal that it’s erased 3 years later after obligation has been fulfilled. I’m also aware that I can pay a consumer proposal off earlier for example if it’s for 3 years and I pay it off in 2 years then 3 years later it’s erased how would that affect the card right now that has gone to collection?
The credit bureau reporting is not tied into bankruptcy or consumer proposal filings. Therefore, a consumer proposal will not affect the reporting on the delinquent credit card.
While it is true that reference to a consumer proposal will be removed from the credit bureau reports 3 years after satisfaction of proposal (6 years in the case of a bankruptcy) it does not mean that your credit score will be affected for that length of time.
A credit rating can be improved in about 2 years after satisfaction or the proposal or discharge from bankruptcy, to the extent that the hardest credit of all; a mortgage approval, can be acquired at the same rate as a creditworthy person, who has never been in bankruptcy.
Please refer to our page on rebuilding credit after bankruptcy or a proposal: