HOW LONG DOES A FORECLOSURE STAY ON A CREDIT REPORT
I was reading Mortgage Market Weekly and I came across this question: How long does a foreclosure stay on a credit report? Here is their answer:
Answer: With regard to an individual’s credit, a foreclosure is deemed a very serious delinquency, and one that will stay on your credit report for up to seven years (typically from the date of the banks filing).
I will hit your credit scores hard, likely dropping them 150 points or more.
Keep in mind, however, as time goes by and you keep your other credit good, your credit score will inch up; keeping good (timely) credit after a foreclosure is the most important thing to keep in mind in recovering your credit scores.
Having a foreclosure recorded on your credit report does not necessarily mean that you cannot obtain mortgage or other financing for seven years, but it does mean creditors will be able to see the red flag and punish you accordingly (typically via higher interest rates and additional down payments).
Also, keep in mind that even if you meet the bank or lender’s requirements for past foreclosures, an underwriter could still determine that you are too risky for a subsequent mortgage or other credit if you have other late payments after a foreclosure.
Please take note that if you are facing or considering foreclosure, that the longer you put off foreclosure, the longer the recovery period; I am not saying ‘give in’, just keep it in mind.
Like any other derogatory credit account, it is possible to get a foreclosure removed from your credit report, though you will likely need a very compelling reason and a whole lot of time to do it.
