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Fall off date: 7 years or 7.5 years?

Valued Contributor

Fall off date: 7 years or 7.5 years?

I've read that the 7 year countdown started 6 months after the DOFD (date of first delinquency), which would mean 7.5 years. But then I've also heard it's simply 7 years...and the credit reports seem to confirm that (or even earlier).

 

The ones that have already fallen off previously had a date of 02/2013 but fell off 4 months early.

 

Message 1 of 7
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Community Leader
Epic Contributor

Re: Fall off date: 7 years or 7.5 years?

FCRA 605(c) is explicit.

The required exclusion date begins 180 days after the DOFD, and runs 7 years from that date.

 

That tortured statutory language, which is certainly not the way the period would have been defined had it origially been incorporated into the FCRA, is based on the original construction of FCRA 605(a)(4), which defined the exclusion date for a collection or charge-off as 7 years from the date "placed for collection or charged to profit and loss."

 

The credtior and debt collector community, as well as the CRAs, were interpreting that original language to mean that the date of collection activity began the period.

Congress intervented back in 1998 by adding section 605(c) to clarify the dates.

In their wisdom, or lack therof, they chose not to amend the language of original section 605(a)(4), but rather to keep the original 7 years referenced in that section, and define the date of commencement of the period.  Thus, the resulting language "upon the expiration of the 180-day period beginning on the date of the commencement of the delinquency which immediately preceded the collection activity, charge to profit or loss, or similar action."

 

DOFD plus 180 days begins the running of the 7 year period set forth in section 605(a)(4).

In just plain English,the period is 7 years plus 180 days from the DOFD on the OC account.  The legislative history as well as numerous FTC staff opinion letters and subsequent case law all support that unambiguous defintion.

 

A DOFD of 2/2006 does not have a compulsory credit report exclusion date until after 8/2013.  The exclusion date is the maximum period permitted by section 605(c), and does not preclude a CRA from excluding at an earlier date.  They appear to exclude prior to the maximum statutory date in order to reduce any chance of being in noncompliance with the statute.

Message 2 of 7
Valued Contributor

Re: Fall off date: 7 years or 7.5 years?

Now that, is a comprehensive answer! Smiley Very Happy

 

 

Message 3 of 7
Community Leader
Epic Contributor

Re: Fall off date: 7 years or 7.5 years?

The mysterious 180-day cushion was provided due to the concurrent enactment of section 623(a)(5), which gave any party a period of 90 days after reporting a collection or charge-off to provide the DOFD  to the CRAs.

 

It is thus possible for a collection or charge-off to be reported to a CRA very late, for example 7 years after DOFD, with no concurrent reporting of the DOFD.  Without a reported DOFD, the CRAs have no date upon which to calculate the exclusion period.  Thus, the added period of 180 days assures that the CRA will have a reported DOFD before the maximum exclusion date arrives.

Message 4 of 7
Moderator Emeritus

Re: Fall off date: 7 years or 7.5 years?

Yes, RobertEG could never be accused of giving vague answers.  Sometimes I put my glasses on so I can feel smarter when I read his replies.  Smiley Happy

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Message 5 of 7
Established Contributor

Re: Fall off date: 7 years or 7.5 years?

+1, you couldn't ask for clearer responses.



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Message 6 of 7
Valued Member

Re: Fall off date: 7 years or 7.5 years?

Did these fall off at different times on different CRAs? I had a Chase DOFD 03/2006 that fell off TU and EX this month, but not EQ. TU went first, EX about a week later and nothing on EQ. 


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Message 7 of 7