Dirty to Clean File With Existing Account

[Anonymous]

I read a post today that prompted me to ask this question I have wanted to know the answer to for a long time.

Scenario: you have a major derogatory mark like an old charge off from Bank A; while the old account is showing on your credit report you apply and are approved for a new card from Bank B.  Once the derogatory account ages off how does Bank B, the card issuer, look at your file?  I cannot imagine they totally forget about the past dirty account. 

How does this work?

Thanks

[Anonymous]

I suppose it would depend on how Bank B keeps records internally.  Major negative items generally fall off of reports after 7 years, so after that time they're more or less considered obsolete and no longer an indicator of present increased risk.  That being said, most lenders wouldn't care IMO.  Current data > old data.  Bank A however in your example no doubt will keep internal records of any negatives from their own accounts, so even 20 years from now they may very well see that one didn't pay as agreed with them.

[Kforce]

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* This is just an opinion, as I have no real knowledge in this area. *

Most institutions pull data monthly from one or more of the credit reporting agency's to supplement the data they track with your account.   They would not need to track info that they are spending money getting from another source.   I would think when it falls off from the credit bureau reports, it will not be seen by Bank-B.   However your bad history with Bank-A might be in Bank-A's  database forever.

* Remember this is just from my crystal ball *