Short-term loans are emergency installment loans (although they can have repayment terms of up to 3 months) and payday loans (need to be paid off by the coming paycheck day). When a borrower gets funds through such small cash loans, mostly private lenders do not bother to report credit agencies like Equifax, Experian, and TransUnion. It is only when large-scale borrowing takes place that reporting credit transactions makes sense. However, some lenders report this financing too. They then appear on the credit reports and add to the credit history, which is good.
In addition, debt collectors or lenders may report late repayments when borrowers fail to inform them. In this case, the reporting impacts the credit rating negatively.
How Long Do Installment Loans Stay on Credit Report?
The duration of an installment loan is reported on your credit history, depending on your current loan status and payment record. When you’ve successfully paid off an installment loan, the account can stay on your credit report for a maximum of 10 years from the date of last activity (DLA). For individuals with active loans and a track record of late payments, the details of those late payments typically persist on the report for up to 7 years. Likewise, overdue installment loans marked “not paid” are commonly listed for 7 years. In the case of an installment loan that has been handed over to a collection agency, its appearance on your credit report generally extends up to 7 years from the date it initially became past due. Regularly monitoring your credit report is advisable to ensure its accuracy and promptly address any discrepancies.
If you want to know whether installment loans show up on your credit report for a long time, then we have a definite answer for you. As we mentioned, only not making timely payments might hurt your credit; taking out a loan is just fine. Therefore, if you are paying off the installments or making a bulk payment on time and the lender is reporting the payments to the agencies, it is good for you if they show up in your report for a long time.
Similarly, unruly payments can also hunt you if you need large amounts of funding.
In general, if the lender or debt collector reports the borrowing or late payment, installment loans stay on the credit report for 7 years, which is a considerable amount of time. In some cases, they can stay on for up to 10 years. Therefore, you can have the positive impacts of the reporting for up to a decade if you prove to be a responsible borrower by adhering to the due dates. However, with bad credit as well, you can get an installment loan from CashAmericaToday with a 3-minute application process online.