Derogatory Marks: What They Are & How They Hurt Your Credit
Your credit score just dropped — and now there’s a “derogatory mark” on your report. What does that mean, and how bad is it?
A derogatory mark is any negative information on your credit report that shows you may be a risk to lenders. It could be a missed payment, a defaulted loan, or a bankruptcy. These items don’t just hurt your credit score—they can follow you around for years.
This article breaks down exactly what counts as a derogatory mark, how long each type stays on your credit report, how much damage it can do to your credit score, and what steps you can take to bounce back.
What Is a Derogatory Mark?
A derogatory mark is a negative item on your credit report that signals to lenders that you’ve had trouble paying back debt. It tells them you may be less likely to repay a loan on time, which makes you a higher risk.
These marks are a red flag in the eyes of lenders, credit card companies, and even landlords or insurers. They lower your credit score and can make it harder to qualify for new credit, especially at competitive interest rates.
Common Types of Derogatory Marks
Derogatory marks can show up in several different forms, and each one affects your credit differently. Here’s a breakdown of the most common types.
Late Payments
Late payments appear on your credit report once a payment is more than 30 days past due. Lenders typically report them in 30-day increments—30, 60, 90, or 120+ days late.
They stay on your credit report for seven years from the original delinquency date. Even a single late payment can cause a noticeable dip in your credit score, especially if your credit history is otherwise clean.
Charge-Offs
A charge-off happens when a lender gives up on trying to collect a debt and writes it off as a loss. That doesn’t mean the debt goes away—you still owe the money, and the lender can sell the account to a debt collector.
Charge-offs stay on your credit report for seven years. They hurt your credit score significantly and signal to future lenders that you failed to pay a debt altogether.
Collections
Collections occur when a creditor hands your unpaid debt over to a collection agency. You’ll typically see the original creditor’s account marked as closed or charged off, and the collector will report the debt as a new account.
Collections stay on your credit report for seven years from the original delinquency date. They can lower your credit score and may trigger calls or letters from debt collectors.
Bankruptcy
Bankruptcy is a legal process that helps you eliminate or restructure debt when you can’t repay it.
- Chapter 7 bankruptcy stays on your credit report for 10 years from the filing date.
- Chapter 13 bankruptcy stays for 7 years.
Bankruptcy has one of the most damaging effects on your credit, but it can also provide a reset if your debt has become unmanageable.
Foreclosure & Repossession
Foreclosure happens when a lender takes back your home after you fail to make mortgage payments. Repossession is similar, but typically involves vehicles.
Both stay on your credit report for seven years and can severely hurt your ability to qualify for future housing or auto loans.
Tax Liens & Civil Judgments
While new tax liens and civil judgments no longer appear on credit reports due to updated reporting standards, older reports may still include them.
If present, they can hurt your credit score and stay on your credit report for up to seven years. If you paid or settled these public records, that may improve your standing with lenders, even if the item remains visible.
How Derogatory Marks Affect Your Credit Score
Derogatory marks impact your credit score more than almost anything else. Both FICO and VantageScore models weigh payment history heavily—making up about 35% of your score in most cases.
Once a derogatory item hits your credit report, the impact is usually immediate. A single missed payment could drop your score by 50 to 100 points. If you have multiple derogatory marks, the damage stacks up.
The more recent the mark, the more weight it carries. Over time, the effect fades, but the item still limits your ability to qualify for top-tier credit cards, low-interest loans, or mortgage approvals.
Multiple derogatory marks can leave you stuck with subprime options or outright denials until you take steps to rebuild your credit. That’s why it’s so important to address them head-on.
How Long Derogatory Marks Stay on Your Credit Report
Different types of derogatory marks stay on your credit report for different lengths of time. Here’s a quick overview:
| Type of Derogatory Mark | How Long It Stays on Your Credit Report |
|---|---|
| Late Payments | 7 years from the missed payment date |
| Charge-Offs | 7 years from the original delinquency |
| Collections | 7 years from the original delinquency |
| Chapter 7 Bankruptcy | 10 years from the filing date |
| Chapter 13 Bankruptcy | 7 years from the filing date |
| Foreclosure | 7 years from the foreclosure date |
| Repossession | 7 years from the repossession date |
| Paid Tax Liens (older files) | 7 years from payment date |
| Unpaid Tax Liens (older files) | 10 years from the filing date |
| Civil Judgments (older files) | 7 years from filing or payment date |
The clock starts on the date of the original delinquency—not the date the creditor reports the account or the date it moves to collections. This distinction matters if you're trying to estimate when a mark will fall off your credit report.
Can You Remove a Derogatory Mark From Your Credit Report?
Some derogatory marks can be removed, but it depends on whether the information is accurate.
Inaccurate Marks
If a derogatory item is incorrect—such as a debt you didn’t incur or a payment marked late that wasn’t—you can file a dispute with the credit bureaus.
- Start by requesting your credit report from all three credit bureaus (Equifax, Experian, and TransUnion).
- Submit a dispute online or by mail, clearly stating the issue.
- Include supporting documents such as account statements, payment confirmations, or letters from the creditor.
If the bureau can’t verify the item or the information is proven false, it must be removed.
Valid Marks
If the mark is accurate, you still have a few options:
- Goodwill letter – You can ask the creditor to remove the item as a goodwill gesture, especially if it was a one-time mistake and you’ve since been in good standing.
- Pay for delete – Some collection agencies will agree to remove a collection account if you pay the balance. This isn’t guaranteed and should be requested in writing.
- Wait it out – Most derogatory marks eventually fall off your report within 7 to 10 years, and their impact fades over time, especially if your newer credit activity is positive.
How to Rebuild Credit After Derogatory Marks
Even if a derogatory mark stays on your credit report, you can still take steps to improve your credit score.
- Make on-time payments – Payment history is the most important factor in your credit score. Set up reminders or auto-pay to avoid missing due dates.
- Use a secured credit card or credit-builder loan – These tools are designed for rebuilding credit. Make small charges and pay them off in full each month.
- Keep credit utilization low – Try to use less than 30% of your available credit. High balances can hurt your score even if you pay on time.
- Monitor your credit regularly – Keeping an eye on your reports helps you catch errors early and track your progress over time.
Consistency is key. Even with past damage, building a strong track record going forward can move your score in the right direction.
When to Get Professional Help
If you're overwhelmed or unsure where to start, a credit repair company might be worth considering.
- You may benefit from help if you're dealing with multiple errors, old debts that keep popping up, or if you simply don’t have the time to handle disputes on your own.
- Look for a reputable service that offers transparent pricing, clear timelines, and no guarantees of specific outcomes (which are illegal).
- Avoid scams by steering clear of companies that demand upfront payment, tell you to lie to the credit bureaus, or push “new identity” services.
A legitimate credit repair company can help streamline the process, but it’s not a magic fix—and everything they do, you can legally do yourself.
Final Thoughts
Derogatory marks can drag down your credit score and limit your financial options—but they don’t last forever.
Knowing what these marks mean, how long they stick around, and what you can do to deal with them puts you in control. Whether you’re disputing errors, making goodwill requests, or just rebuilding your score step by step, there’s always a path forward.
Check your credit reports often, take action where you can, and don’t let a past mistake define your future. Credit damage is temporary. Good habits going forward make a real difference.
