Clients will commonly have questions about the Date of Last Activity (DLA) on their credit reports. Whether you’re just starting a credit repair company or are a seasoned professional, it is important to understand what a DLA means on a credit report, how collections companies use it, and how it can be used to hurt your clients.
What is a DLA?
The Date of Last Activity (DLA) listed on a client’s credit report is updated when one of three things happens on any active account:
- the consumer makes a payment
- the consumer misses a payment
- the balance of the account increases
The DLA used to include the “purge from” date, or the date the item will be removed from the report, but this has recently changed. The “purge from date” is now a separate item on the report (and often not on the report at all).
Who controls the DLA?
The DLA is not updated by the original creditor or the debt collector, it is controlled by the credit bureaus. However, creditors and debt collectors are responsible for reporting information to the bureaus that will them update the DLA.
How can debt collectors use a DLA to hurt consumers?
Some debt collectors have been known to make regular changes to clients’ accounts, which triggers a balance increase to be sent to the bureaus and changes the DLA. This can hurt a client’s credit report. Bureaus may do this to intimidate consumers in hopes of pressuring them to pay.
How can I help my client with their DLA?
When combing through your client’s credit report, pay special attention to the DLA. Make sure that the DLA reflects the actual date that a payment was made, missed, or the balance increased. If it is not, begin the basic dispute process to have the item changed or deleted.
Can the DLA affect when an item will eventually fall off a credit report?
No, the date of first delinquency is what is used to determine when the item will be deleted. Important DLA facts to know:
- Contrary to popular belief, the DLA has nothing to do with when an item will be deleted from the credit report
- Making payments on a past due account does not change the date of first delinquency and does not reset the clock, so unless the item is about to fall off the report, it always pays to catch up on late payments to bring a past due account current
- Collection accounts are deleted 7 years from the date of first delinquency of the original account
- Collections accounts are always associated with the original account so they must be deleted the same time
- The further in the past a delinquency occurred, the less impact it can have on a credit score
As a credit repair professional, remaining informed about updates and changes in the credit repair landscape is crucial. By staying up to date about the DLA and other information, you will be able to serve as a trusted advisor and help your clients reach their credit goals. Use your credit repair business software to help you stay on top of important changes in your client's credit report.
For more, check out our ultimate guide for running your credit repair business.