I listened to a pretty terrible webinar this afternoon designed to teach mortgage lenders the "inside secrets" about how credit scores "really" work. I just love to torture myself listening to self-proclaimed experts spouting inaccurate credit advice. Misinformation such as hard inquiries causing a 3-point score drop each and that a paid off mortgage record will hurt your credit score.
One thing mentioned during the webinar did catch my attention, though. The speaker said that:
the reason negative records expire from your credit reports after 7 years is biblical. The bible said that debts should be forgiven after 7 years.
Hmmm…this is interesting. I’ve never heard of this bible/Fair Credit Reporting Act connection before. A quick Google search turned up the following passage:
"At the end of every seven years you shall grant a release of debts. And this is the form of the release: Every creditor who has lent anything to his neighbor shall release it; he shall not require it of his neighbor or his brother, because it is called the LORD’s release" (Deuteronomy 15:1-2).
I suppose it is possible that there’s a connection here. US bankruptcy laws preceded the Fair Credit Reporting Act. If there was a direct connection to scripture it would probably be from these earlier regulations that carried over into the FCRA.
I’ll have to do a little more research on this. Are there any biblical scholars or colonial historians out there with information to share?
Emily Davidson
is editor of CreditBloggers.com and a former credit expert for the
credit bureau, TransUnion. She writes about credit and personal finance
topics.
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There’s some great information on the history of debt at the Myvesta website:
http://myvesta.org/history/