I have something showing on my credit report called derogatory. Can you please explain to me what that means?
A derogatory item is considered negative, and typically indicates a serious delinquency or late payments. Derogatory items represent credit risk to lenders, and therefore, are likely to have a substantial effect on your ability to obtain new credit.
Public record items, such as bankruptcies, tax liens, and judgments also are considered derogatory. Other examples of derogatory credit items include collection accounts, charge-offs, and accounts that are settled for less than the full balance.
While some lenders still may be willing to extend credit to someone with derogatory items on their report, they may do so with less than favorable terms, such as higher interest rates or fees.
Thanks for asking.
The “Ask Experian” team