If your credit card account was charged off in 2002 but the credit bureaus are reporting a last reported date of 2005 is this legal and can it be corrected?

Creditors can and often will update negative information. It is my understanding that they have the right to do so. If there is no activity from the creditor for seven years, the charge off will drop off your credit report. Also, charge off's need to be paid if you want to get good credit. You often can make a settlement with the creditor. Start by offering half of the amount owed. The "date last reported" is simply the last time information was supplied or verified to the credit bureau. It has no impact on the time period a charge off may be displayed on your personal report and is completely legal. This is a common side effect of disputing inaccurate information on your credit report. The Data Furnisher "investigates" and then updates the account listing. But the date the account was last paid, or charged off, doesn't change.

Updating older charge offs like this does, however, cause a significant deduction in your credit score. Credit scoring software deducts for DLR on derogatory items because they appear to have happened recently. Scores are all about your perceived risk as a borrower. Recent derogatory activity thus translates into larger deductions. There is nothing you can do to change the way it's reporting.