Immediately Address Any Errors Or Unsubstantiated Items
Before you work on cleaning up your negative items, you first need to ensure that everything on your credit reports is accurate and current. This means checking everything from your name and address to your open accounts.
Make sure your information is correct and that you recognize each account. If you find problems with your report, such as a debt that doesnt belong to you, you can file a credit dispute with the credit bureaus to have the erroneous or unsubstantiated account removed.
The process, often called credit repair, can be done on your own online through the bureaus website. Many consumers have also found success hiring a professional credit repair company, like those below, to act on their behalf. Hiring a professional can be particularly helpful if you have many items to dispute.
| $79 | 9.5/10 |
Addressing errors in a timely manner can be especially important if you find any accounts that you dont remember opening, addresses you dont recognize, or any other signs of fraud or identity theft. But spelling errors and misreported numbers should be addressed right away, too.
For example, your creditors typically report your account balances to the bureaus each month. If a creditor reports a higher balance than you actually have, your credit score could drop thanks to an inflated utilization rate.
Summary Of Moneys Guide For Getting Negative Items Removed From Your Credit Report
- Order a copy of your credit report through AnnualCreditReport.com and search for inaccurate information, like missed payments or accounts that don’t belong to you.
- If you find any, file a dispute online or through the mail with the credit bureaus Equifax, Experian and TransUnion.
- You should also notify your bank or credit card issuer. They can help you verify that the information in your report is, in fact, erroneous and notify the bureau.
- Be on the lookout for a response from the bureau. It should arrive in around a month or less. If they accept your dispute, request your credit report again to make sure the negative information was removed.
- If your report is riddled with errors or you’re finding the dispute process difficult, consider hiring a .
A Basic Timetable Of The Credit Repair Process
| Step 2: Review your reports for errors | 1-2 hours, depending on familiarity with credit reports |
| Step 3: Draft dispute letters and gather documentation | A few hours to up to a week, depending on your records |
| Step 4: Await a response | Up to 30 days maximum per dispute |
| Total time required | 1-6 months, depending on the number of disputes you need to make |
Keep in mind that if you hire a credit repair service, the timetable is still the same, in total. However, most of the actual work occurs behind the scenes:
The process still takes anywhere from 1-6 months, depending on the number of disputes you need to make. The average consumer usually completes the credit repair process in about 3-6 months, but it can be less if your reports only have a few errors to correct.
Want to know more about the credit repair process before you decide?
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What Does Cleaning Up Your Credit Report Mean
When you clean up your credit, you get it in the strongest shape possible so lenders view you as a trustworthy potential borrower.
Each credit reporting agencyExperian, TransUnion and Equifaxhas its own process you can use to dispute information you believe appears erroneously. This could include personal information or accounts that do not belong to you.
Two: Review Your Reports
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Alert Creditors Of Your Updated Report
Following up with creditors and the credit bureaus will keep you updated with whether your dispute was approved or denied. If it was approved, you can quickly request that credit bureaus send updates to any financial institution that requested your report in the last six months. You can also have it sent to any potential employer who viewed your report in the last two years. This will help improve your reputation across your network without more hard inquiries.
If your dispute was denied, you can still have a note made of the dispute on your report and sent to financial institutions. Either way, make sure you ask the bureaus in writing to send those updates.
How To Verify A Legitimate Credit Repair Company
If youre thinking about working with a credit repair service, its important to choose a reputable option. Unfortunately, there are some shady companies in this industry eager to take advantage of financially vulnerable consumers, so doing your due diligence is essential.
Each company on our list is reputable and abides by Credit Repair Organizations Act regulations, but if youd like to shop around further, you can start by looking at the CFPB Complaint Database. This database lets you review complaints about companies that consumers have logged with the CFPB since 2011. However, a lack of complaints doesnt necessarily indicate a good company reputationa company must respond to a complaint for it to be listed on the CFPB, so companies can avoid listings by not responding.
While it may be tempting to use services like the Better Business Bureau to research companies, thats generally not the best approach. Companies can pay to become accredited on the BBB platform, which could make them seem more legitimate than they actually are.
If you suspect a credit repair company youve come across is scamming customers or otherwise engaged in fraud, you can report them to the FTC.
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Is Pay For Delete Legal
The Fair Credit Reporting Act governs credit reporting laws and guidelines. Anything that a debt collector, creditor, or credit bureau does regarding a credit report will be based on the FCRA, says Joseph P. McClelland, a consumer credit attorney in Decatur, Ga.
Technically, pay for delete isnt expressly prohibited by the FCRA, but it shouldnt be viewed as a blanket get-out-of-bad-credit-jail-free card. The only items you can force off of your credit report are those that are inaccurate and incomplete, says McClelland. Anything else will be at the discretion of the creditor or collector.
The Impact Of Identity Theft On Your Credit Report
Identity theft when someone steals your personal information and uses it to open new financial accounts can wreak havoc on your credit. These new accounts show up on your credit record and hurt your score, especially if theyre delinquent or if the identity thief applied for several in a short amount of time.
Cleaning up your credit after identity theft can take anywhere from several months to years. The longer it takes you to realize someone stole your identity, the more difficult it will be to undo the damage. This is why keeping a close eye on your report and learning how to protect yourself from identity theft will help you to keep your information safe.
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Ask For A Goodwill Deletion
If you have good relationships with your creditors, then you may be able to talk them into clearing your credit history of delinquencies and late payments by sending them whats known as a goodwill letter.
This method is a long shot, but it costs nothing to try, which makes this one of several ways to wipe your credit clean for free. Create your letter using this template:
Goodwill Letter to Creditor
Use this goodwill letter template to ask for a goodwill deletion from one of your creditors. Remember to customize it to your circumstances for the best possible chance of success.
When you ask for a goodwill deletion, youll need to explain to your lenders why you fell behind on your payments and how the black marks on your credit history are negatively affecting your life.
You should also reassure them that you take your debt obligations seriously and that you wont make the same mistake again.
Removing Collection Accounts From A Credit Report
Whether your attempts to pay for delete are successful can depend on whether youre dealing with the original creditor or a debt collection agency. As to the debt collector, you can ask them to pay for delete, says McClelland. This is completely legal under the FCRA. If going this route, you will need to get that in writing, so you can enforce it after the fact.
What to keep in mind, however, is that pay for delete with a debt collector may not remove negative information on your credit history that was reported by the original creditor. The creditor may claim that its contract with the debt collection agency prevents it from changing any information that it reported to the credit bureaus for the account. That said, some debt collection agencies take the initiative and request that negative account information be deleted for customers who have successfully paid their collection accounts in full.
Before taking this step, consider how collection accounts may be impacting your credit score. The FICO 9 credit scoring model, for instance, doesnt factor paid collection accounts into credit score calculations. So if youve paid off or plan to pay off a collection account, then you may not need to pursue pay for delete if your only goal is improving your credit score.
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Get A Copy Of Your Credit Report
The first step in cleaning up your credit report fast is to get a copy of your credit report. You cannot clean up your credit report without seeing it.
That is why you need to get your report as soon as possible.
The Fair Credit Reporting Act requires that all three major credit reporting companies give you a free copy of your report once every year. You can either get all these reports at the same time or get one report from each company every few months. In order to get your free credit report, visit AnnualCreditReport.com or call 1-877-322-8228.
There are three major credit reporting companies in the USA which are listed below.
Having all reports at once can help you see how they differ and what is being negatively reported on each report. It will also be helpful to see whether the information reported in these reports is the same. This gives you a better idea of how you clean up your report.
If you dont like to have all three reports at once, consider having a few months between each report. For example, you can have a copy of your credit report from Experian in January, then another copy from TransUnion in April, and finally, the last copy from Equifax in September.
Keep in mind that you will get all these free reports from the website I mentioned above.
Improving Your Credit Record
If you have a history of late payments, unpaid bills, or accounts sent for collection, your credit record will suffer. A bad credit record gives you a low credit score and makes it difficult for you to get needed credit or loans for things you really need.
Your credit history
Most everything you do with credit, both good and bad, is reported to a credit reporting agency. A history of paying late, or not paying at all, is sent to credit reporting agencies. Bankruptcies, judgments, and liens also find their way to your credit report and hurt your credit rating.
The good news is that positive information is also sent to credit reporting agencies. To keep track of your credit standing, you should review your credit report at least once each year. You can correct errors and clean up any wrong information that might be on your report.
How to improve your credit rating
Here are some of the best ways to improve your credit rating:
Pay bills on time. Late payments really hurt your credit standing. It is best to pay the entire balance on your credit cards each month. If you cant, be sure to at least be paid the minimum payment on time. The more you pay each month, the less interest youll be charged.
Limit credit card use. You will hurt your credit score if you have a lot of credit cards near their credit limit. As you get closer to your credit limits, your credit score goes down. Also, applying for new credit cards lowers your credit score.
Avoid scams
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Whats The Fastest Way To Repair Your Credit
Working with a credit repair service may be the fastest way to repair your credit if you need significant assistance. While these services generally dont provide a set timeframe for improvement, many will start working on your credit right after you sign up. For instance, The Credit Pros and Lexington Law both begin working within one day.
However, even if a company starts work quickly, the results arent immediate. It will often take a few months or even longer to see changes in your credit reports and score. Still, the timeframe for improvement could be shorter than if you decided to repair your credit on your own.
How To Repair Your Credit And Improve Your Fico Scores
You can improve your FICO Scores by first fixing errors in your credit history and then following these guidelines to maintain a consistent and good credit history. Repairing bad credit or building credit for the first time takes patience and discipline. There is no quick way to fix a credit score. In fact, quick-fix efforts are the most likely to backfire, so beware of any advice that claims to improve your credit score fast.
The best advice for rebuilding credit is to manage it responsibly over time. If you haven’t done that, then you’ll need to repair your credit history before you see your credit score improve. The following steps will help you with that.
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I Need Help A Fresh Start On My Credit Is There A Do Over Approach
Heres the good news: The effects of negative information on your credit scores will lessen over time. As you wait for your scores to rebound, focus on establishing smart spending habits. For instance, pay off those high credit card balances. You can also look into taking out a secured credit card or credit-builder loan to reestablish a good payment history. Review your budget to look for extra dollars that could potentially be put towards paying down your debts. A deep dive into your finances could help you identify and fix the issues that were causing you to miss payments or run up big loan balances in the first place.
And, of course, you can build and maintain good credit in the long-term. Do this by making all loan payments on time. Keeping debts low. And adding a mix of accounts . As your credit reports freshen up and your credit scores rebound.
Need more info on the ins and outs of credit, Creditly offers a free resource page to keep you busy!
Dispute Mistakes The Right Way
If you find a major mistake, order your credit report from all three credit bureaus to determine whether the problem is limited to just one report. Then, determine whether you need to take up your dispute with the credit-reporting bureau or the lender. If theres someone elses information on your report, or there are accounts listed that arent familiar to you, contact the credit bureau. All three bureaus have online dispute forms to help you quickly resolve credit-report errors.
Taking things up with the bureau is easier because they have one set process, says author and personal finance expert Steve Bucci. Theres a dispute process in place so you can dispute any account with the same process, whereas when you contact the creditor, everyones a little different. Its not as neat and simple.
If there is negative information thats more than seven years old or an outstanding balance that has been paid off, contact the lender directly.
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Who Can I Talk To For Help
Contact your state or local consumer affairs bureau and ask them about resources available in areas like debt management, credit cleanup, credit correction, and debt counseling.
You can also contact, and file a complaint with, the Federal Trade Commission, the agency in charge of promoting consumer protection and eliminating anti-competitive business and lending practices.
Seek the help of a nonprofit specializing in alternatively, you can reach out to a for-profit debt management company. Contact your states Department of Financial Services or the Better Business Bureaus local branch in your residence area. Give priority to debt organizations that are registered with state officials and the BBB.
Get legal representation, especially if the amount under dispute is substantial. Seek a lawyer who is familiar with the intricacies of debt management and has covered cases of credit cleanup in the past.