Can I Erase Negative Items From My Credit Report
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In a Nutshell
The Fair Credit Reporting Act gives you the right to dispute inaccurate negative items on your credit report, but you don’t have a right to remove accurate items. Yet, there still may be some things you can do about negative items even when they are accurate. This article will discuss what you can do about negative items on your credit report and how to find and dispute inaccuracies on your credit reports. Weâll also touch on requests to remove items through pay-for-delete negotiations and goodwill letters.
Written byAttorney John Coble.
The Fair Credit Reporting Act gives you the right to dispute inaccurate negative items on your credit report. You have a right to good faith disputes. If you prevail in the dispute, the credit bureaus must remove the item from your credit reports. You don’t have a right to remove accurate items. Yet, there still may be some things you can do about negative items even when they are accurate.
How To Remove Derogatory Items From Your Credit Report
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Strategies To Remove Negative Credit Report Entries
Negative details on your are unfortunate glaring reminders of your past financial mistakes. Or, in some cases, the mistake isn’t yours, but a business or credit bureau is to blame for credit report errors. Either way, its up to you to work to have unfavorable credit report entries removed from your credit report.
Removing negative information will help you achieve a better credit score. A better credit report is also the key to getting approved for credit cards and loans and to getting good interest rates on the accounts that youre approved for. To help on your way to better credit, here are some strategies to get negative credit report information removed from your credit report.
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File A Dispute Directly With The Creditor
You can also contact the company that provided the information to the bureau in the first place, such as a bank or credit card issuer. Once it receives a dispute, a lender is also required to investigate and respond to all disputes that might impact your score.
Remember to include as much documentation as possible to support your claim. It’s also helpful to include a copy of your report marking the error.
The address you should mail the letter to is usually listed on your report, under the negative item you’d like to dispute. You can also contact the lender directly to verify the mailing address and the documents you should include.
If the lender finds that it was mistaken or cannot prove that the debt actually belongs to you, it will notify the bureau and ask it to update your file.
Write A Goodwill Letter
If disputing the negative entry doesnt work because you couldnt find errors, or because the credit bureaus fixed them, your next step should be asking for a goodwill adjustment.
Write a letter to the original creditor or collection agency and ask them to remove the negative entry from your credit history as an act of goodwill.
This is most effective when youre trying to remove late payments, paid collections, or paid charge offs.
A goodwill letter is really easy to write. You can use my goodwill letter template as a starting point.
You will basically explain your situation to the creditor or collection agency. Explain how youre trying to get a mortgage and the negative entry means youre struggling to get approved.
While this may seem like a long shot, youd be surprised how often creditors make goodwill adjustments. This is especially true if youre a current customer because the creditor wants to keep your business.
This strategy wont work as well if you have a long history of keeping past due balances. It works best if your negative entry is an anomaly and if youve paid off the balance due.
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How To Help Your Credit Utilization
- Pay your balance this will have a positive impact immediately on credit report
- Divert a minor amount every month If you have no plans to add new debt somewhere, start saving
- Ask the credit card company to increase your credit line
Do not touch the added credit line. Instead, use this percentage increase to drop your utilized credit. Lets use the same example as discussed above. If you have a $100,000 credit limit increased to $150,000, a $30,000 balance automatically equates to 20% credit utilization. Thus, the credit score certainly recovers in this situation.
File A Dispute With The Credit Reporting Agency
Once you have your report, make sure to look through each account and see if there are creditors you dont recognize. Its also important to check whether older derogatory items are still being reported.
If you do find errors in your reports, its time to initiate a dispute directly with the reporting bureau through its website or by mail. This will prompt an investigation on the bureau’s part.
Bear in mind that you have to dispute the entry with each agency to make sure the removal is complete across the board.
How to file a dispute online
Each bureau Equifax, Experian and TransUnion has a section dedicated to walking consumers through the online dispute process. Once you create an account, you can file as many disputes as you need and check their status, for free.
How to file a dispute letter
You can also send a dispute letter to the bureaus, detailing any inaccuracies you’ve found in your credit file. When writing your letter, provide documentation that supports your claim and be precise about the information you are challenging. The Consumer Financial Protection Bureau recommends enclosing a copy of your report with the error circled or highlighted.
Depending on the information being disputed, these are some of the documents you can provide to help aid the investigation:
- Copies of checks
Include this dispute form with your letter.
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Have A Credit Repair Professional Remove The Negative Items
If youd rather not send dispute letters, goodwill letters, or negotiate pay-for-delete agreements, you could always hire a credit repair service to do this work on your behalf.
I suggest you check out Lexington Law, one of the nations leading credit repair companies.
Lexington Laws experts deal with credit reporting agencies every day. They know the Fair Credit Reporting Act inside and out.
They can usually remove inaccurate information a lot faster than you could by yourself. Professional credit repair projects tend to take two to three months.
You may spend $400 to $500. This would be money well spent if it restored your good standing with lenders in time to secure a loan with low-interest rates.
Can Paying Off Collections Raise My Credit Score Or Remove It From My Credit Report
Paying off a collections account alone typically does not raise your score and does not automatically remove it from your credit report. In fact, paying off a collection account doesnt normally change how fast it comes off your credit report.
A paid collections account will typically stay on your credit report for seven years from the date the account was first reported past due. As long as it remains on your report, it will have a negative impact on your score. The severity of its impact lessens over time until it finally falls off after about seven years.
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How Do I Remove Negative Items From My Credit Report
To recap the material already presented, you have several ways to legally remove negative credit report items:
- Dispute erroneous items on your credit reports by doing the work yourself.
- Hire a credit repair service to dispute inaccurate items on your behalf.
- Send a goodwill request.
- Send a pay for removal request.
- Wait for items to age off your reports.
The last item, waiting for bad items to age away, is the easiest method, as you dont have to lift a finger for it to work. The downside is that it may take several years to bear fruit.
You can initiate credit repair yourself without the expense, although youll have to devote some time to the process. Alternatively, you can pay credit repair companies to do the job for you.
are better positioned, have superior knowledge, and can usually complete the job for under $1,000, sometimes considerably less.
Can You Remove Negative Entries In Your Credit Report Before Seven Years
If youre wondering how to remove negative items from a credit report before seven years, you can follow the steps provided above but take note that this will only be possible if the negative entries have incorrect or unverifiable information. You cannot just have entries removed just because they are negative. The three credit bureaus or information providers will have to check whether the complaint you file is valid.
For instance, if you want an unpaid collection removed from your credit report, you can only win the dispute if you are able to prove that the entry is incomplete, outdated, or unverifiable. Otherwise, the credit bureau will retain the entry if it is able to verify from the information provider that the entry is accurate.
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Pay For A Credit Monitoring Service
TransUnion, one of the major credit bureaus, offers a that requires a fee. I have used this service myself.
You can find a lot of other fee-based credit monitoring systems out there.
So why would you pay for credit monitoring when you can get it free?
Paid services have more elaborate tools, but they also have ways to help you recover from identity theft rather than simply detect it.
Can You Remove Incorrectly Reported Negative Items From Your Credit Report
Many people are not aware that it is possible to dispute entries in so they just accept whatever is there without questioning if there are credit report errors or not. If you are wondering whether you could dispute entries in your credit report, the answer is YES.
There is a federal law that gives you the right to dispute incomplete or inaccurate information in your credit reports. This law is called the Fair Credit Reporting Act or FCRA which was passed in 1970. The FCRA regulates the collection and access to consumers credit reports to ensure that the personal data included in the credit reports are accurate, fair, and private.
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Checking Your Credit Report
Now that youre aware of what can happen if theres than an inaccuracy on your credit report, lets talk about what kinds of common errors you may see on it:
- Inaccurate Personal Details Simple mistakes such as the wrong name, birthdate, or mailing address can spell disaster because you could end up with someone elses credit information .
- Wrong Account Information Its also possible that your lender didnt report your payment or account activity correctly. For instance, if you paid your debt on time but it was accidentally labeled as late or defaulted.
- Falsified or Stolen Accounts Identity theft and fraud are two of the worst things that can happen to your finances and credit report, not to mention complicated and time consuming to deal with afterward.
- Uncorrected Negative Information Missed payments and other negative credit actions stay on your report for several years . If so, a bureau may forget to remove the information after the allotted time period.
Review The Claim Results
Reporting agencies and lenders usually take around 30 days to investigate disputes. Once they make a decision, they must notify you within five days of completing their review. The notice will inform you if the disputed item was found to be inaccurate or not.
If the disputed information was, in fact, inaccurate, the bureau must update or delete the item. They should include a free copy of your file if the dispute results in a change.
If the bureau or lender considers the disputed information isn’t a mistake, you can file an additional claim. Review your initial claim for any errors and correct those. If possible, you should include additional documents to support your request as this can help the bureau evaluate any data it might have missed the first time around.
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How To Request Pay For Delete
To ask for pay for delete, youll need to send a written letter to the creditor or debt collection agency. A pay for delete letter should include:
- Your name and address
- The creditors or collection agencys name and address
- The name and account number youre referencing
- A written statement saying how much you agree to pay and what you expect in return with regard to the creditor removing negative information
Youre essentially asking the creditor to take back any negative remarks that it may have added to your credit file in connection with late or missed payments or a collection account. By paying some or all of the outstanding balance, youre hoping that the creditor will show goodwill and remove negative information from your credit report for that account.
How To Remove Credit Report Errors
Your first step will be to get copies of your credit reports from all three bureausEquifax, Experian and TransUnionand go over them carefully.
You can get your reports for free at AnnualCreditReport.com. Look for accounts you dont recognize. As you check your credit reports, you may be surprised by how many accounts there are. Because your report lists negative information for seven years and positive information for much longer, you will probably see accounts, referred to as trade lines, that youve forgotten about, and perhaps even some that you didnt realize you still had.
Verify account numbers, balances and dates opened and closed. If you find errors, you will need to document them carefully and communicatein writingthose errors to the bureaus. Since the credit bureaus dont always have exactly the same information about you in their credit reports, if you see an inaccuracy on one credit report, follow the dispute process and have it corrected.
But you may not be out of the woods. The other bureaus may have different inaccurate information. That is why you need to get all three reports to make sure all your information is accurate.
If the same error appears on two or all three reports, you need to dispute it only once. If the source of the information makes a change as a result of your dispute, that source has to tell the other bureaus about the change, too. But I recommend double-checking anyway.
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Review Credit Report And Check For Inaccuracies
Inaccuracies happen often and guess what? If a tradeline on your credit report is inaccurate, the credit bureau must remove it.
Its that simple.
Okay, maybe its not as easy as that, but its worth the effort if your credit report has errors. When I say errors, I mean anything. Sure, you paid your credit card three months late last year that is accurate but look at the details.
Did the credit bureau or creditor report the dates wrong? Is the amount incorrect? Maybe there are transposed numbers in the account number. Any mistake you find, dispute it.
- Order your credit report. Everyone gets free access to their . Usually, you get one from each credit bureau annually. Due to COVID, everyone has free weekly access through April 2021.
- Go through each tradeline and look for even the smallest errors.
- File a dispute online with the credit bureau and/or send a written letter in the mail.
- Include any proof you have of the error for faster processing.
The credit bureaus have 30 days to respond and verify the information. The Fair Credit Reporting Act gives credit bureaus 30 days to verify the information. If they cant, by law, they must remove it from your credit report.