Credit Repair – How to Identify and Dispute Errors on Your Credit Report
A credit report contains information about your debt and financial history that’s used by mortgage, auto, and personal lenders to decide whether to give you a loan or credit card. It’s important to understand your credit report and how it affects your credit score so you can take action to repair it if necessary.
Credit repair involves identifying and disputing negative items on your credit report that can negatively impact your score. These items can include late payments, charge-offs, collections accounts, tax liens, and court judgments.
Typically, credit repair companies will challenge these items by working with the original credit issuer or current account owner to remove the item from your report. These types of disputes can take time, so you may want to work with a professional who can provide more expedited service.
The Credit Repair Organizations Act (CROA) requires that credit repair companies provide a disclosure before they start work on your credit reports, which includes information about your rights to dispute errors yourself. They also must provide a physical address and let you know how to cancel the services they offer before the contract is signed.
These agencies often ask you to pay them upfront, so it’s important to check out their reputation before signing on the dotted line. They should also clearly state how much you’ll pay, the services they’ll provide, and their legal rights.
Scammers are often involved in the credit repair industry and can make bogus claims about getting you a new identity or removing inaccurate information from your credit file. They may also promise a fast fix by using a new Employer Identification Number or Credit Profile Number.
Credit repair is a complex and time-consuming process, so it’s important to do your homework before you hire someone else to help you clean up your credit. The best credit repair agencies will provide you with a comprehensive, step-by-step plan to improve your credit.
You can also do some of the work yourself, as long as you know how to do so. You can request your credit reports from each of the three major credit reporting bureaus, review them for inaccuracies, and dispute any erroneous information.
When disputing negative marks on your credit report, you must follow the process outlined by each credit reporting agency. They will investigate the item you’re disputing and notify you of their findings within 30 days. If they find that the mark is accurate, it should be deleted from your report.
If a creditor or debt collector refuses to remove the item from your report, you can always reach out to them for a goodwill deletion. This can be done by writing them and asking that the item be removed.
In addition to disputing negative marks, credit repair companies can also help you establish a positive credit history. This will allow you to start rebuilding your credit and boost your score over time.
The key is to make on-time payments and keep debt levels low. This can lead to a boost in your credit score and help you qualify for better rates on loans, including home and auto.
