Work on Your Financial Fitness: Tackling Errors and Negative Information in Your Credit Report

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You decided to work on your financial fitness and checked your credit report. What do you do if you discover errors,  or you need to deal with negative entries in your report?

First, take a moment to read Improve Your Credit Score in 7 Steps.  Pay special attention to Steps 5, 6 and 7. Those steps refer to specific actions to take regarding your credit report.

Dispute all errors in your credit report. It is important to tackle all errors immediately. It is prudent to dispute errors in writing, even if you begin the process online.

Upon receiving your dispute request, the credit agency that issued the report will open an investigation regarding the item you’re disputing. The agency will contact the creditor in question to verify the information they submitted regarding your account. If the creditor cannot verify the disputed item, it must be removed from your credit report and the credit agency must send you, for free, a corrected credit report. Now, if the investigation reveals that the information the creditor submitted is truly an error, your credit report need to be corrected and you may request the credit agency send a copy of your corrected report to everyone who received a copy of it within the last six months.

If the credit agency’s investigation concludes the creditor’s information is accurate, you are entitled to receive from the agency, in writing, the name, address, and phone number of the person who made the report. Be persistent in requesting the information you are entitled to, if the credit agency tries to skip past this requirement. You can initiate a second investigation if you still disagree with the disputed information in your credit report. If the outcome is not to your satisfaction, after a second investigation, you can request the credit agency allow a 100 character explanation of your side of the issue be inserted into your credit report next to the disputed information.

Negative entries remain on your credit report for 7 to 10 years. Bankruptcy information remains in your report for up to 10 years. If you have been a good customer, but have a few late payments noted in your credit report, your lender may be willing to erase one or two of them when asked. Sometimes creditors will even delete past due references early, before the 7 year mark, if you make the effort to bring the account balance to current status or pay it off entirely. If there are negative items in your credit report that are over 7 years old, and not connected to a bankruptcy, they need to be aged out of the report.

If you have past due accounts, take the time to speak to your creditors. They may be willing to work with you to get your accounts current. Once you come to a payment schedule agreement with your creditor, make sure to pay your accounts on time. This demonstrates your committment to being financially responsible. If you decide to seek help from a credit counseling or repair organization, learn what help these organizations can legally offer you and read up on what scams are out there which may look like credit repair offers. If a credit score is being offered for free by a website or company, read the fine print. Often, the company is actually offering credit monitoring services, with a “free” trial that turns into a monthly charge if not cancelled before the end of the “free” trial period.

Your credit is a valuable asset . It is definitely worth the time and effort to make sure your credit report is accurate. Taking steps to improve your credit may be difficult in your current life situation, but worth every effort you put forth. Make your credit stronger through timely payments and account management. Financial fitness may reduce stress and help a transaction be smoother, when going forward with a large purchase, like a home.

Photo Courtesy of Salvatore Vuono / FreeDigitalPhotos.net

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