Financial Freedom

A lot of companies out there tout the claim that they can “fix your credit report legally” these days. But what does that actually mean? What does it mean to say they can “fix” your credit report “legally”. The phrase almost sounds like it has a a shady connotation to it, doesn’t it? If you pay them money, they promise to improve your credit score and to “clean up” or “repair” your credit report. Should you take them seriously? Well I’ve got some good news and some good news for you. The truth of the matter is, yes, it is legally possible to improve your credit score and to have negative items removed from your credit report. The other good news is that I will tell you how you can do this by yourself, for free, so that you don’t have to go pay some law firm or some credit counseling company money to do this for you.

It is really very simple, actually. There is no secret, hidden legal process. There is no shady “hacking into the credit files and doctoring them”. There is no creation of a new credit report. All of these methods are illegal by the way.)

All you have to do is take advantage of a well-known law that I’m sure most consumers have heard of. But most consumers have no idea what this well-known law really states. It’s called the Fair Credit Reporting Act.

By law, if a consumer sees something suspect on his or her credit report, he or she has the right to dispute it with the credit reporting agency. The credit reporting agency, by law, has thirty days to investigate the dispute and verify the accuracy of the negative entry on your credit report about which you are disputing. If the agency does not receive a response verifying the disputed item from the creditor within thirty days, then the credit reporting agency, by law is required to delete that negative item from your credit report!

This is a very simple process that every American consumer has a right to engage in. Yet it requires putting in some time and effort, and requires some patience. But if you are persistent at it, you can have a much improved credit score in a matter of a few months. Of course, the creditor could reply back and state that the item has been verified as accurate, in which case the item will remain on your credit report. But sometimes this process can work in your favor. If you have a collection item from a collection agency that has been bought and sold many times over to some other collection agency, it can be a mess to try to track down who actually holds your debt. That alone can take over thirty days. Or the creditor can no longer find your account in their system because your account was closed several years ago. That response alone will cause your disputed item to drop from your credit report. Or the creditor’s contact information is no longer up-to-date and they can no longer be contacted.

Or perhaps the company has gone out of business. So how do you dispute a negative credit item? Simple: Write a letter to the credit reporting agency that has listed the disputed item on your credit report, telling them that you dispute the accuracy of the information contained therein. List the creditor, your name, social security number, and a description of which items are in dispute. For example, if you were ninety days late on a payment to ABC Company in July of 2004, write in your letter that you dispute that specific late payment because you believe it to be inaccurate. You do not need to tell them a more detailed reason why, nor do you need to tell them what you really think it should have said. But you should state in your letter that you are writing to them in accordance with the Fair Credit Reporting Act, and that you expect that they will delete this disputed item within thirty days if it goes unverified by the.

So there you have it! That is how you repair your credit. Be sure to write a separate letter for each disputed item to each of the credit reporting agencies. So if you have ten negative items that you are disputing, and all ten of these show up on the three major credit reporting agencies, then you would have to write thirty separate letters.

How quickly will you see results on your credit report and see an improvement in your credit score? You should give it at least two months. With the time it takes to mail correspondence to the agencies and for them to mail it back to you, plus the thirty days in between, that alone can take five to six weeks. And then, the item to be deleted may not be deleted until the following month, since credit reports are updated monthly.

One more thing: The Fair Credit Reporting Act also gives the credit reporting agencies the right to disregard frivolous disputes. In other words, if you are mailing them dispute notices just for the sake of trying to force the thirty-day rule, they have the right to not take your dispute seriously. But of course, the agencies cannot assume that you are doing so, unless they see you trying to dispute the same negative items on your credit report repeatedly over and over again to see if it will be deleted this time! Keep in mind, though, that the intent behind this law is to protect consumers against errors in their credit report.