Having a fair or low credit score can cause quite a negative impact on your finances. A low score might cause you to lose out on a job, get denied for a car loan, and cause you a great deal of stress. You may think there is not much you can do to change your credit score or what is listed on your credit report; however, credit repair is possible, and there are quite a few actions you can take to gain control of your credit and fight errors that may be causing it damage.
Order New Reports
One of the first steps to take when you want to repair your credit is to order reports from the three major reporting companies: Experian, Equifax, and TransUnion. Each company is required to offer you one free report every twelve months, so you might want to make these checks an annual habit. Obtaining a fresh report from each company allows you to compare them so that you might find errors more easily. It also might give you a more complete view of what companies are reporting, how often, and whether those reports are accurate.
Understand What Constitutes an Error
Before you can fight errors on your credit report, you need to understand what counts as an error and which discrepancies are the responsibility of the reporting company. Generally, there are three common types of errors: items that are not your debt, those that were reported inaccurately, and those you do not recognize or that look fraudulent. If you should find any of these items, you should contact the reporting company right away.
You may think that fighting these big credit reporting companies is next to impossible, but you do have the law on your side. The Fair Debt Collection Practices Act requires that each reporting company is required to remove items that are not the responsibility of the individual in question, and if the company refuses, you are within your rights to hire an attorney. In most cases, simply mentioning the Fair Debt Collection Practices Act is enough to prompt a removal.
Removing false or inaccurate information on your credit report is possible, but you should keep in mind that you will need to be proactive in your efforts to accomplish it. The reporting companies are not going to change or remove any debts unless you are persistent and offer concrete evidence that a report is incorrect.
For example, if you discover a report from a furniture store that notes you failed to make payments on one or more items, contact the retailer and ask for debt validation. If they fail to produce proof that you opened a line of credit at their store, you should give this information to the reporting agency. Working directly with the credit bureaus and being firm yet calm about removing false information can pay off in the long run.
Seek Professional Credit Repair Assistance
If you suspect your credit report has multiple issues, you may want to consider reaching out for help from a credit repair service. Not only can this help you fix credit score issues, it may also give you the confidence you need to take the first steps toward repairing your credit. Facing creditors and collecting the information you need from them can be daunting, and credit repair companies specialize in representing consumers so they feel less overwhelmed.
When you first contact a credit repair agency, they will most likely obtain copies of your credit report for you, and then note where you believe any discrepancies lie before they begin to contact your creditors or companies that have wrongfully reported you. These agencies may also be able to help you learn a few strategies for improving your credit score overall.
Some credit reporting agencies may advise that you file a dispute using their online form. While this can be convenient, it may not allow you to be as detailed as you need to. In most cases, the virtual forms have limited space and do not allow you to attach files, such as letters explaining the dispute or any documentation you may have.
Instead of filing online or over the phone, it is a better idea to write the credit bureaus a detailed letter about any dispute you have. Be sure to make copies of your letter and your documentation in case you need them at a later date. The more detailed you make your dispute, the better the evidence you have should the dispute go to court.
Understand Credit Reporting Laws
Knowing and understanding your rights can go a long way in having errors removed from your credit report. For example, under credit and debt laws, negative information should vanish from your report after seven years, and any large charge offs or bankruptcies cannot remain after ten years. Being aware of such time restraints can help you peruse your report with better understanding.
If you should receive a call or a letter from a debt collector about a debt that is currently under dispute and the collector tries to pressure you into agreeing to pay even a part of the amount, knowing your rights can help you stop these harassing calls. Let the collector know that the charge is under dispute and that you are under no obligation to pay any of it. The more you understand credit reporting laws, the better you can protect yourself from harassment.
Remain in the Know
Once errors are removed from your credit report, you may believe you do not have to monitor it any further. However, checking your report at least once a year can help you stay informed about whether any new information reported is accurate. Identity theft, false or inaccurate data, or accounts opened in your name without your knowledge can all cause your credit score to take another dip. Take advantage of a free annual report and be vigilant about protecting your credit.
It is possible to repair your credit and improve your credit score. While it might seem like a challenge, knowing your rights, working with a credit repair company, and being persistent about having errors removed can put you on the right path to a solid financial future.