Latest posts by Kumiko Ehrmantraut (see all)
- How to Deal with Debt in Collections - April 14, 2021
Credit scores do matter. The higher the number (850 is perfect), the better.
When was the last time that you found yourself applying for a loan? It's wild to think that your approval for a loan, the APR that you will pay for the duration of the loan, and the length of the loan can be based solely on your credit score.
Your credit score may be just a number, but it's a number that affects many financial aspects of your life.
Have there been times in your life when you missed a due date for a bill? There's a good chance that that missed payment got reported to the credit bureaus and turned over to collections. This is not a good thing!
Think of your credit report as a report card for your financial past. Removing negative information from your credit report is challenging, but not impossible.
If you are looking for ways to better your credit, here are a few strategies to get negative information removed from your credit report.
CHECK YOUR CREDIT REPORT FIRST
There are free resources like Credit Karma out there where you can view and keep track of your credit every month. It's smart to check monthly to make sure that there aren't any surprises on your report!
Accidents do happen, and sometimes derogatory remarks can show up as a result of human error. Call those errors out and get them fixed. Don't ever leave negative information on your credit report if possible!
You are entitled to receive your credit report for free every 12 months from all three major credit bureaus. Take advantage of this!
So, what are some of the things you should look for?
It's not uncommon for accounts that don't belong to you to show up on your report. It has happened to me in the past. Make sure that all of the accounts listed on your credit reports are actually yours.
Look at the actual details of the accounts listed. Are there any open accounts that are reported as closed? Are there inaccurate account balances?
MAKE A PHONE CALL
If you pull your credit report and there are wrong or negative marks, don't panic. The next best thing to do is contact the credit bureau that is showing the negative mark and find out why it's showing on your report.
Have a conversation with them about the negative mark and simply ASK THEM what you can do to get the negative mark removed.
Yes, start by just asking. While the credit bureau is not obligated to do anything for you, they have the option to help.
Just by asking, you may find that they are willing to work with you, especially if this is the first time your report shows a negative mark.
By asking what you can do to get it removed off your credit report, it gives them options to consider. There have been examples of negative marks getting removed merely by signing up for automatic payments for the debt owed every month. Not only does it guarantee that they get the outstanding money, but it also is a guarantee that the mark would be removed once paid in full.
SUBMIT A DISPUTE TO THE CREDIT BUREAU
Due to the Fair Credit Reporting Act, you have the right to an accurate credit report, and because of this right, you can dispute errors with the credit bureau.
The FCRA also defines what type of information that can be listed on your credit report and for how long (usually seven years). If you notice information that has been listed on your report for more than seven years, you need to look into having it removed.
There are two ways you can dispute information on your credit report with any of the three credit bureaus – online or with a written letter.
Keep in mind; you must have recently ordered a copy of your credit report to submit a claim. Since you can receive a credit report from all three credit bureaus, make sure you file a dispute with the credit bureau who provided the report. Here are links to all three credit bureaus to file a claim online:
If you decide to write a letter instead, make sure to describe the report and error in detail and submit any proof that you might have. Keep copies of everything that you send them for future reference. If you are sending any proof documents, make copies to send to them and keep the originals for your records.
All credit bureaus typically have 30 days to investigate your dispute and respond to you. This is the only reason I suggest sending anything in the mail by certified mail. Not only will you have proof of the date that you sent your dispute, but it will also help you keep track of the time that the credit bureau receives your written dispute.
CREATE A DISPUTE DIRECTLY WITH THE LENDER
You can bypass the credit bureaus all together and make a dispute directly with the business that reported the error or negative mark to the credit bureaus. This can be a credit card issuer, a bank, or debt collector.
The lender is required to do an investigation just like the credit bureaus. If they determine that an error was indeed reported on their behalf, they must notify all the credit bureaus so that the information can be corrected.
What happens if the information is accurate, but it's a negative mark that you just want to have removed?
You can make two requests to have accurate, but negative marks removed from your credit report.
A Pay for Delete Offer is a strategy you can use with delinquent or past due accounts. You offer to pay the account in full in exchange for having the negative marks removed from your credit report. It never hurts to ask. So if you are dealing with negative marks due to late payments or past due accounts, give the lender a call and see if they will accept this offer.
If you have already paid the delinquent account, a Pay for Delete Offer is useless because you no longer have the negotiating power. The next step is what I like to call a “Letter of Mercy.” A Goodwill Request can be sent to the lender explaining why you were late, and what you have done to make sure you are a good paying customer. Ask the lender to present the account reported more favorably.
Remember, they don't have to comply. Some will and some won't. But if you end up talking to the right person, some creditors will make these deletions for you. It never hurts to ask.
CONCLUSION
Negative marks on your credit report can genuinely be a bummer. It's essential to make sure that you are paying your bills on time.
While it may not seem relevant to you now, there will be a time in your life when your credit report will matter, and the score that populates will either help you or hurt you in the buying process.
Negative marks on your credit report mean higher APR's, and it can be harder to obtain loans for items that you may be needing in your life.
Take time out of your busy schedule to make sure that you are checking your credit reports often. If you notice a change, look into it.
Take pride in your credit report and make sure it's the best it can be. Trust me; the work pays off!
When was the last time you checked your credit report? Let me know about your experience in the comments below!
If transfer my credit card debt to low percent card would I be able to use my previous credit cards
Hello Samlee. Yes, unless you close those credit card accounts permanently, you will still have access to use them. However, if you are switching to a lower interest rate card to pay off debt quicker, I highly suggest not using the old cards. It will make it a lot more difficult to pay off your debt if you are still using them. I hope this helps!