Your financial information is provided to the credit bureaus by various sources. Banks, lenders and credit card companies share your account numbers, balances, credit limits, payments and other data with Equifax, Experian and TransUnion. They provide positive and negative reports. Sometimes they make errors, and federal laws lets you request removal of these harmful mistakes.
Step 1
Request your current credit records from all three credit bureaus. The Federal Trade Commission, FTC, explains they must give you free copies annually if you use the order form or phone number on the Annual Credit Report website.
Step 2
Review the accuracy of all negative reports on your credit records. The Fair Credit Reporting Act, FCRA, only lets you remove items with mistakes in them. Your chance of finding an error is good, as Dayana Yochim, a columnist for the Motel Fool financial website, states up to 80 percent of credit records contain incorrect reports. The mistake can be anything from an old or misspelled creditor name to transposed numbers or incorrect balances and dates.
Step 3
Write letters to the three bureaus asking for removal of every negative report that contains any type of mistake. Describe the errors and state you want your records investigated within 30 days. The FCRA gives you this right, the FTC advises. The bank or lender reporting each item must provide proof within that period or it will be removed.
Step 4
Visit the post office to mail your letter certified and get a dated receipt. The FTC explains you can challenge credit reports online but letters are more effective because you can get proof of sending them and the exact date. This marks the beginning of the FCRA-mandated 30-day period.
Step 5
Review each credit bureau reply and check a new copy of your credit records to make sure negative errors have been totally erased. The bureaus have to provide their investigation results and let you know if some items were verified. All other reports should be gone.
Tips and Warnings
- Set up a regular review schedule for your credit records. MSN Money explains you can order a record from one bureau every four months instead of getting all three at once. This lets you catch and remove erroneous negative reports more quickly.
- Do not challenge negative reports for non-existent reasons. The FCRA lets credit bureaus ignore dispute letters full of frivolous claims. They may also be suspicious of valid claims in the same letter and refuse to conduct an investigation.
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