Many consumers feel powerless when it comes to the information on their credit reports. They don't realize the Fair Credit Reporting Act gives them the power to improve their reports in several ways. It doesn't cost anything to improve your credit report in legitimate ways. You simply have to review the information and know what you should dispute and how to do it. You can often make significant improvements to your reports by doing this regularly.
Step 1
Ask the credit bureaus to remove errors that hurt your credit score. Experian, Equifax and TransUnion are the three major bureaus. They must investigate any mistakes you dispute and remove the information if your complaint is valid, according to the Federal Trade Commission. You can significantly improve your reports by disputing any type of error on a negative item, Creditinfocenter.com advises. Challenge wrong dates, balances, account numbers, credit limits, creditor names or anything else you notice.
Step 2
Ask the credit bureaus to correct mistakes in your demographic and employment information. Lenders will compare information on your credit application to what the credit bureaus list. Loan or credit card approval could be delayed if your employer's name is wrong or you are only listed as living at your current address for one year when it should be 11.
Step 3
Dispute old information that should have been removed from your credit reports. Debthelp.com explains most negative items like late payments, collection accounts, suits and charge-offs, much be removed from your credit history after seven years. Bankruptcies must come off in either seven or 10 years, depending on the type of case you filed. Most arrests can remain also remain on your report for 10 years, according to Debthelp.com. The credit bureaus may not remove this information when they are supposed to do so. You will improve your reports by making sure it is removed in a timely manner.
Step 4
Ask creditors with whom you are in good standing to report your accounts to the credit bureau if they are not doing so already. Most loan and credit card companies automatically report your payment history and other information to TransUnion, Equifax and Experian. Sometimes an account will not show up on your reports. Ask the creditor to ensure that it is reporting your information properly.
Tips and Warnings
- The Fair Credit Reporting Act has an amendment that lets you order free credit reports from the three credit bureaus every year. The government maintains the annualcreditreport.com website, which lets you order them online, through a mail application or over the phone. Use this source for your credit reports; otherwise, you will pay an upfront fee or be required to sign up for a membership or trial service.
- Don't stop monitoring your credit once you have improved your reports. They are constantly changing based on information reported by your creditors and changes to your accounts. You may have cleaned up all the errors, but another mistake can crop up the very next month if a bank reports wrong details or the credit bureau mixes you up with someone who has a similar name. Get one free credit report every four months to cover yourself throughout each year.
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