Having bad credit can harm you.
But even worse is having bad credit that you didn’t earn.
This can happen to you whether you have good or bad credit.
Sometimes a bank will make an error. Sometimes they may report it incorrectly on purpose.
Whatever the reason, here are some tips that may help you improve your credit score.
First, check your credit report.
There are three major reporting agencies, and you can get a free credit report once a year from each of them.
This is the most important step, because without knowing what’s on your credit report, you will not know whether it is correct and up-to-date.
Scan all three and pay close attention to the section that contains negative information.
Second, make sure that each item is listed correctly.
Each of the three reporting agencies offer ways to check, and even submit a dispute online.
Some books may tell you to dispute things that you know are your accounts, but may be listed differently.
This is not only not fair, but it is fraud. If it is truly your debt, but not your address, own up to your responsibility and do not file a dispute.
However do get the incorrect address removed, because in the case of an incorrect address, it may make it look like you move quite a bit, and this could be a deciding factor for some loans or jobs.
Third, do not hesitate to dispute items that are honestly incorrect.
I once had a charge of over $10,000 listed as past due on my account.
The account was not past due, and I was able to clear up the misunderstanding, but not before I was turned down for a loan because I hadn’t checked my credit report before I applied for the loan. I still managed to get a loan from Elc Loans – they do not check credit when approving applications.
As with the $10,000 mistake, some may not be reporting as they should. File a dispute and let the process take its course.
Do not file more than one dispute at a time, because they may think that you are trying to cheat the system and they will dismiss them all as being frivolous.
Once the company reporting the loan gets the dispute, they may change it, remove it, or leave it alone.
If they do not change it, then it is time for more intense action, and you should proceed to step four.
Fourth, send “nasty grams”.
A family member who declared bankruptcy once had a company try and keep it listed as a charge-off, even though it had been listed in the bankruptcy proceedings.
This bank had been bought out by another bank, and they listed the amount that she owed when they declared bankruptcy.
She tried everything she could think of on her own to have it removed, and they continued to tell the reporting agency that it was being reported accurately.
She contacted an attorney who told her to send a “nasty gram”.
This is what the attorney called it when she took steps that would ensure the bank would remove it.
First, document that you never had an account with the bank who is reporting. They changed after the bankruptcy, and therefore my relative never accepted their terms of service.
Furthermore, under US bankruptcy law (at the time), any amount included in the bankruptcy must be listed as owing $0.
Although the law does not say that it must be reported as a bankruptcy rather than a charge-off, the bank had continued to list the amount at what she owed when she declared bankruptcy.
Obviously, this is a violation of bankruptcy law, and they can be fined and owe my relative some cash.
She threatened to sue them unless the entire history of that account was removed.
Because the bank saw that they were in serious trouble, they said that the account was her husband’s, so it was being removed from her credit report (it was a joint account).
When they listed it in the husband’s credit report, they listed it the same way, with the amount included as a charge-off.
He took all the same steps and ultimately they removed it completely. Obviously, the credit card company wanted to punish them for declaring bankruptcy by continuing to report it incorrectly.
They were betting that the couple did not know their rights. But with the help of an attorney, they were able to have the item completely removed, rather than just being reported correctly.
The credit card company’s gamble did not pay off in this case.
If you still cannot get negative items removed from your credit report, consider speaking with an attorney.
They may be able to help you with solutions that are more difficult to maneuver.
Whatever the case, there is no reason to settle for having negative items which are inaccurate and don’t belong there.