Negative information like outstanding debts, foreclosures, and bankruptcies stay on your credit report for seven to 10 years and can pull down your credit score. However, under the Fair Credit Reporting Act, you have the right to dispute inaccurate or outdated items on your credit report and have them removed.
Removing inaccurate or old information from your credit report will improve not only your credit but also the likelihood of getting a home loan.
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Steps to dispute inaccurate information on credit reports
1. Get a free copy of your credit report
Each of the three major credit bureaus — Experian, Equifax, and TransUnion — will give you one free credit report every 12 months. You can get all three from the federally authorized Annual Credit Report.com, or you can apply individually:
As you’re examining your credit reports, look for these errors:
- Mistaken identity or inaccurate personal information
- Inaccurate balances or credit limits
- Accounts you don’t recognize
- Wrongful reporting, such as on-time payments reported as late or unpaid or the same debt reported twice
2. File a dispute
In your letter, you’ll need to include your personal information (name, address, and telephone number) and the account number on your credit report. Be sure you match the account number with the right credit bureau, as each will be different.
You’ll also need to identify each mistake and provide clear reasons why you think it’s inaccurate. If possible, attach documents that support your claim.
Contact your credit bureau
You can dispute your credit report online or send a letter to each credit bureau.
Contact your financial institutions
Credit bureaus only report information they’ve received from financial institutions or data furnishers, like banks, credit card companies, and lenders. If you want to get to the root of the problem, you could contact these institutions directly and ask them to fix their mistakes.
3. Wait until the investigation is over
It usually takes credit bureaus 30 to 45 days after you file your dispute to finish an investigation. Credit bureaus could take the inaccurate information off your credit report, ask you for more documents supporting your claim, or conclude that the information was accurate.
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4. Ask for negative information to be forgiven
If the information on your credit report is accurate, one strategy to remove it before the 7–10 year period is to write a letter.
A goodwill letter is a formal request asking lenders to remove a closed account from your credit report. In this letter, you admit to making a mistake and ask your lender to forgive it without penalty.
There’s no guarantee that a goodwill letter will work. But you’ll have a higher likelihood of success if you’re in good standing with your lender — meaning, you’ve paid down your overall debts substantially and on time.
Letter of explanation
A letter of explanation allows you to explain to your mortgage lender why you missed the payment (such as if there was an unexpected job loss or another extenuating circumstance), as well as to emphasize that past poor habits won’t be repeated in the future.
- Negative information stays on your credit report for 7–10 years.
- You can dispute inaccurate information on your credit report by sending a letter to credit bureaus or your financial institutions.
- If you have negative information that’s also accurate, you could ask lenders to remove it with a goodwill letter.