Your credit report is not a matter of destiny carved in stone. It is a complete myth that once you have bad credit you will always have bad credit and all the attendant consequence — high interest rates and no chance of getting a loan for anything ever again. It’s also a common misconception that seven to ten years must pass before a negative item disappears from your credit report. You can take control of your credit reputation once you understand how to remove bad credit from credit reports — and it just takes a matter of weeks. There’s nothing difficult about the process; so prepare to get proactive with your own financial status.
First, understand that by law in the United States you are entitled to one free copy of your credit report per year per credit bureau (Equifax, Experian, TransUnion.) The fastest way to get started is just to go over to AnnualCreditReport.com. When you are turned down for credit:
- get copies of your credit report.
- have the company that turned you down tell you why specifically.
- get to work on your own.
Go over everything on your reports and find the “bad” items. Steel yourself. It’s time to get in there and dispute the problems. This is not a process for the bashful or the faint of heart. You have to stand up for yourself to get bad items removed from your report. That means calling the bureau, talking to someone about your report, and negotiating. It also means taking the initiative to round up any necessary paper work to validate your claims.
Understand from the beginning that there are things the credit bureaus don’t share with you that put a great deal of power in your hands, including:
- The credit bureau has to be able to prove every item on your report or the item must be removed. If they can’t verify the item, they must expunge it.
Essentially what happens is that the bureau gets in touch with the source reporting the bad item. If they don’t get confirmation back in 14 days, they have to remove the information from your credit report.
- Computer operator mistakes can and do happen. Something as simple as a loan that has been paid showing up on the report as outstanding can effect your credit. If it doesn’t look right to you, pursue the matter vigorously. Give the company the exact nature of the error and tell them how it should be listed. Back up your position with faxed photocopies. For instance. “Loan 334455 was paid in full on 11/11/08. See attached photocopies for confirmation.” (Keep copies of all your correspondence with the credit bureau.)
- Never forget that time is on your side. Often a “bad” item that is a year or two old can’t be verified because the records just aren’t there any more. Entities go out of business, move, or discard records rather than pay for the expense of storing them. The moral of this story is, go after the old stuff first. Even if the business is still in operation, they may not want to dig back through old records to verify the item in question. Remember, all you need is two weeks with no response and the item is gone.
The truth is that many people suffer from bad credit because they’ve never reviewed their credit report, cleaned up the errors, or disputed old items that are likely to be easily removed. Whether for lack of information or lack of energy, the most common stance people take is to simply accept their credit report without question. That’s a costly strategy and one that puts an unnecessary burden on millions of consumers every year. In 90 percent of cases, you do not need a lawyer or the assistance of a professional credit repair agency to remove bad credit from your report, you just need some personal initiative.