How to Remove Items From Your Credit Report in 2022
Your credit report is supposed to reflect your financial history in full, but mistakes can and often do occur.
Don’t over dependent on inaccurate details that may be lowering your credit rating.
Understand how to eliminate incorrect details from your credit report. Also, understand that the true scores you face will be negative (however correct).
How to remove negative items from your credit report
You have the right to access the information in your credit history.
Under the Fair Credit Reporting Act (FCRA), credit bureaus and lenders must ensure that the data they report is honest and accurate.
You have the right to dispute incorrect or incomplete information from your credit reports. If the dispute results in data being corrected or altered, the information in question must be removed from your file.
A couple of frequent credit-reporting errors include payments mislabeled as late or closed accounts still being listed as open. It’s also possible for your credit report to contain data from someone else, possibly with the same Social Security number, name, or identifying information.
Keep in mind that inaccurate information can be excluded from your credit score. So in that case, your score might be dragged down by accurate negative information if you are required to make payments promptly and pay off your debt over time.
Here are some things you can do to fix your credit score:
1. Get a free copy of your credit report
It’s vital to examine your credit report frequently — every year, if not more often — so you can catch any abnormalities early.
In accordance with federal laws, you have the right to obtain a free credit report annually from all three credit bureaus (Equifax, Experian, and TransUnion). Because of the spread of COVID-19, however, all three bureaus will provide free weekly reports until April 2022.
It is the sole federally authorized source you can request your annual free credit report online. Be sure to check your credit reports from each of the bureaus because there can be variance in the information from creditors and lenders.
You can even indicate them by:
Phone: (877) 322-8228
Mail: Download, print, and complete the request form and mail to:
Annual Credit Report Request Service
P.O. Box 105281
Atlanta, GA 30348-5281
You may also request additional copies of your annual statement for free.
- You were denied credit, insurance, or employment in the past 60 days.
- Your credit limit or insurance coverage may change suddenly.
- You’re receiving government benefits.
- You’re a victim of identity fraud.
- You’re unemployed and/or will apply for employment within 60 days from the date of your request.
Other ways to get your credit report
While you can get free reports from AnnualCreditReport.com, do keep in mind that none of these include your credit score. So, if you wish to keep an eye on your FICO or Vantage scores, you’ll have to request reports from the agency directly.
The four major credit bureaus offer credit monitoring services, which grant access to your credit report and score, among other benefits.
Experian’s premium credit monitoring costs $24.99 a month and comes with a 30-day free trial period. The subscription includes daily updates, monthly reports, and FICO scores. It also includes ID theft protection and fraud resolution services, as well as credit monitoring that can be used for spotting errors in the early stages of the application process.
Equifax offers three plans that range in cost from $4.95 to $19.95 per month. These plans may include daily credit report updates, credit monitoring from any one of the bureaus (depending on the plan), or identity theft protection.
TransUnion’s plan costs $24.95 per month. It monitors three major credit bureaus in real time, sending alerts on applications using your name and featuring personalized tips to improve your score.
However, Experian and Equifax do not have free subscriptions available. These memberships do not include access to reports from competing agencies and the information contained therein is updated monthly (paid memberships are generally updated daily).
2. File a dispute with the credit reporting agency
When you receive your report, examine each account to make sure everything is reported correctly. You should also document whether the older findings have been deleted.
If you don’t catch errors in your reports in a timely fashion, initiate a dispute directly with the reporting bureau through its website or by mail. This will stir an investigation on the latter’s part.
Plan to ensure you contest with every firm to ensure the removal is complete across the board.
How to file a dispute online
Each bureau, including Equifax, Experian, and TransUnion, features a section on its website dedicated to assisting users with the online dispute process. By creating an account, an individual can file an unlimited number of disputes and check their progress at no cost.
How to file a dispute letter
You can also submit your dispute letter to the bureaus, detailing the inaccuracies you have discovered on your credit report. When composing your letter, make sure to include documentation and detailing why you are contesting the claim. The Consumer Financial Protection Bureau (CFPB) recommends mailing a copy of the report to dispute the error circled or highlighted.
These are some of the documents you can provide if the information being presented is in disagreement: the tax return, a previously filed tax return, a form, to name a few.
- Credit card or bank statements
- Copies of checks
- Letters from lenders certifying mistakes
- Pay stubs
- W-2 forms
- Utility bills
- Proof of identity (birth certificate, driver’s license, passport, for example)
- Police reports (in the case of identity theft)
Send the letter by certified mail and request a receipt. This will prove that the reporting agency received the letter, and you will receive a certified mail signature as evidence of this. Keep the original certified mail signature, along with copies of the letter and any enclosed documents.
The Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) both have templates you may use for this purpose.
Dispute letters should be mailed to:
Equifax Information Services, LLC
P.O. Box 740256
Atlanta, GA 30374
Include this dispute form with your letter.
P.O. Box 4500
Allen, TX 75013
TransUnion Consumer Solutions
Consumer Dispute Center
P.O. Box 2000
Chester, PA 19016
Include this dispute form with your letter.
3. File a dispute directly with the creditor
If you have a dispute with your creditor, it is also advised to get in touch with the company that provided your credit report to the Bureau. It is then required to investigate and respond to all disputes that may undermine your credit score.
Be sure to include as much documentation as possible to support your claim. You will also need to include a copy of a report documenting the error.
Your mailing address is listed on your report under the negative item you are disputing. You may also contact the lender directly to verify the mailing address and the documents you need to submit.
Should the lender identify that it was wrong or is unable to prove that the debt actually belongs to you, it will notify the bureau and ask it to update your file.
4. Review the claim results
Investigations and borrowing banks normally take less than 30 days to issue arbitration decisions. They will inform you within five days of completing their decision on the disputed product. You will receive notice if the product was found to be false or not.
If the disputed information proved to be inaccurate, the bureau must update or delete the item. They will give you a free copy of your information if the dispute results in a change.
If the bureau or lender determines your initial data is not an error, you can file a supplemental claim. Review your initial claim for any errors and take steps to correct them. If possible, you should include additional documentation to support your request, which might help the Bureau evaluate any info it might have missed the first time.
5. Hire a credit repair service
Resolving your disputes takes time and may take more time if your history has a lot of mistakes or if you were a victim of identity theft. Reputable credit repair companies, such as Credit Saint, Lexington Law, and Sky Blue, may be suitable options if your file is riddled with inaccuracies.
Credit repair agencies can help you dispute inaccurate negative information and mediate with creditors on your behalf. On the other hand, if you’re thinking of hiring a credit repair agency, note that there are consumer protection laws dictating how they work and what they are permitted to do. The Credit Repair Organizations Act (CROA) defines the following about credit repair services:
- They cannot provide false or misleading information concerning a person’s credit status and identification
- They must provide a detailed description of the services they provide
- They cannot charge for their services until they has been completed (although most of them do charge a small initial work fee)
- There must be a written contract detailing the services they’ll provide, the time frame in which these services will be provided and the total cost for them
- They cannot promise to remove truthful information from your record before the term set by law (seven years for most derogatory items, ten years for some bankruptcies)
- You have three days in which to review the contract and cancel without penalty
Before subscribing to one of these companies, it is critical to understand what they can and can’t do. For example, any company that guarantees removal of accurate negative items or the creation of a new identity for you is most likely engaging in inappropriate practices or a scam.
Can I Dispute Accurate Information From My Credit Report?
Incorrect items in your credit report can’t be retyped or revised before your examine period has ended (except for negative items). For example, should you miss payments on your credit card or default on a loan, your dispute done by the Examine Your Credit Bureau request will be considered.
There are a few things that may help you with your credit report. Here’s what they are.
1. Send a request for “goodwill deletion”
Composing a goodwill letter to the firm might be an option for people who are compliant, even so have had issues with creditors. If you’ve taken necessary steps to pay down your overall debt and have been paying your monthly obligations on time, you may be able to convince your creditor to “forgive” the late charge.
There’s no guarantee of whether this information will be erased from the record, but this approach is helpful for handling one-time problems, such as one late payment. Goodwill letters aren’t recommended for debtors who have a history of late payments, defaults, or collections, however.
When writing the letter:
- Take responsibility for the issue that lead to the derogatory mark
- Explain why you didn’t pay the account
- If you can, point out good payment history before the incident
2. Work with a credit counseling agency
Several non-profit credit counseling organizations, such as the National Foundation for Credit Counseling (NFCC), can help dispute inaccurate information on your report.
The National Foundation for Credit Counseling helps consumers review their credit ratings, create budgets, and develop a plan to manage their finances. It also offers financial guidance in cases involving residential mortgages, bankruptcy and foreclosure prevention.
Prior to the service being provided, avoid vendors that claim that their services are “too good to be true” and should not demand a payment in advance.
When looking for a legitimate credit counselor, the FTC advises consumers to check if they have any complaints with:
- Your state’s Attorney General
- Local consumer protection agencies
- The United States Trustee program
Are pay-for-delete negotiations worth it?
Pay-for-delete is a negotiation method in which you offer to pay your debt (partly or in full) in exchange for the debt collection agency to remove negative entries from your record. Since collection providers typically aim to get as much money as possible back, paying the debt may incentivize them to remove the negative entry. However, pay-for-delete is not a foolproof solution, and it falls in a legal gray zone.
Collection agencies must report accurate information, just like creditors and reporting companies. You may request it, but a collection agency is not obligated to remove your collection entry; it can choose to specifically indicate the status as paid, which is exactly what actually happened.
Keep in mind that your credit score depends on the credit model used to compute it (FICO 9 and VantageScore 4.0), and taking advantage of paid collections won’t affect your score as your latest credit score models take paid collections into account. Nevertheless, unpaid bills will nonetheless affect your credit rating.
Avoid the following strategies
Even though certain measures might be tempting when attempting to improve your credit score, they could often result in more harm than good. Stay away from the list below:
Closing a line of credit that is already behind on payments
Closing a card that’s behind on payments doesn’t pay the debt positively affecting your credit rating by lowering your financial-to-credit ratio, also known as your credit-to-debt ratio. The ratio is equal to all of the credit you’re using divided by the total amount of total credit.
For example, if you have two credit cards, each with a maximum credit limit of $5,000, your total available credit is $10,000. Owing $3,000 on one card and $2,000 on the other would mean you’re using 50% of your total available credit.
To improve your credit score, experts recommend keeping your credit utilization below 30%. Following the example mentioned above, that would mean that you could use no more than $3,000 or less per month.
If you close your credit card instead of paying it, you’ll have less available credit. Creditors will evaluate your debt-to-credit ratio when you are applying for new loans or credit cards. If your ratio exceeds that threshold, they might classify you as a high-risk borrower, provide less attractive interest rates, or even deny you credit altogether.
Filing for bankruptcy
Bankruptcy should be regarded as a last resort — it could negatively impact your credit score and affect your ability to borrow, get mortgages or obtain credit for several years after your debts are discharged.
There are two kinds of bankruptcies that are available to individuals: Chapter 7 and Chapter 13. A third kind, Chapter 11, is intended for businesses.
The court subjects your assets to liquidation after you have filed a Chapter 7 bankruptcy filing. A trustee is subsequently appointed to review your finances and sell off any remaining non-exempt assets.
A Chapter 13 bankruptcy lets you keep your assets if you complete a court-mandated repayment routine geared toward paying your principal obligations.
Impact of bankruptcy on your credit report
Pursuing chapter 7 bankruptcy will lower your FICO score below 200 points. Lenders may also deny you the credit you need for many years.
A bad credit record will remain on record for up to 10 years if you file for Chapter 7 bankruptcy, and it will be seven years if you file for Chapter 13.
Common credit report errors to look out for
The Consumer Financial Protection Bureau reports that the most common mistakes consumers see on their credit history are listed here: missed credit card or mortgage payments.
- Wrong name, address or phone number
- Accounts from someone with a similar name
- New credit accounts opened by someone who stole your identity
Incorrect account status
- Accounts wrongfully labeled as open, past due or delinquent
- Accounts that wrongfully listed you as the owner instead of authorized user
- Wrong date for the last payment received, date the account was opened or delinquency status
- Same debt listed multiple times
- Information that is not removed, despite already being disputed and corrected
- Accounts that are listed multiple times, with different creditors
- Incorrect current balance
- Incorrect credit limit
Negative credit report entries that impact your score the most
The most negative report items remain in your files for approximately seven years. Fortunately, their impact decreases as time goes on, even if they are still on the report.
If your past credit reports do not receive unfavorable assessments, you’ll have a more favorable result if you decide to manage your debt to receive a glowing report. Older credit reports will be worth less when they’re compared to other reports.
These are the most common things that can negatively affect your credit score:
Multiple hard inquiries
Numerous hard checks on your credit over a short period of time may be a signal to lenders, suggesting that you’re frequently looking for debt and do not seem to be getting the loans you request.
However, there are also some exceptions to this. For example, if you are looking to buy a home and want to compare mortgage rates between several lenders, you can do so. FICO and VantageScore, the two most commonly used credit scoring models, usually allow consumers a window of 14 to 45 days to compare rates (known as rate shopping).
Payment history is undoubtedly the biggest influencer when calculating credit scores. If you’re frequently late or not paying at all, your credit score will be profoundly diminished. Paying three days late will likely not affect your score since all the bureaus aren’t notified until moments appear. However, if you’re late 30 or more days, it will have a significant influence on your score.
A foreclosure can cause a poor credit rating to drop one tier. According to FICO, a change in your credit score can take place as much as 100 points after a foreclosure, based on the starting score. Foreclosures remain on your credit score record for a few years.
Charge-off happens when a creditor stops expecting a debt to be paid. This can happen if a debt is not paid with 180 days — although some creditors might charge off a debt in as little as 90 days. Charge-offs can negatively impact your credit score by 100 points or more.
If your score is significantly lowered by repossessions, they are likely following the series of missed payments that lead to it.
A collection agency or debtor might sue you for payment, and you could suffer a judgment that requires you to pay the debt along with other fees and attorney fees. This judgment might have a negative effect on your credit rating.
The original creditor might hire someone to collect payment on behalf of the initial creditor when a customer defaults on a credit. These collections fall under the division of debt history, and can remove more than a hundred points from the FICO score.
What makes up your credit score?
VantageScore and FICO are primarily utilized to calculate credit scores, and each has its own proprietary metrics and criteria. However, both models have one thing in common: information regarding major credit reporting agencies is used to create your score.
Understanding how VantageScore and FICO calculate scores will help you eliminate bad credit.
VantageScore 4.0 Scoring Model
VantageScore prioritizes total credit utilization, sky-high balance and available credit. Basically, the scoring model determines how much credit you have available to use and how much you are using. If you are 30% or more of your available credit, your score is reduced because most lenders view this as a red flag.
Other factors considered include your credit score, payment history, credit history length and new accounts.
FICO Scoring Model
The FICO score is the industry standard — it’s the oldest credit scoring model, and it’s used by a majority of lenders to evaluate a person’s creditworthiness. The FICO scoring system is made up of five categories, each with a weight indicating the percentage attached to them.
- Payment history (35%): Your payment history includes both on-time and late payments, collections, as well as record of bankruptcy or repossessions — if any.
- Amounts owed (30%): This factor considers how much you owe on your cards and loans. It also evaluates how much of your available credit you’re using every month.
- Length of your credit history (15%): The length, or age, of your history is usually estimated based on how long you’ve had your oldest account, when you opened the newest one and how long it’s been since you last used your active accounts.
- Credit mix (10%): Credit mix refers to the types of accounts included in your report — like credit cards, installment loans and mortgage loans. Having different accounts in good standing can help boost your score. However, it’s entirely possible to have only one type on record and have an excellent score.
- New credit (10%): Recent credit inquiries and recently opened accounts can lower your score by a few points, but not for a long time.
Impact of identity theft on your credit report
Identity theft – When the thief uses your information to open new financial accounts, the consequences can be serious for your credit score. The effect on your score is even higher if your new accounts are delinquent or if the cyberthieves made repeated applications in a short time period.
It will take you a few years to completely back away from identity theft, but the longer it takes you to put in security measures to avoid becoming victim to it, the more challenging it’ll be to reset the damage. By keeping your credit reporting in check and always monitoring your credit score, you can protect your personal information from cybercriminals.
How to remove negative items related to identity theft
If you believe you are a victim of identity fraud, file a dispute with the Federal Trade Commission (FTC) online at IdentityTheft.gov or at 1-877-438-433
To prevent further damage to your credit history, these are the steps you should take:
- Notify the incident to Transunion, Experian and Equifax through phone or mail
- Place a security freeze and fraud alert on your credit report
- Request a copy of your credit report through AnnualCreditReport.com
- Look out for unauthorized transactions or new accounts that don’t belong to you
- Contact creditors to close compromised accounts
- Consider subscribing to an identity theft protection or credit monitoring service
COVID-19 and credit repair: What you should know
The Coronavirus Aid, Relief, and Economic Security (CARES) Act provided consumer financial relief in the wake of the COVID-19 pandemic.
Lenders still have the option of reporting late payments, but these measures are aimed at making it easier for customers to avoid such delays. These include the same level as traditional credit bureaus.
- Payment plans
- Mortgage forbearance
- Deferred payments
- Loan modifications
- Reduced interest rates
- Loan extensions
- Waiving late fees
You will have to apply via your bank and, if accepted, your bills will not reflect any new negative modifications.
In May 2020, Experian, Equifax, and TransUnion plan to continue offering free weekly credit reports through AnnualCreditReport.com, which you can then use to keep an eye on and protect your finances during the COVID-19 pandemic.