Archive for July, 2009
Thursday, July 30th, 2009
When it comes to your rights regarding Credit Reporting Agencies, collection agencies and creditors, the Fair Credit Reporting Act and the Fair Debt Collection Practices Act are the two laws that govern. You can go to the FTC website and download these in a PDF if you like. If you can wade through these and understand them, then you will be better qualified in credit law than 98% of the staff of any CRA or collection agency.
If you are not a law junky here are a few strategies for getting derogatory information off your report.
There are basically two approaches to changing or deleting negative information; requesting verification of the accuracy of an item or disputing the validity (not mine) of an item.
The first thing you want to do is review your report for inaccurate spellings of your name and employers plus any old addresses that might show. Send a letter to the CRA asking that these items be removed. You can argue that the addresses are not relevant and that the names and employers are not accurate. The reason you want to remove these items is to remove the possibility of a collection agency using them to validate a debt. Always communicate in writing, preferably certified mail with return receipt requested. While it is more convenient to use the online form offered on the CRA website, you want proof that the communication was received and an electronic confirmation is not as powerful as a green postcard from the post office.
The next step is to review each negative item and determine what, if anything, to do about it. Look at the last date of activity. If this is a really old item and nearing the 7 year Statute of Limitations (SOL) then it may be wise to do nothing and let it roll off.
One of the rights that the law allows you is the opportunity to have an item verified. You can submit a request that an item be verified for accuracy. Include any back up data you have (copies not originals). The CRA must investigate any verification request to prove the debt is yours. This investigation must be accomplished in by the CRA within 30 days. If you are requesting verification of a public record like a bankruptcy or lien, the CRA can make short work of it because of the abundance of public record databases available to them.
If however, you want verification on an item posted by say a collection agency, it’s not so simple for them. If you think about it for a moment, they have millions of files and thousands of validation requests at any given time, how easy can it be. In some cases they may remove the item simply because it is the best business decision to do so. In other cases, if the investigation is not completed in thirty days (aren’t you glad you have that green postcard from the USPO that shows when the letter was delivered), you can demand that it be deleted.
Validation is not saying an item is not correct, it is saying prove to me that it is mine. You can’t request validation on an item posted by an original creditor. You can however, request it on items posted by collection agencies. If you’ve been through the harassing calls of a credit agency you probably discovered that the agency calling changes from time to time. That’s because your account has been sold over and over again. Getting validation that they have a legal right to collect the debt, or that the debt is actually yours, can be difficult and time consuming the further down the food chain the collection agency is.
Here’s an interesting side note. If you have a collection agency calling you now, send them a letter demanding that they validate the debt and their legal right to collect it per the FDCPA (again with the green postcard). They have to stop all collection activity until they respond to you. No calls, no letters. Unlike the CRA there is no time limit on their response to you.
So get your report out and start planning a strategy. Nothing gets done until you do something first.
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Monday, July 27th, 2009
To get collections removed from a credit report there is a process to follow. There is also a big misconception out there that you can get collections removed that you owe. Yes you can get collections removed but there is seasoning requirement in order to get them removed. In this article we will discuss what can and can’t be removed from your credit report.
Get a copy of your credit report with credit scores
If you want get collections removed you obviously need to know what is being reported on your free credit score report. You also need to make sure you pull a 3-1 credit report with all 3 of your credit scores. Once you have done this then you can determine what you need to start disputing. I see a common problem all the time, and that problem is people disputing information they owe. That does absolutely no good unless the original collection date has expired per the Fair Credit Reporting Act (FCRA). Here is list of when certain collections will expire and are to be removed from your credit report by law.
Derogatory expirations guidelines:
* Chapter 7 – 10yrs
* Chapter 13 – 7 yrs
* Tax Lien – Until paid off
* Child support – Until paid off
* Collections – 7yrs
* Chare Offs – 7 yrs
* Late payments – 7yrs
* Inquires – 24 months
* Foreclosure – 7 yrs
* Repossession – 7 yrs
* Judgments – 7yrs
*Expirations date starts ticking from the original collection date.
Dispute expired items on credit report
Once you have reviewed what derogatory information on your credit report is inaccurate, make sure you highlight those items on your report. Determine which collections, late payments, charge off, etc….. are set to expire or have already expired. Now you can start the on-line disputing process. I am personally a fan of disputing on-line for the simple fact that it is faster and easier. The credit bureaus will be able to verify the original collection date after you dispute. If the bureau finds you are correct they will remove the derogatory remark. This will start increasing your credit scores. If the collection has not expired don’t dispute it, you are wasting your time. The collection will not be removed unless the expiration date has expired. Folks it’s really that simple. There is no quick way to get bad credit removed. Just remember if you are late on a obligation you can expect your credit score to drop around 150 points, and the negative mark will be on your credit report for 7 yrs. So with all of this being said, make sure you pay all your bills on-time.
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Friday, July 24th, 2009
You must dispute a collection to remove it from your credit report. A dispute needs to be filed directly with the credit bureaus. A dispute letter must be sent to each bureau. In your letter you have to identify the mark you are challenging and explain why it is inaccurate and should be erased from your report.
Upon receipt of your letter the bureaus will conduct an investigation into the item. If the challenged item is verified then a credit repair service can be very helpful. This service will be able to use advanced techniques such as; escalated dispute information requests, debt validation, and creditor direct intervention.
What is a collection?
Your account will go into this after 6 months or more of delinquency. It is a lenders last resort to recover payment. Most lenders have some form of in house service. However many also will use an outside agency and/or sell your debt. These agencies will either work with lenders or purchase your debt outright. An agency is often brought in to collect on delinquent accounts and they are paid a percentage of every dollar recovered.
Be aware that if you just pay, the item will still remain on your credit report. It will change the status of the mark but it will not be removed from your report. Future lenders will still see the mark as a derogatory item even when paid. In sum you can remove collections from your credit report. You do not have to live with bad credit items for 7 years.
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Tuesday, July 21st, 2009
There are a lot of people who are forced by circumstances to declare bankruptcy. Unfortunately, once they have declared bankruptcy, their credit score goes south fast. You might as well have the words “risky” and “unworthy” tattooed on your forehead. It is highly doubtful if you would be able to secure loans when you have a history of bankruptcy. This does take a toll on your credit score, and often, your credit score will take a plunge.
Can you remove bankruptcy from credit report? Many people will argue that you cannot. They’d point out the “impossibility” of removing it from your credit report. However, you definitely can do something about it. Bankruptcy is disputable. You can dispute it the same way you can question other derogatory accounts on your report.
“But that account is truly mine! How can I dispute it?” Take note that whether the record or account is truly yours – it doesn’t matter. The question that would be asked by the credit bureaus is – “Can it be verified?” If an account is verifiable, it stays. However, if the bureau cannot verify the account, it can be deleted from your credit report. The burden of proof here does not even rests on you. It rests on the credit bureau concerned. So, can you remove bankruptcy from credit report? Yes, you can.
There are some things that you should avoid when you try to repair your bad credit report. First and foremost, you must be completely honest. Not only is it risky, it is also unnecessary. You can dispute and try to repair your own credit report without resorting to lying.
When it comes to disputes like this, you’d probably like to know that most credit bureaus do not check public records. You can dispute an account and remove bankruptcy from credit report without an agency resorting to your public records. Yes, they say that they do and they claim that they have a system for it but they really don’t. Credit bureaus also avoid having you or anyone else resorting to the courts for any legal concerns.
Honestly, it is a tedious process. People will not be lying if they say that in order to delete bankruptcy from credit report, you might have to invest a lot of your time and energy into it. Bankruptcy is without a doubt the hardest item to remove from a credit report. Often, people would say that in order for you to remove bankruptcy from credit report, you would have to remove every other bad accounts from your report.
Read your credit report carefully. Make sure everything is in order including your address. Often, your debts and credit history is tied with your address. Take note of the accounts that are “included in bankruptcy” and place them in dispute. Creditors have very little resources to verify the veracity of these accounts.
When you filed for bankruptcy, you wanted a fresh start. It will not do you good if your bankruptcy history would haunt you financially. Dispute anything that is not accurate so that you’d remove bankruptcy from your credit report.
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Monday, July 20th, 2009
Having a Bankruptcy on your credit report can be an awful thing to overcome. When you need to apply for credit this is the first thing that will jump out at the lender. It is said that is can be almost impossible to remove a bankruptcy from your credit report. The truth is is is hard to do this but you can remove negative items from your credit report which will in turn improve your credit score.
Information that is found on your credit report must be verified so that you do not have any marks on your report that are not yours, this will cause you to have a hard time getting any new credit. It is the credit reporting agencies responsibility to verify that the information is correct, if they can not verify it they are required to remove it by law. Be aware that these agencies do not investigate public records and if it is up to the courts they only verify in person. It is important for you to know what your rights are and be able to act on them so that you will be on the winning side of this issue.
It is always a good idea to monitor your credit report all the time to make sure it is correct and accurate. If you see negative items on your report you need to dispute them and do any follows ups to make sure they have been removed. This is your personal financial information and it is up to you to be on top of it and do not let the credit reporting agencies have negative or false information reported on you.
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