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Wednesday, February 25, 2009

How to Dispute Credit Report

By Justin Hutto

Since a better payment history accounts for up to 35% of your score, disputing negative marks helps because it will show a better payment history. Disputing negative marks on your credit report is the most effective method of improving a low credit score.

To dispute a mark you need to contact the bureaus and send a dispute letter. A letter must be sent to each credit bureau. Often upon receipt of your letter the bureau will respond with a letter requesting more information about the item.

Because of this stall tactic used by the bureaus, people will most likely give up and keep on paying extreme interest rates. This delay is more cost effective for the bureaus as they do not have to actually investigate the dispute.

In time, the bureaus will investigate the mark only if another dispute letter is sent with the requested information. While investigating, the bureau will contact the lender to verify the disputed mark.

If the lender can not verify it then the bureau must remove it from your credit report. For optimal results we suggest you wait until the lender has received some form of payment for the outstanding debt. This is because lenders are often unwilling to spend the time and money verifying a debt that is no longer collectible.

For example, since a lender has no more use for a charged off credit card account that is sold to a collection agency, the lender will not take the time to confirm the account when contacted by the bureau.

You can you can hire a service to dispute your credit for you or create a dispute letter and dispute your credit yourself. It is simpler to get rid of a charge off once it has been sold rather than outstanding.

The benefit of a service is that it provides you with more options to remove a mark if it is confirmed. Services can ask for creditor direct interventions, debt confirmation, escalate dispute information requests, and in severe cases, an attorney can go to court and fight on your behalf.

You credit score is a very important number. It impacts your; finances, residence, place of employment and many more. It is estimated that 25% of Americans have an error on their report and that is costing them money in higher interest rates.

In summary, by disputing your credit yourself with a dispute letter or by hiring a service to do it for you, you can remove negative items from your credit report and stop paying the high cost of bad credit.

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