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How to Get Items Removed from your Credit Report

Posted On July 15, 2020

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Monitoring your credit report is an important first step in the mortgage process and generally good practice for your financial wellness.  Lenders use your credit score to determine your creditworthiness and whether you will be a good candidate to repay your mortgage loan based on your payment history, current balances, and other factors.  Derogatory marks on your credit report can significantly hurt your score and take years to recover.  It becomes even more complicated if the credit dings are not your fault and the result of identity theft or credit mistakes.

Monitoring your credit score gives you insight into what is going on in your credit report and can help you spot any suspicious activity as it happens.  The sooner you report suspicious activity the better your chances of repairing your credit.

What hurts your credit score?

Your FICO® credit score is influenced by five differently weighted factors: your payment history (35%), your total amount owed (30%), the length of your credit history (15%), new credit (10%), and credit mix (10%).  Paying your bills on time, keeping a low credit utilization ratio, and maintaining a healthy mix of credit types will all help you improve your score. 

Incidents that hurt your credit score include:

  • Late payments or non-payment
  • Having a charge-off
  • Bankruptcy
  • Foreclosure
  • Repossessions
  • Judgements
  • Collections

If someone steals your identity and has any of these events occur on a fraudulent account, you will bear the burden and be responsible for repayment or disputing it.

How do you become a victim of identity theft?

In the digital age, you are especially vulnerable to identity theft any time you go online through an unsecured network. 

Some common ways your information can get stolen include:

  • Theft of your physical credit card
  • Theft of your credit card information through an unsecured website
  • Malicious software
  • Mail theft
  • Phishing scams through email
  • Credit card skimming 

What to do if you find suspicious activity on your credit report

If you do find activity on your credit report that you believe is fraudulent you should report it right away.  Keep in mind if the derogatory marks are your own doing you will not be able to get rid of them before the specified amount of time.

  • Report with the Credit Bureau – there are three major credit reporting bureaus, Equifax, Experian, and TransUnion. If you notice fraudulent activity on your credit report, you will need to report to all three credit reporting bureaus separately. 
  • Dispute with the Business – if the derogatory mark is related to a specific transaction or financial institution you can dispute directly with the business involved.
  • Hire a Credit Repair Service – if there are numerous inaccuracies on your credit report, it could be worth it to hire a professional credit repair service. A credit repair service will work on your behalf to clean up your credit errors, dispute any inaccurate negative entries, and negotiate with creditors.
  • Free Credit Counseling – non-profit organizations like the National Foundation for Credit Counseling (NFCC) will guide you through the process of reviewing your credit report, talking to creditors, and creating a debt management plan at no cost.
  • Pay for Delete – if you’ve exhausted your other options, through a “pay-for-delete” letter you offer to pay the debt or a settlement sum in exchange for its removal from your report.

 All American consumers have access to a free annual credit report from Equifax, Experian, and TransUnion.  You can request your free credit report three ways:

  • Online: AnnualCreditReport.com
  • Over the Phone: (877) 322-8228
  • By Mail: Download and complete the request form from AnnualCreditReport.com. Mail the completed form to:

Annual Credit Report Request Service

P.O. Box 105281

Atlanta, GA 30348-5281

If you have any questions about how your credit report will impact your ability to buy a house, let us know.

 

Sources: Money.com