Please click here to view Part 2

 

Myth No. 1 – It is very easy to dispute a credit report. Consumer’s can resolve their own issues.

 

To be honest, it IS easy to challenge a credit report. However, as an everyday person, it’s amazingly difficult and frustrating to get results from the credit bureaus. Here’s why.

 

This is a little-known fact. Credit Bureaus, Information Furnishers and Reporting Companies are consistently in the top 15 consumer complaints filed with the FTC.  Mainly because they don’t VERIFY information!

 

You see the main objective of credit bureaus is to protect their profits. They are NOT government agencies. They are “for profit” organizations. Anytime they have to investigate a consumer disputes it eats into those profits. Investigations take up time and energy too.

 

The credit bureaus do everything in their power to make restoring your credit exceedingly difficult, short of sparking massive lawsuits.

 

Attempting to restore your own credit means you must be willing to spend time learning about the process. This is why it is so difficult when you are inexperienced.  Realize that credit restoration will most likely take longer than you expect.  In most cases, it would benefit you to hire a professional..

 

Myth No. 2 –A negative item that is successfully removed from your credit report will simply reappear again.

 

The reality is that a creditor has 30 days to verify a dispute (unless there is a good reason to extend).  If the credit bureau has not heard from the creditor within that timeframe, they must delete the item from your report.

 

Sometimes the bureaus will perform a soft delete.  This is where they delete the item from your report but, will reinsert the item if they hear from the creditor within a week or two after the 30 days.

 

If this happens, the item can be disputed again.  However, most of the time, once an item is deleted, it is gone for good.  By using a credit restoration service or attorney, you can be sure your item will be disputed over and over again until it is removed.  Many of my clients have had HUGE success by following this route.

 

Myth No. 3 – Bankruptcies, foreclosures and tax liens can never be taken off your credit report.

 

Approached correctly, any negative listing can be removed.  That is why it is best to work with a professional.  They have the experience and know how to remove these items.

 

Myth No. 4 – The credit agency permits a 100-word paragraph to be entered on an account to explain the situation. Creditor’s take this statement into consideration when they’re weighing they’re options about extending credit.

 

This seems reasonable, but it’s not correct. When we talk about creditors, we’re talking about people who are loaning money – for credit cards, mortgages, cars, department store credit cards. Most of their approval is done via a computer which cannot read or interpret “explanations.”

 

The first thing we want to delete from your credit file would be the 100-word explanation. In essence, the explanation is seen as an admission of guilt. It’s actually the last thing you want to do. It verifies that something happened. You don’t want to do that.

 

Myth No. 5 – Paying off a past-due account (like a collection account or a charge off) will change your account to a “paid” status and it will no longer reflect negatively.

 

Again, sounds reasonable, right?  It is nearly impossible to completely fix your credit unless you settle your unpaid debts. However, as strange as it may sound, paying off a debt can have a negative impact on your credit rating.

 

Aside from bankruptcy, which can appear on your credit report for up to ten years, negative items may be kept on your report for up to seven years. The date of last activity starts the 7 or 10-year time period. Making a payment “resets” the clock because it is considered new activity.

 

So if this item was two years old, when you make a payment on the collection, the two years are wiped away and you start at day one again. It appears to the credit scoring computer as an item that happened yesterday.

 

Anything that happened yesterday affects your credit score more than something from two years ago does. This will damage your report, as it looks like the credit bureau forced you to pay up. Since you can do more harm than good, even though your intentions are right, it is always best to work with a professional when trying to restore your credit.

Please click here to view Part 2

Resources

Credit Reports, Credit Scores, Identity Theft Protection from Equifax

Credit bureau – Wikipedia, the free encyclopedia

Credit Report, Credit Scores & Credit Checks | TransUnion

Credit Report and Credit Score with Toll-Free Support from Experian

Credit Bureaus and Credit Scoring | USA.gov

Credit Bureau Contact Information – Experian, Equifax, TransUnion

 

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