Clean Up Your Credit History In 5 Steps

Knowing how to clean up your credit history is extremely important. The ability to be patient and persistent can be the key to removing damaging information from your credit report.

Step 1 – Review Your Current Credit Report

You are entitled to a free copy of your credit history every year. You are also entitled to a free copy if you have been denied credit or employment as a result of information contained on a credit history report. Order a copy of your credit report and carefully review it for errors, mistakes and incorrect information. Almost every credit report has mistakes and erroneous information, so be prepared to challenge several items every year.

As you go through the report make careful note of problems and why they are problems (account not your account, account settled, inaccurate account information, etc).

Step 2 – Collect Supporting Data

If you are going to challenge incorrect entries, then you will need to provide supporting data if at all possible. This includes copies of cancelled checks, letters from the creditor settling the debt, bankruptcy discharge information and anything else that you can provide to support your position that the information is reported in error.

Of course, this is not possible if an account has been either completely reported incorrectly or an account was opened in your name fraudulently. In this case, you will need to state why the information is incorrect.

Step 3 – Challenge Entries

For each incorrect or invalid entry, you will need to write a letter challenging it. In your letter include your contact information (name, address, social security number, date of birth) and what is incorrect on your credit history report. Include copies of any supporting data.

By law, credit reporting agencies are required to conduct an investigation and make corrections or changes within 30 days. An investigation includes contacting the reporting creditor and verifying the reported information. If the creditor does not provide evidence to support the reported information, then the entry must be corrected or deleted.

Step 4 – Report Omitted Positive Credit

One of the lesser used methods of cleaning up credit history is to proactively report positive credit information that is not included in the current credit report. Many smaller companies do not report credit information, including utility companies.

When providing this information to a credit agency, include your contact information and the information about the credit account. If possible, include copies of payments, payment history and account number.

Step 5 – Review Updated Credit History Report

Once the credit reporting agency has completed their investigation, they are required to send you a copy of your new updated credit report within 30 days. When you receive it, carefully review the information, verifying that the errors have been corrected or deleted. Also look for any new entries that might be invalid or incorrect.

Summary

Taking all of these steps in combination, not only will you discover that your credit history improves, but your credit score should improve. Almost all credit reports have errors, invalid entries and omissions. By being proactive and correcting information, you can substantially improve your credit score.