Disputing Negative Credit Entries

If you have negative items on your credit report, there is something that you can do about it. You have the legal right to dispute any negative or incorrect entry in your credit file at any time; and by doing so, you make absolutely no admission of liability for the debt. In disputing a negative item, you're merely challenging the accuracy or validity of the information reported about you.

In understanding your credit and how our credit reporting system works, it's important to remember two crucial facts. First, be aware that anyone – whether they're a legitimate creditor or not – can submit negative information to be placed in your credit file. This can be done completely without your knowledge or your consent; and further, the information need not be proved accurate. Second, the credit bureaus' primary function is that of a storehouse and disseminator of this received information and, as such, they have no legal obligation to investigate the veracity of the data sent to them – at least, not until you contact them to challenge it.

This is one of the core reasons that mistakes and incorrect facts and figures are such a common occurrence in credit files. Fortunately, federal law – namely, the Fair Credit Reporting Act (FCRA) – gives you the right to challenge any damaging information contained in your report. It also imposes upon creditors and the credit bureaus the responsibility that they verify in a timely manner whatever information you choose to dispute, or require it be removed from your file.

Because damaging information can so easily be placed against you, lawmakers agreed that the burden of proof for any such data should be placed upon the information's source; that is, the creditor. Once you challenge an entry on your report (and this must be done in writing), the credit bureau must investigate and reach a conclusion on the matter within thirty days, or a reasonable time thereafter. For example, if you submit additional information concerning an item, the credit bureau will have an additional fifteen-day extension to confirm those facts. The credit bureau seeks to validate the information contained in the file by contacting the creditor.

It should be noted that the creditor must also heed the thirty-day time frame from the date of notice of your dispute. Oftentimes this deadline, along with the inability or inconvenience of retrieving account information (especially if the account is old or has been transferred) makes compliance difficult or even impossible for the creditor. If the creditor deems the request too burdensome or not worth the time, it may simply forego a response back to the credit bureau within the allotted time. When this happens, by default the negative mark must automatically be deleted from the credit file.

Many credit repair companies operate solely on this premise. And because of just such a lack of creditor response within the required thirty-day time period (which, by percentage, may be significantly higher than you probably think), many negative entries are erased. By being aware of the law and your rights, you can do the same thing and obtain the same results that these companies tout, and do it for considerably less than they might charge.


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