Correcting Your Credit Report

What can you do if your credit report contains incorrect or derogatory information?

If the information in your report is inaccurate or unfair you will need to correct it. This can take some time and effort on your part, but remember--a negative report will haunt you for at least seven years.

First contact the creditor that filed the complaint, correct the error and ask that any credit bureaus involved be notified in writing. Be sure to document your efforts. If the credit bureau made the mistake, challenge it. By Federal law, it will have to delete the disputed information if it cannot be confirmed. Both the credit bureau and the creditor who filed the derogatory informataion must help you resolve the issue in a timely manner, within 30 days.

If the credit bureau finds their information to be confirmed, you may still attach a "Statement of Dispute," to argue your side of the story. (For example: "I returned that purchase, and they lost the credit slip.") This should not be confused with an explanatory note that might say something such as, "I lost my job and wasn't able to pay my bills that month." Warning: explanatory notes can do more harm than good, and because of the seven year holding period both notes might actually stay on your record longer than the original problem transaction.

With new regulations effective October 1997, both your creditor and the credit bureaus must take reasonable steps to ensure that incorrect information does not reappear in your file after it has been removed.

A couple notes: Paying off a delinquent account will clarify that nothing more is owed, but the fact that it was once delinquent can stay on your record up to seven years. In the same vein, closing an account doesn't remove it from your credit report.

Once corrected, the credit bureau will send a revised copy of your report to any credit grantor who requested it over the past six months. However, they many only do so if you ask them to send it. 

(Please return to "Getting a Copy" for the addresses of the three main Credit Bureaus).