Credit scores are three-digit numbers that give lenders an indication of your credit health. This metric is more important than most people realize. You need good credit in order to qualify for rewards credit cards or rent an apartment. Employers may also request information about your credit report before hiring you. A good credit score will also help you qualify for the best mortgages or auto loans.
There are some standard steps you can take to maintain a good credit score. Paying your bills on-time and keeping credit usage in check will help you build the credit you need in later life. You’ll want to also check your credit report for any incorrect information or false reporting, which could negatively affect your score.
Remember that removing negative information from your credit report only works when it is untrue. on their website, the CFPB makes this very clear:
They write that “you cannot remove accurate but negative information from your credit report” and add that the majority of negative information will stay on your credit reports seven years.Ask a CFP (r) about 4 MUSTS for your next student loan
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How credit scores are calculated
You should also be familiar with the general concept of credit scores. There are probably other questions that you would like answered.
For instance, What is a high credit score? What is a low credit score,
You should first know that FICO is the most popular credit scoring model. VantageScore, on the other hand, is the second-most commonly used model.
We will focus this guide on FICO credit scores, as 90% of the top lenders use them. FICO scores are also between 300 and 800, with higher scores superior to lower scores.
According to MyFICO.com FICO credit scores can also be divided into the following ranges.
- Exceptional: 800+
- Excellent: 740-799
- Good: 670 to 739
- Fair: 580 to 555
- Poor: 580 or less
Experian reports that the average FICO credit score was 714 at the end of 2021. For the moment, this means that most American consumers are considered to have a good credit score.
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What to do if you find something wrong in your reports
You should read your credit reports at least once a year from each of the three credit bureaus – Experian Equifax and TransUnion – to keep your score as high as possible. This can help you identify inconsistencies and mistakes in your credit report. Checking your credit report is one way, according to the Federal Trade Commission to detect signs of identity fraud early on.
To get a look at your credit reports from all three bureaus, you should use the website AnnualCreditReport.com. You can check your credit reports online for free, up to one time per week.
How to dispute negative items on your credit reports
You should remove any errors you find on your credit report, especially if they are damaging your score. Remember that removing negative information from your credit reports is only possible if it’s actually inaccurate.
According to the FTC, you should dispute any inaccurate reporting both with the credit bureaus who report the information as well as the company that provided the data. You would have to dispute this information with Experian as well as Wells Fargo if, for instance, your Experian report indicates that you are late on a Wells Fargo auto loan. You would have to contact Experian and Wells Fargo if the false information appeared on all three credit reports.
You’ll need to follow these steps to dispute the information on your credit report:
- Step 1. Write down what you believe is incorrect on your credit report and why it is inaccurate.
- Step 2 Send a printed copy of your credit report with your letter. Highlight or circle any incorrect information.
- Step 2: Provide any evidence that you have to prove that the information provided is incorrect, for example a bill showing that your account balance has been paid.
- Step 4 : Write to the team and ask that you remove or update any incorrect information.
- Step 5 : Include your current contact information when you contact the companies, including your name, address and phone number.
You can send a single package of information to both the credit bureaus as well as the company who reported the information. Some credit bureaus have their own dispute forms that you can use.
You can send certified mail if you don’t want to dispute information online.
You can either send your information to a credit bureau by using the below information, or you can send it to the company that reports to you using the address on your credit report.
Professionals can write and file your dispute.
Find out if there are any items you can remove from your credit history. Talk to a credit expert today.
Credit Bureau Dispute Information
It’s worth noting that the top credit repair companies will do all this work on your behalf. These companies can not only check your credit report for errors but also dispute them on your behalf.
Lexington Law, for example, charges reasonable fees to handle all aspects of credit restoration, from disputing inaccurate information on your credit report, to bankruptcies and foreclosures. You can also complete the process over the phone and online, saving you the time of driving to a credit repair center or meeting someone in person.
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Common Credit Report Errors that Can Hurt You the Most
The Consumer Financial Protection Bureau reports that the following credit report mistakes are among the most common.
- Incorrect name or contact information
- There are incorrect accounts due to Identity theft
- Closed accounts reported as open
- Accounts falsely reported late or delinquent
- Incorrect dates for last payments
- List debts more than once
- Balances that are incorrect
- Credit reports that are incorrect
- Accounts with incorrect credit limits
You can avoid any of these mistakes from affecting your credit score by disputing incorrect data. This is a move that you should make at least once per year if you are wondering How to Build Your Credit Score.
Last Thoughts about Removing Negative Items From Your Credit
Checking your credit report every few months is a good way to increase your credit score and improve your chances of qualifying for a home loan, car loan or the Best Personal Loans. You can find errors and early signs of fraud by checking your credit reports every few months.
There are no negatives to checking your credit report for free and disputing any false information. You could regret not doing so.