How to Dispute Your Equifax, Experian and Transunion Credit File
Correcting credit errors such as charge offs and collections is not usually performed overnight. However, it is a quicker process if you dispute items in the proper order.
Bad credit items impact your score differently depending on their severity. Recent judgments and collections are often the most damaging.
Here is a complete list of the negative credit items along with how much impact they have on your score.
Public Records/Bankruptcy are the most severe. Public records include tax liens and court judgments. These items are allowed to remain on your credit report for 10 years – as opposed to the seven years limitation rule that applies to other items.
When you file bankruptcy, you will have multiple negative credit items. You will have the bankruptcy itself as well as any items that were included in the bankruptcy case. All these notations are equally severe.
Collection items are very severely damaging. Try to negotiate with the agency for a complete deletion. You do not want to have a paid collection, or settled collection on your credit file.
A foreclosure and a repossession can prevent you from getting credit for a home and/or car in the future. These are looked as very severe.
A charge off is very severe. You may even have multiple listings on your report for a single charge off since it is bought and reported by third-party collection agencies.
A recent late payment is especially bad for those people with previously good credit. It can instantly lower a credit score that you have spent years to establish. The scoring formula believes that a late payment may be a sign of impending financial meltdown.
Moderately severe items include a 30,60,90, or 120 day late payment. These items can either be disputed with the credit bureaus or negotiated with the creditor.
The credit scoring formula is biased more towards recent late payments. Older late payments should be given a low priority in your dispute process.
Do not lose any sleep if the credit bureaus are listing old personal information. It has no impact on your credit score.
In order to quickly clean up your credit report, you must challenge the most severe items first. It does no good to focus your time and effort on insignificant items like your employer or address.
Filed under: Management