Credit dispute
Removing derogatory credit from a credit report starts with a credit dispute. When a credit dispute is made, the credit reporting agency is given 30 days to investigate the dispute. If you can prove the derogatory credit is invalid you can get the information removed. Additionally, if the credit reporting agency can not verify the account information then they are required to delete it. It is a violation of the Fair Credit Reporting Act for the credit reporting agency to continue to report information, which has been disputed, if they can not verify the account information within a reasonable time frame. Erroneous, derogatory account information on a credit report can ruin a credit score.
There are two different approaches to credit dispute: Disputes with the credit reporting agency and disputes with the creditors. If either the credit reporting agency or the creditor can not verify the information it can be deleted from the credit report. The credit reporting agency has 30 days to verify the accuracy of the item and to do so they must send a request to the creditor and the creditor must perform an investigation, with reasonable procedure and policy, to assure a proper outcome. It is not sufficient for the credit reporting agency to merely check with the creditor the creditor must perform an investigation. If the creditor can not investigate and verify the item within 30 days then the credit reporting agency will delete the item. If the credit reporting agency verifies the item the next step is to contact the creditor directly.
If the creditor can verify the item and you have no other documentation to prove the item is not valid then you can negotiate with the creditor to resolve the account. It is much better to resolve the account than to risk the creditor escalating the collection activity which often times will include additional charges including interest on the debt and ultimately you could end up being served with a court summons. Prior to a court summons you are given 30 days notice. If the debt is yours you should contact the creditor and work out a solution.
