Thursday, December 25, 2008

Fix Bad Credit

By John Cooper

If you have bad credit there is hope. You do not have to wait seven years for bad credit items to naturally fall off your credit report.

The Fair Credit Reporting Act that was passed by Congress gives you the right to dispute any item on your report. This act also makes it law that if the item is not verified by the creditor then the bureau must delete it from your credit report.

You can dispute an item through the dispute process. This is done yourself by writing a dispute letter or you can hire a service to dispute items on your behalf.

Once the bureaus get your letter they will investigate the dispute. They will contact the creator of the item and get them to verify the account, the account balance, and the dates on the account.

If the creator is unable to verify the account then it must be deleted from your report. The easiest items to remove have been learned to be a charge off, repossession and a late payment after they have aged for two years.

This is because the creditor has gotten some form of payment for your debt. For example with a charged off credit card the creditor has sold your debt to a debt collector. Therefore the creditor has no reason to save records of your account.

With judgments, bankruptcies, tax liens and recent delinquent accounts it is more difficult to remove these items from your credit. If you have one of these we suggest a service because they have more tactics they can use to remove an item.

A service can use more advanced methods to remove an item if it is verified by the lender. A service can use; creditor direct intervention, escalated dispute information requests, and debt validation.

You can also help your credit score by opening a revolving unsecured credit line. This will help your score because you can create a positive payment history and improve your ratio of debt to available credit.

In sum, you should not wait seven years for credit repair to occur naturally. You can take steps today and rebuild your score.

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