If there is a mistake in your file, you must challenge it. Most credit bureau errors can be corrected by providing receipts to prove that you’ve made a payment, or by getting the bureau to check with the creditor. Simply fill out a form requesting the appropriate item be removed from your file, making mention to any proof you have attached (send copies, not originals) to assist their confirmation of the error. Ask the credit bureau reporting the error what their process is for dealing with it. You will find they are more than willing to assist your understanding of their escalation process for correcting errors in your file.

Mistakes in credit files are often the result of information about someone else with a similar name to yours being placed in the wrong file, and of delays, or poor information sent by creditors to the bureau. Having said all of that, creditors are also able to have judgments passed against you, (they sue you in small claims court and get a judgment) which could remain for up to 20 years by your personal credit file.

The credit bureaus and agencies will gladly correct mistakes, but they may also refuse to change your file(s) if the creditor disagrees with the change you want. If this is the case for you, then an opportunity to file a statement of your version of the situation will be taken and placed in your file. The statement may explain that you failed to pay your bills because you were sick or unemployed, or that you were withholding payment to a supplier in dispute over the quality of an item or service. If your poor credit record is well-deserved, then your options are more limited.

Information is generally kept in your file for 6 to 7 years for a bankruptcy. Bank and other lender electronic application process scoring models do not take these situations into consideration. It is very likely that if your situation is similar to the one explained above, your application will score poorly without further proof and discussion in person with a lender.

However, arrangements you have made with creditors to repay your debts can be reflected in your file. A person could request a creditor place a letter of reference and their credit file stating they are now paying bills on time. Do their research for them – do some research yourself. Obtain the necessary letters from creditors regarding errors and keep up-to-date files of your own to back up your story.

Do You Have a Bad Credit History?

There is no quick fix for a bad credit history if it is accurate and well deserved. Only consistent, positive behavior over time can reestablish your credit rating. If a lender is reviewing a poor credit history, they try to establish how long ago it happened, what the reasons were behind the problem, and whether repayment history has stabilized since then. You may be asked to provide evidence the issues have been resolved, or the errors corrected.

Divorce is a common reason for the credit of some people to become destroyed. Many banks understand this to be beyond normal conditions, and see past it. How recent the derogatory information is can still hold you back from getting what you want. If you’re divorce happened two years ago, but since then you have paid all your loans and credit cards on time, you are well on your way to establishing a very positive credit profile.

I believe it’s unlikely that a so-called credit repair firm could do anything more to improve your credit file. Be wary of any individual, or firm, that promises it will fix a bad file if you pay them a fee. It would be too good to be true if they promised the miracle needed to clean up your record and turn you into an A-1 customer. A credit clinic cannot assist a consumer to have accurate and true information removed from a credit file. It is there, and will remain there, for a very good reason.

If you do try to get some help with credit repair I urge you to look at some of the not-for-profit credit counseling agencies. You may still have to provide a small fee but it is limited in most cases, because they just need to cover their expenses as far as employees, administration, and basic overhead. If you have been bankrupt you will simply have to wait six or seven years before your credit file shows no record of it, and you can continue with a clean record going forward.

Most consumers who have claimed bankruptcy for personal reasons are very careful with their credit ratings in the future. Many times these consumers claimed bankruptcy because of marriage and divorce reasons. Many of these people with extremely bad credit ratings, that lead to bankruptcy, were only in trouble because they had joint accounts, and joint credit cards, with spouses that were completely out of control and irresponsible. It’s not fair that your credit score is intrinsically tied to somebody else who is completely off the wall, but unfortunately that is just the way it is. We must be careful who we decide to spend our life with, live with, and get married to.

Continued in the Carol’s Borrowing Series Category of Clf.